The US budget talks turned on Friday as Republican leaders cancelled one vote for higher tax on top earners. Stocks declined amid rising dollar.
Gold prices recovered in late session while Crude prices remained in low demands. As the European currencies might be receding after Christmas season this week, the decision of USD/JPY trend by the Japan’s new government will be essential to gauge the Gold and Crude direction based on dollar strength.
WTI Crude prices moved mainly in our predicted range after it has been topped out at 90.54 last week.
Fundamentally, a continuation of march-up in USD/JPY in coming week might lift the crude price higher to test 91.50 areas.
However, we also foresee slow trading liquidity over this festive season as the trend may consolidate from 87.50 to 90.00 regions.
The outcome of market favour from US budget negotiation will directly influence the crude direction due to the dollar strength.
Gold prices fell from 1,703 top to 1,635 bottoms last week despite dollar receded.
Fundamentally, traders are using the USD/JPY trend to gauge inversely to Gold prices now as the yen market has attracted large volume of players.
This week, expect the market to consolidate from 1,645 to 1,660 amid low liquidity.
The market will resume trading activity in early January while waiting for the outcome for US budget decision.
Crude Palm Oil Futures (FCPO) trading on Bursa Derivatives rebound on Friday and erased the whole week losses.
The sentiment turned bullish on the market mainly due to increased demand from china. The newly active month in March contract closed at 2,409 with approximately 33,000 contracts on Friday.
This week, we foresee the volatility of the market will be low amid week-long holiday season and expect the market range to trade from 2,350 and 2,450 levels.
Disclaimer: This report is written for general information only. No liability by the writers, publisher or any third party involved in the distribution of this work. Dar Wong and Chong HC are the market strategists in APSRI on CPO markets. Wong has 22 years of trading and hedging experiences while HC traded for four years and now coaches institutional customers. They can be reached at www.traderpromaster.com.