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Boris Johnson Becomes the New British Prime Minister

  • DAR Wong
  • 29 July 2019

CURRENCY MARKET OBSERVATIONS – 29 June 2019

 

Fundamental Outlook   American jobless claims fell to 206,000 in the week ended 20 July and data signals strong employment market. The quarterlyGDP for Q2 seasons grew 2.1 percent and above forecast, versus 3.1 percent gains in Q1 seasons.

President Trump agrees to give timely licensing approval to U.S. chipmakers for selling equipment to Chinese tech giant Huawei. Chinese importers have made inquiry on prices from American agriculture exporters of potential transaction. This week, trade negotiators from U.S. and China will meet to further discuss on trade deal after the last meeting between Trump and Xi in end June.

China’s industrial profit fell 3.1 percent in June from a year ago to RMB601.9 billion, following a 1.1 percent annualized gain in May. In the business sector, Alibaba Group is planning for a second listing in Hong Kong and other Chinese companies may follow suit.

IMF forecasts the global economy will grow 3.2 percent in 2019 and risk continues to weigh on downside due to ongoing U.S. – China trade war.

European Central Bank policymakers keep interest rates unchanged. President Draghi signal more easing may follow if recession surfaces. In Eurozone, another trade war is heated up among U.S., Germany and France on automobile, wine and digital tariffs.

Boris Johnson wins election and becomes the U.K. Prime Minister. Pond has fallen as market analyst reckon Johnson is a believer for no-deal BREXIT and will lead U.K. into harsh separation in October.

Last Thursday, North Korea fired 2 short-range missiles and conducted first test launch after conversation with President Trump in June. Leader Kim says this is warning to warmongers from the South. U.S. Government has not given any comment. 

 

Technical Forecast   USD/JPY recovered from 107.30 support after Dollar strengthened. This week, we forecast the range will be limited below 109.30 level while the overall range will be contained above 107.30 area. Traders are still watching the Dollar as major catalyst in moving the USD/JPY trend.

EUR/USD has settled at support area on Friday as Dollar rose. Market is still sitting on 1.1100 support and hopefully can bounce for recovery this week. Technically, there is a danger of plunging lower at 1.0850 region before bargain-hunting steps into market. On the other hand, upside potential is limited at 1.1200 level in case of recovery.

GBP/USD fell after Johnson was announced as the new Prime Minister. Currently, market is very near to the 1.2350 support and may drive lower to test 1.2100 ground. In case of recovery, we foresee the resistance will emerge at 1.2500 level. Pound is rather uncertain and needs caution for trading. 

Gold prices have been trading in small range amid uncertainty last week. For the time being, market has lost the bullish steam but still well supported above USD1410 /oz level. This week, we reckon the range will be contained from USD1410 – USD1430 /oz until there is a breakout beyond. However, this might be observed by using the Crude trend as a counterbalance to the yellow metal.

WTI Crude prices traded in small range last week with no fundamental news in oil market. Technically, the trend is still contained from USD55.00 – USD57.50 /barrel until there is a new driven force pushing beyond the range. We foresee a potential in moving up as Dollar may begin to weaken in near future. Piercing above USD57.50 /barrel will rise to USD60.00 /barrel as our next target.

Silver prices have met strong selling forces above USD16.60 /oz and will begin to correct soon. This week, we foresee the trend to lower at USD16.00 /oz support. Sideways trend is expected to emerge in market from USD16.00 – USD16.60 /oz as traders adjust their mixed positions. Comparatively, we predict the Gold prices will have more market participations in case the precious metals fall in coming week.

Crude Palm Oil (FCPO) Futures on Bursa Derivatives traded higher last week following soybean oil rise. October19 Futures closed at RM2065 /MT on Friday and closed at 8-week high record. If the trend could stand above RM2040 /MT level, we foresee the bulls will ascend higher to test RM2120 /MT before profit-taking activity emerges. Ideally, the USD/MYR rate has to trade above 4.10 level in order to lead FCPO on continual recovery.

 

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.