U.K. Requests for a Third Extension to BREXIT | DZHI - DZH International 
logo

U.K. Requests for a Third Extension to BREXIT

  • DAR Wong
  • 28 October 2019

CURRENCY MARKET OBSERVATIONS – 28 October 2019

 

 


Fundamental Outlook   The U.S. trade representatives says they are making effort with Chinese counterparts to almost reaching the completion of phase one deal.  The S&P 500 Index closed at 3022 and almost near to the historical high 3028 dated 26 July this year.

European Central Bank President Draghi bids farewell to Frankfurt after 8 years in office. European Central Bank has left a legacy during Draghi’s tenure as head of central bank and shape up the Euro amid strong headwind of economic challenges. On last Thursday meeting, policymakers keep the monetary policy unchanged.

U.K. Parliament has voted for a rejection to the bill presented by PM Johnson on BREXIT matter. Johnson has threatened to scrap the bill and go for an emergency General Election on 12 December. Extension has been requested for a third time for BREXIT towards next March.

On the other hand, EU leaders have agreed on the deferment of deadline but still reserve in giving the finalized date for coming extension. Pound has fallen off its 5-month high from 1.3000 benchmark.

 

Technical Forecast   USD/JPY traded in tight range around 108.50 region last week. Technically, the market is strongly resisted at 109.00 level that is confluent to EMA200 line. This week, we presume the trend will consolidate in tight range 108.00 – 109.00 region until it breaks in either directional headway. There is no clue for the headway due to much uncertainty in market volatility.

EUR/USD has begun to make correction after it fails to pierce above 1.1200 level. This week, we predict the drawdown will be countered at 1.1000 while overall range will be contained from 1.1000 – 1.1200 region. Price swings are expected to emerge in market unless we could see a lead trend in Dollar direction that moves inversely to Euro trend.

GBP/USD is moving into drawdown correction while strong resistance emerges at 1.3000 level. Literally, we foresee the corrective range will be contained from 1.2750 – 1.3000 region this week. Mixed trading is expected as traders are observing the versatile changes in U.K. fundamentals. Therefore, swing trading is advised with proper control.

Gold prices traded above USD1500 /oz benchmark last week but unable to clear above USD1520 /oz resistance. This week, we remain conservative to our forecast as U.S. stocks might return to strong bullish trend. Therefore, we are uncertain if the two markets will be inversely correlated or in tandem depending on Dollar strength. Technically, the trend may head down and trade in USD1475 – USD1500 /oz range; or move in USD1500 – USD1525 /oz region.

WTI Crude prices traded in rising demand last week after consolidated for past two weeks. Moving forward, we forecast the support will lie at USD55 /barrel and push the prices higher. This week, breaking above the USD57.50 /barrel has potential to reach USD60 /barrel again. Theoretically, a rise in U.S. stock index and Crude prices could be moving up together if Dollar begins to fall faster due to positive outcome of U.S. – China trade agreement.

Silver prices have risen from USD17.50 /oz and built a strong support at this area. This week, we target some consolidation in market movement while resistance will emerge at USD18.50 /oz level. In overall, we reckon the trend may be prone to some liquidations as trading activities might be capped beneath USD18.00 /oz.

Crude Palm Oil (FCPO) Futures on Bursa Derivatives hit 16-month high before the weekend after export rose. Bargain-hunters are returning to market waiting for price retracement. January20 Futures contract closed at RM2398 /MT on Friday after reaching intraday high RM2460 /MT level. This week, we expect some profit-taking activities will emerge and the trend trades from RM2340 – RM2440 /MT region. Volatile trend is expected throughout the week.

 

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.