It’s been a period of pause and reflection for equity markets, following the picture perfect price action of August, as the up elevator finally reached the next level, rolling gently over into the current phase of price congestion.
Oil traders hoping for a slow down in the bearish trend, to enjoy a relaxing weekend away from the screens, may have been tripped up by the Chinese (FXI, quote) data which slipped out on Saturday, with industrial production coming in at 6.9% against a forecast of 8.8%, missing the forecast by some distance, and whipping up the perfect storm.
There was no hiding place for the Australian dollar last week, which came under relentless and remorseless pressure, with the December futures contract closing with yet another wide spread down candle on Friday, and further confirming the bearish picture for the Aussie dollar.
Gold has continued to remain heavily under pressure once again in today’s gold trading session, with the bears in full cry, as the precious metal moved relentlessly lower to trade at $1238.70 on the December contract at time of writing.
In a post several days ago, I described the recent price action for the major US indices as perhaps the most elegant we have ever seen, arching higher through August and into early September before reaching a plateau.
The short term rally for crude oil, came to a shuddering halt yesterday, as the December WTI futures (USO, quote) contract closed at $92.88 per barrel, having shed over $3 per barrel on the day, closing as a wide spread down candle on the daily chart.
As US markets returned to work yesterday after the long Labor day weekend, and an even longer summer, trading for gold started with a bang.
Like many of the major currency pairs at present, it’s US dollar strength which has been the primary driver over the last few weeks, and for the USDCAD, which moved firmly lower once again, the decline in the price of oil has also added further momentum to the move.
Cable moved lower once again last week as a resurgent US dollar continued to drive the pair, with the September futures contract closing at 1.6770 on the daily chart.
Yesterday’s attempt by the Aussie dollar to break out from the current congestion with a move higher, was promptly snuffed out today, as poor employment data shocked the markets, sending the currency lower against the US dollar.
