US President Trump’s evening prime-time speech on Wednesday, 1 April at 9.00 p.m. Washington time does not offer any new information to global financial markets. A quick recap: Trump highlighted earlier on Tuesday, March 31, that the US-Iran war will “end soon” within the next two to three weeks.
Interestingly, Trump has indirectly issued a more “hawkish rhetoric” towards the Iranian leadership in his prime-time national address, stating that the US will hit Iran “extremely hard” in the next two to three weeks, and added that the US will also strike Iran’s electric plants if there is no deal.
Overall, there is no clear indication of a forthcoming “de-escalation” from Trump, which in turn brings the stagflation risk narrative back to the forefront again.
How do the markets react? Risk-off mode at this time of writing.
- WTI crude oil +5.8% at around $104 per barrel
- Brent crude oil +6.4% at around $106 per barrel
- US Dollar Index +0.4%
- AUD/USD -0.6%
- Gold (XAU/USD) -1.7%
- S&P 500 & Nasdaq 100 E-mini futures -1.1% & -1.3%
- Japan’s Nikkei 225 -2.2%
- Hong Kong’s Hang Seng Index -1.1%
- China’s CSI 300 -0.7%
- South Korea’s KOSPI 200 -4.7%
- Singapore’s Straits Times Index -0.7%
We have highlighted in our earlier detailed report that the prior three-day rebound seen on the three major benchmark US stock indices, S&P 500, Nasdaq 100, and Dow Jones Industrial Average are likely a mean reversion rebound sequence (dead cat bounces) within their respective medium-term downtrend phases.
Read more: Chart alert: US stock indices rally smells like a dead cat bounce – outlook on S&P 500, Nasdaq 100, and Dow Jones (DJIA)
Let’s focus now on the short-term trajectory (1 to 3 days) on the S&P 500, Nasdaq 100, AUD/USD, Gold (XAU/USD), and WTI crude oil from a technical analysis perspective.
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