Market Brief: Asian Stock Markets Sustain Losses as Coronavirus Cases Continue to Rise
Asian equities markets spent another day in the bears’ territory today as coronavirus cases continued to pile up. The Nikkei 225 closed 179.2 points or 0.79% lower at 22,426.2. Chinese stocks also sustained losses with the Shanghai Composite Index down by 25.121 points or 0.83% at 2,987.929. Meanwhile, the Hang Seng Index is trading lower by roughly 220 points or 0.83% below its opening price at 26,671.0.
In South Korea, where the surge in cases over the weekend triggered a wave of risk, more patients were diagnosed with the coronavirus. Over 1,100 cases have now been recorded and the country’s death toll is at 11. A U.S. soldier stationed in South Korea was also diagnosed. Italy, Iran, and the Canary Islands are also seeing rising numbers. Meanwhile, China has more than 78,000 cases and 2,200 deaths.
Risk currencies are also weaker in today’s Asian trading. AUDUSD tapped new 11-year lows following the disappointing construction data from Australia. The second weakest among the majors is NZDUSD which is currently down -0.15% followed by GBPUSD at -0.12%.
On the hourly chart, we can see that NZDUSD has been making lower highs and steady lows around 0.6300. Connecting its tops and bottoms, a descending triangle chart pattern becomes apparent. This chart pattern is considered as a bearish signal because the lower highs suggest that the market is running out of buyers. A strong bearish close below 0.6300 would effectively break the support level. Should this happen, a bigger sell-off on NZDUSD could ensue. The next floor for the currency pair would be at 0.6255 were it bottomed on October 2019.
On the other hand, a close above today’s highs at 0.6320 could mean that NZDUSD may have buyers left to push price higher. Near-term resistance is at 0.6335 where the falling trend line seems to be.