I hope everyone had a great weekend!
Overnight the most important macro economic data came out of China and Europe in the form of HSBC's final Manufacturing PMI with Chine sliding to 1 year lows on a contractionary print of 48.9 vs the expected 49.4.
The final Eurozone Composite Manufacturing PMI jumped a little to 52 from 51.9 with Germany making up most of the gains while France slipped further in to contraction at 48 (anything under 50 is contraction in manufacturing).
As for our bounce, we may see some early day weakness....
ES 1 min with a 1 min negative divergence.
I suspect this is because Energy is starting to see a decline from overnight strength in oil...
Brent Crude futures with a much sharper negative divergence.
but ultimately the positive divergence from last week that was behind our bounce forecast for earlier this week like this ES 10 min chart should hold up.
Brent Crude/USO however, looks ready for that decline I'm looking for on this 5 min futures 3C chart
As well as this 15 min which shows a reversal process in place.
The $USD 1 min chart is showing a little early 3C 1 min weakness as well, but again, I expect the USD to bounce so this should be minor.
The 10 min $USD's positive divergence for a counter trend bounce as forecasted last week...
$USD 10m
And the 60 min view of the USD with our initial bounce to the upside followed by a much larger downside move which has already seen 1 counter trend bounce (yellow), this second should be no different as the $USD is in the area of intraday support, but it should ultimately break lower and make a lower low in $USD changing the landscape for numerous assets, carry trade, etc.
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