Two tweets from President Donald Trump rocked markets on Monday, and weren’t just bluster: The U.S. plans to hike tariffs on Chinese goods this week, accusing China of backpedaling on commitments made during the talks as the top U.S. trade negotiator confirmed. It has left Beijing struggling to know how to respond, traders, raising rate-cut bets and has analysts on Wall Street questioning whether the tariffs are a tactic. The pattern of prior tweets and market movements suggest buying the dip.
Economic activity in the euro area at least showed some signs of stabilizing. The race to replace Mario Draghi atop the European Central Bank is heating up too and raising suggestions that a change in the bank’s mandate could also emerge.
Asian stocks were mixed as traders assessed the impact of the re-escalation in the trade war, with Korean and Japanese shares returning after holidays and sinking, while Chinese stocks recovered some of the losses suffered on Monday.
AUD Retail Sales (MoM) (Mar)
Reported: 0.3% Predicted: 0.2% Previous: 0.9%
AUD RBA Interest Rate Decision (May)
Reported: 1.50% Predicted: 1.50% Previous: 1.50%
AUD RBA Rate Statement
USD JOLTs Job Openings (Mar)
Predicted: 7.350M Previous: 7.087M
CAD Ivey PMI (Apr)
Predicted: 51.5 Previous: 54.3
This pair has shown a Engulfing Bullish signal on it’s 1D chart indicating a likely reversal to an uptrend.
The precious metal’s 1D chart has shown a Three Outside Up pattern signaling a strong reversal to an uptrend.