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The WTO Arbitration will be Finalized on Monday

  • DAR Wong
  • 30 September 2019

CURRENCY MARKET OBSERVATIONS – 30 September 2019

 

 

Fundamental Outlook   The process of impeachment on President Trump has started on his intention to influence the 2020 election. Trump administration has called for a block on all Chinese investment and could be a market diversion to his supporters. The WTO arbitration on U.S. and European Governments will be finalised on Monday 30 September on a 15-year old dispute.

The U.S. Treasury Secretary Mnuchin says he has called for the Chinese delegation to skip the visit to Montana farmers on 20 September, so as to avoid further confusion since the Chinese counterpart has agreed to make purchase for farm products. President Trump is surprised and unaware of this arrangement beforehand.

The U.S. Lower House has called for the inquiry of impeachment on President Trump for abusing power to influence the 2020 election. An investigation has been opened based on the transcript of tele-conversation on 25 July between Trump and President Zelensky of Ukraine. In the conversation, Trump instigated Zelensky to investigate his political peer Joe Biden, former U.S. Vice President, and his son.

On Friday, Trump administration made public release to block all investment of U.S. companies into Chinese entities, resulting price fall in Alibaba and Baidu shares.

The U.K. Supreme Court has ruled the order for suspension in Parliament by PM Johnson to be unlawful. Lawmakers are calling for Johnson to resign and most Parliament members are expecting the BREXIT to have no deal in end October.

The WTO arbitrators are reviewing a 15-year old case brought up by United States against the European Governments on providing financial aids to Airbus Corporation. If the dispute case is won by U.S. litigators, America will be allowed to impose billions of tariffs that could hit the EU Governments. However, the European Union has also its similar case underway on accusing U.S. Government for aiding Boeing.

 

Technical Forecast   USD/JPY traded in our target range last week. This week, we remain almost unchanged in our view that the trend will be contained in tight movement from 107.00 – 109.00 region. Due to the uncertainty of Dollar direction, there is no clue on USD/JPY trend until we see a breakout of the aforementioned range in either headway.

EUR/USD could not recover above 1.1000 due to strong Dollar trend. The market has submerged to our support below 1.0950 and might dive lower soon. This week, we forecast the bears will head down to test 1.0850 support while topside resistance emerges at 1.1000 region.

GBP/USD fell off 1.2500 level last week after negative news on unlawful suspension of U.K. Parliament and possible no deal BREXIT. Pound is facing strong headwind of bearish factors and probably will thread in weak uncertain trend ahead. This week, we foresee the range will be contained from 1.2200 – 1.2400 in mixed position as traders adopt a wait-and-see attitude on the Pound.

Gold prices closed below USD1500 /oz on Friday after the market topped off USD1535 /oz high last week. Technically, we have identified an initial consolidation range from USD1485 – USD1515 /oz among whipsaw trend. However, there is a likelihood of piercing below the support and test the next lower ground support at USD1450 /oz in October.

WTI Crude prices traded in slightly lower prices while the movements have been narrowing at USD55.00 /barrel support. This week, we reckon a possible reversal will occur and regain the market foothold at USD60.00 /barrel. However, bear in mind the support at USD55.00 /barrel is crucial and breaking beneath this level will expose the bear to USD52.00 /barrel region.

Silver prices have exposed the bear factor in market and likely to continue its fall in coming week. We forecast the trend will meet the next support at USD16.80 /oz if the trend slides further. Tight range is expected from USD16.80 – USD17.80 /oz for the time being while most attention will be focused in Gold trend.

Crude Palm Oil (FCPO) Futures on Bursa Derivatives traded lower on week chart but has been supported at RM2140 /MT area. Market drops to 6-week low due to weaker demand and fir output. December19 Futures contract closed at RM2150 /MT on Friday. This week, we reckon a mild recovery will occur in tight range from RM2140 – RM2200 /MT amid some short-covering. However, beware of breaking beneath the RM2140 /MT support that will lead to RM2100 /MT as our next possible level.

 

 

DAR Wong has 30 years of trading and hedging experiences in global financial markets. The opinion is solely at his own.  He can be reached at dar@pwforex.com


About the Author
DAR Wong (Singapore)
An international speaker with 27 years of trading experience in the global financial markets, DAR is a Market Master and author of “Living Daylight in Stock Market: Monetizing Your Profits in 8 Days”.

