While resurfaced Brexit uncertainty keeps Sterling generally weak today, Dollar is trying to take over and fresh selling is seen in early European session. In particular, USD/JPY took out 111.82 minor support and resumed recent pull back from 114.54. Deeper fall should now be seen to 110.75 fibonacci level. AUD/USD also breaks last week’s high and reaches 0.7143 so far. Swiss Franc and Yen are the strongest ones.
European markets is indeed mixed only. At the time of writing, DAX is up 0.07%, CAC down -0.32% and FTSE down -0.06%. German 10 year bund yield drops below 0.5 handle to 0.496. Italian 10 year yield is relatively stead at 3.573. Asian markets were troubled by risk aversion though. Nikkei closed down -1.87%, Singapore Strait Times down -0.76%, Hong Kong HSI down -1.38% and China Shanghai SSE down -1.49%
Gold’s rally resumed by taking out last week’s high and reaches 1233.30 so far. For now, we’re still seeing rebound from 1160.36 low as a correction. Thus, strong resistance should be seen 1235.24/1236.99 cluster resistance zone (38.2% retracement of 1365.24 to 1160.36 at 1238.62, 100% projection of 1160.36 to 1214.30 from 1183.05 at 1236.99). to limit upside. However, firm break of this zone will invalidate our view and target 61.8% retracement at 1286.97 and above.
