Chart of the Day - AUS200
Over the past 24 hours, risk appetite faded in Australian equities as we’ve seen a heavy sell-off in AUS200 ahead of today’s employment figures due for a release (AEST 1130). The employment and wage data are key as the RBA formulates the plan for any further monetary policy decision making in early 2020.
The long term monthly resistance at 6770 is the key as the bidders are winning the battle right now with scope for a potential further pullback on the cards. The fundamental picture in the US-China trade war and Brexit remain a prominent threat and still dominates the headlines as we await the US decision on European auto tariffs. Right now, we feel the market is preparing for any potential negative news and in that scenario, we might see AUS200 re-test the short-term support at 6630 to 6650 range. The 21- day EMA has broken to the downside as 14- day RSI is stuck at the midpoint 50% range.
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