Asia Spill-Over Effects From Wall Street

Recovering lost ground in Equities, Oil and the precious metal have been the main drivers of what investors are seeing from the markets decline for more than a month and a half since opening of the new year. The surge on Wall Street have likewise given Asian markets that added lift prompting even the JPN 225 a boost as it moves @16753 levels in line with the USD/JPY  @114.00 to this writing. We'll keep focus on the market behavior moving forward at the beginning of the new month's trading activity.

Meanwhile, the spill over effects of a Wall street rally & other Asian exchanges have given some life for Philippines Stock Exchange Index (PSEI) above the 6800 handle that gave the USD/PHP currency a move @47.15 contrary to a steady USD strength on a day basis. Trading the Philippine market with its US counter-part on the EPHE ETF have outpaced the PSE Index due to its higher liquidity and room to make adjustments along the DOW & SP500 as an alternative strategies not commonly available to PH main-street investors.  

Although the market is limited, the PHP currency is still well within its upper band range with a few probable hiccups on the downside before a resumption can be made since its the election campaign period is well underway. The 48.15 levels is an initial near term cap. Unlike the rest of the majors which has a wider price range to move as they are globally & openly traded in the market; unlike the USD/PHP which is quite limited & so do with the PSE Index.  

Wall St Gains - China Cuts Rates - Neutralizer - Asia Follows Stocks Higher

 

Wall St. has every reason to celebrate the Dow's recent gains from last Friday's NFP report that led it back above 18100 levels. A retest of its previous high @18288 may well be made this trading weeks ahead whenever a USD move would align in the same directional trend higher.

This has given the USD valid reason to hold lost ground and move higher at the opening of the Asian trading session. In the course of price action but not limited to the technical Gartley formation previously discussed;  the DXY higher opening levels is directly related to the Dow's last Friday's stronger closing which provided an incentive for investors to see a continuing direction for stocks. A lot of disappointed analyst that has been calling a major Dow decline faces the ever ending question when will this occur?

Watch for the re-surging volatility and fundamental drivers that may unexpectedly show the coming weeks. For now the DOW and again the USD should be monitored well as they are our main deceive market indicators. This is on top of the recent rate cut from China over the weekend Sunday as giving more flexibility for banks to provide a competitive interest rates adjustments for deposits and encourage better relations for credit and loans to pickup that would counter a slow growth for the year.

This move have been a market neutralizer for the China stocks and Hong Kong to make adjustments that saw Asia opening on stocks to move in the same upward direction the same way Wall St. finished with a positive tone last Friday.

US Stocks Cruises Higher vs. USD Slide

NOT JUST FOREX:  Wall Street is riding high with the US DJIA continued its advance @16,698.74 with a valid 52 week high week range @16,735.35; contrary to the few times that it declined. And now, everyone is paying attention & are set on the ECB report. however, being the last trading day for the month of May '2014; do expect some normal corrective moves. 

By 'Tracking & Trend-following'  the main DJIA with the SPDR DIA is @166.78 (+0.42%) rise, likewise registered a 52 week range between a 145.17 Low and a 167.29 high would provide a better perspective on how correlations do affect price action activity. And comparing it with the Pro Shares Ultra DOW30 (DDM) which is @117.75 (+0.93%) has a 52 week range level set between 87.98 low vs. a 117.96 registered high. 

For now this rally can only get better with some of MegaTrade101 prominent client investors were fortunate enough to ride well contrary to the previous mid-rise & decline of volatility seen in the market. Asian Main Street Investors with access to primary and secondary markets couldn't be more glad to have these information available to them and likewise be validated from Wall Street market movements. Click here

Insight: Capital Flight From USD

Following a record high on Wall Street, the Chinese Reminbi or better known as the 'Chinese Yuan' have plunged to its biggest drop in over three years which was mainly due to its contracting economy and talks of credit-tightening that have pressured china's stock market at the same time.

The market conditions would be ripe to also trigger real estate prices to move initially lower for now while the market tries to steady investors behavior moving forward this week's market activities. Meanwhile, the positive mood among US and European stock investors has somehow helped spill-over interest in Asia with Japan's Nikkei moving by a 1.4% and going beyond the 15,000 key price level, which in turn has provided the US Dollar / Yen to move better to the 102.56 USDJPY to this writing.

Capital Flight From USD