Risk Markets Nudge Lower After President Trump Signs the Hong Kong Bill

Risk Markets Forecast, Analysis and Chart:

  • US President Trump signs bills supporting Hong Kong’s rights.
  • Risk markets drift lower, but the move is muted.

Q4 Forecasts and Top Trading Opportunities

Risk Markets Shrug After President Trump Backs Hong Kong Bills

A muted reaction from a range of risk-on and risk-off asset markets in early European turnover after US President Donald Trump passed into law two Hong Kong bills, inflaming relations with China. The new laws give the US power to administer sanctions on Hong Kong and Chinese officials proven to have committed human rights abuse, annually review Hong Kong’s special trade status as well as banning the sale of US non-lethal crowd control items to HK. In response to the US action, Chinese officials warned of ‘counter measures’ if the US kept on interfering in Chinese internal affairs, putting the ongoing trade talks between the two under further threat.

Traditional risk-on markets, including equities, slipped lower after the announcement but the sell-off was limited. European equity markets traded around 0.2% to 0.4% lower, while risk-off assets, including gold, the Swiss France and the Japanese Yen barely moved. Financial markets are quiet Thursday with the US Thanksgiving Holiday negatively impacting on turnover.

DAX 30, Gold and USD/JPY

The DAX 30 was down less than 0.20% and remains supported by the 20-day moving average….

DAX 30 Daily Price Chart (April – November 28, 2019)

Gold is little changed and remains near multi-week lows…

Gold Daily Price Chart (April – November 28, 2019)

Risk Markets Nudge Lower After President Trump Signs the Hong Kong Bill

USD/JPY recent uptrend remains intact and is touching the Fibonacci 50% retracement level…

USD/JPY Daily Price Chart (March – November 28,2019)

Risk Markets Nudge Lower After President Trump Signs the Hong Kong Bill

The IG Client Sentiment shows how traders are positioned in a wide range of asset markets, including the US dollar, the Japanese Yen, Gold and the DAX 30.

Traders may be interested in two of our trading guides – Traits of Successful Traders and Top Trading Lessons – while technical analysts are likely to be interested in our latest Elliott Wave Guide.

What is your view on the various Risk Markets – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author at nicholas.cawley@ig.comor via Twitter @nickcawley1.

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