DAR Wong is an active market trader, registered fund manager, educator and author.He began his career in 1989 as an institutional Futures trader with Bank of America. DAR Wong specializes in trading global derivatives and financial markets. He has 26 years of experience accumulated through tenure with Bankers Trust, Barclays Bank, Citigroup (Smith Barney Shearson Inc) and as an independent trader.

DAR is the author of “8 Ways to Invest in China’s Emerging Market” and contributes frequently to regional media, including financial TV/Radio programmes, newspapers and magazines for professional traders and active investors.

He is a popular and sought after international speaker who has presented to financial professionals and investors throughout the region including Singapore, Malaysia, Indonesia, Thailand, Hong Kong, China, Cambodia, Myanmar, Philippines, Sri Lanka, India, South Korea, Laos, Vietnam, United Kingdom and Middle East (UAE).

DAR is registered with NASD (now known as FINRA) series 3 and 5 as approved by National Futures Association (NFA) of USA and holds a current portfolio as Fund Strategist and Advisor with Dektos Investment registered with Monetary Authority of Singapore.

DAR is profiled as “One of the most successful traders – Market Masters” in Brent Penfold’s bestselling book “The Universal Principles of Successful Trading “. In January 2015, DAR was honored with Outstanding Award for International Financial Market Analysis granted by ASEAN Commerce (Thailand).

DAR is the author of "8 Waysto Invest in China's Emerging Market" and contributes frequently to regional media, including financial TV/Radio programmes, newspapers and magazines for professional tradersand active investors.1

He is a popular and sought after international speaker who has presented to financialprofessionals and inverstors throughout the region including Singapore, Malaysia, Indonesia, Thailand, Hong Kong, China,Cambodia, Myanmar, Philippines, Sri Lanka, India, South Korea, Laos, Vietnam, United Kingdom and Middle East(UAE).2


Year
2003 - Set up ASPRI to provide hedging advisory for corporate clients and training for financial professionals
2009 - Released first book “8 Ways to Invest in China’s Emerging Market”
2010 - Profiled as “one of the most successful traders – Market Masters” in Brent Penfold’s bestselling book “The Universal Principles of Successful Trading” along with Larry Williams, Andrea Unger, Michael Cook, and Daryl Guppy etc
2011 - Received “Spirit of Enterprise”awarded by Singapore Management University in Singapore
2012 - Honored with Individual Diamond Career (Thailand) awardedby Royal Privy Council of Kingdom of Thailand
2013 - Appointed Vice Chairman of ASEAN-China Commerce Association and led a delegationtothe annual China-Asean Expo in Guangxi Province, China
2014 - Fund Manager cum Director in Dektos Investment Corporation registered with Monetary Authority of Singapore
2015 - Released new book “Living Daylight in Stock Market - Monetizing Your Profits in 8 Days” in January
2015 - Honored with Outstanding Award in International Financial Market Analysis awarded by ASEAN Commerce (Thailand)
2016 - Honored with Medal of Integrity by Royal Councilin Palace of Palembng, Indonesia

References

1.TV programs on ChannelNewsAsia (Singapore);Radio on 95.8 Capital (Singapore); Newspapers such as The Borneo Post (Malaysia), 资汇报 (Malaysia); Regional financial magazines such as The Analyst (India), 东盟商界(ASEAN, China), 资本杂志 (Malaysia).

2.Spoke at events for CME Group, Euronext LIFFE, Tokyo Commodity Exchange, Singapore Exchange, Korea Exchange, Bursa Malaysia, Thailand Futures Exchange, Jakarta Futures Exchange, Indonesia Commodity and Derivatives Exchange, Tokyo Commodity Exchange, Interactive Brokers, Xinhu Futures, Hangzhou Money Fair, China (Shenzhen) International Finance Expo, China (Guangzhou) International Finance Expo, Euromoney, CIMB, Maybank, RHB, UOB Bank, Asia Trader & Investor Convention, Global Rubber Conference, International Rubber Conference, Malaysia Rubber Board, International Rubber Research and Development Board,Malaysia Ministry of Agriculture, Rubber Industry Smallholders Development Authority, Vietnam Rubber Association, Cambodian Rubber Association, Bureau of Agriculture Research Philippines, Myanmar Rubber Planters & Producers Association etc.