The risk-off swing is gathering pace ahead of North American trading
S&P 500 futures are down by over 1% and we are also seeing European equities cut gains on the day, as the risk mood is turning uglier amid escalating US-China tensions.
In the currencies space, the yen is firming with USD/JPY testing waters under the 107.00 handle but do be reminded that there are large expiries rolling off today the figure level so that could be a consideration to draw price action for the time being.
Meanwhile, the aussie and kiwi have been hit by the news with AUD/USD falling from 0.6460 to 0.6430 while NZD/USD is down from 0.5985 to a low of 0.5960.
Looking back to US stocks, this will once again be another test of dip buyers' resolve on the day and as we look towards the weekend. Headline risks are going to be key so be mindful in case we do hear of anything from Trump or China in the hours ahead.
As for technical levels, the 2,800 level in the S&P 500 remains key in terms of a daily support.
