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U.S. Denies on Roll Back on Chinese Tariffs

  • DAR Wong
  • 11 November 2019

CURRENCY MARKET OBSERVATIONS – 11 November 2019

 

U.S. Denies on Roll Back on Chinese Tariffs

Fundamental Outlook   The U.S. productivity fell 0.3 percent in Q3 season on annualized rate, making biggest fall since 2015. Dow Jones still edges on new historical high and market closed at 27,681 on Friday.

President Trump and Chinese leader Xi have delayed the signing of trade agreement to December as the two parties are still wrangle over terms and venue. China is pressing U.S. to remove the tariffs on USD250 billion worth of imports in phase one agreement while agreeing to cancel the existing tariffs on U.S. goods in phases.

Last week, market traders responded in optimism amid higher stock prices. However, White House denied to roll back on tariffs on Friday and President Trump said he has not agreed to anything.

China’s import and export fell less than expected in October. Trade balance in USD term rose USD42.8 billion in October and above median forecast. Chinese officials comment the country is researching on 6G technology while they have just started to launch 5G network currently.

Bank of England holds monetary policy unchanged in the central bank meeting before the general election on 12 December. Analysts are watching the BREXIT progress as U.K. lawmakers believe the nationwide election will lead to a better decision making situation for the post BREXIT deal.

OPEC has lowered the forecast of oil demand on global basis. The world will get less dependent on oil over future years as electric cars are gaining traction in new economy.                                                                 

Toyota and BYD car makers have agreed to venture into developing full battery driven automobiles.

 

Technical Forecast   USD/JPY is hovering 109.00 level again as Dollar regains traction. This week, we forecast the market trend will slow down in ascension and meet strong resistance at 109.50 area. Overall range will be trapped from 108.00 – 109.50 with prone to drawdown in prices.

EUR/USD traded in lower prices last week due to profit-taking activity. Market trend is prone to go lower this week as resistance will act strong at 1.1100 level. Overall range is expected to be contained from 1.0950 to 1.1100 region as traders become more cautious. Bargain-hunters will ambush for picking bottom below 1.0950 level.

GBP/USD closed at 1.2770 after topped off 1.3000 benchmark. This week, we reckon the trend will fall deeper due to uneasy news of BREXIT as the time line approaches December. Technically, we foresee the bears will test 1.2600 level before bargain-hunting emerges. Traders should stay alert in case of prices swing against your interest.

Gold prices fell off USD1500 /oz benchmark last week after the U.S. – China trade deal optimism has excited the market traders. This week, we predict the first support at USD1440 /oz will be tested. However, the failure to safeguard against the bears will likely render the selling activity land at USD1410 /oz in near future. Topside resistance will emerge at USD1480 /oz level.

WTI Crude prices threaded in tight range below USD58 /barrel last week despite Gold prices plummeted. This week, we foresee the initial range will stay unchanged from USD55 – USD58 /barrel but watch closely for a potential breakout above the aforementioned range. Piercing above the USD58 /barrel will likely climb to USD60 /barrel while Gold prices dip further.

Silver prices plunged more than a dollar and settled at USD16.80 /oz on Friday. This week, we project the trend will be still bearish with resistance acting on USD17.30 /oz in case of recovery. Downside target is aimed at USD16.00 /oz as the prices drop further. The continual profit-taking will trigger some sell-off actions in market for a while.

Crude Palm Oil (FCPO) Futures on Bursa Derivatives rise as export has increased due to shrinking stockpile. January20 Futures contract closed at RM2579 /MT on Friday at best record since January 2018. This week, we expect the trend to be trapped sideways from RM2500 – RM2600 /MT in mixed trading. Breaking above RM2600 /MT will encounter strong resistances and make the rising trend short-termed.

 

 

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.