THE US Government ordered the closure of China’s consulate in Houston in the name of defending intellectual property and private information.
The action has intensified tensions between US and China.
China ordered US consulate in Chengdu to be closed in retaliation of the US’ action to close China’s consulate in Houston.
Stock markets in both countries traded lower as the bilateral tension escalated.
On Thursday, the US State of Secretary Mike Pompeo delivered a speech in the Richard Nixon Presidential Library and called for allied countries to induce changes in China.
He further instigated the peace-loving Chinese people to rally against the Chinese Communist Party.
This act is interpreted as an open declaration to deepen the sour relationship with China.
US jobless claims was at 1.41 million cases on the week ended July 18.
The US economy continued to weaken amidst the spread of the Coronavirus Disease 2019 (Covid-19) pandemic.
The European Union (EU) leaders are working towards a massive stimulus of 750 billion euros to fight the pandemic crisis.
The budget is the largest in history and will be jointly paid by the EU member countries until 2058.
US dollar/Japanese yen traded around 107 and fell on Friday. We forecast the trend would sink deeper with 107 as the resistance.
Downside movement might reach 104 to 104.50 as the yen strengthens.
Abandon your short-view in case of reversal above 107.
Euro/US dollar broke last week against our expectations as the dollar weakened.
The trend rose to 1.1650 before the weekend and short-squeezed market sellers.
We foresee the bulls will climb further and reach 1.18 before profit-taking activity emerges.
Downside support is above 1.15 in case of a drawdown.
British pound/US dollar rose above 1.26 resistance last week and went to 1.28 on Friday.
The trend might continue to surge with support rising at 1.265.
We expect the bulls to reach 1.305 again and this could lure many sellers into the market.
WTI Crude prices have not risen much despite weakened dollar.
The trend climbed to above US$42 per barrel.
We retained our view that the movement will be contained from US$39 to US$42 per barrel until we see a possible decline.
Observe the dollar’s trend in August that might pull up for some corrections.
Crude Palm Oil (FCPO) Futures on Bursa Derivatives rose to a five-month high as bullish sentiments returned to the market. October Futures contract settled at RM2,777 per MT on Friday.
The trend could climb higher like we predicted last week.
The target is at RM2,900 per MT before most traders begin to take profit before the month-end.
Immediate support lies at RM2,650 per MT for ensuring the persistent uptrend.
Gold prices closed above US$1,900 per ounce on Friday that was last seen in September 2011.
This week, we aim for higher grounds as more funds will pursue the yellow metal.
We reckon the market trend might reach US$1,950 per ounce before the bulls slow down for profit-taking.
Downside support will emerge at US$1,870 per ounce in case a fallback.
Silver prices surged in strong buying sentiments last week.
We have identified the support at US$22 per ounce.
Topside target might arrive at US$26 per ounce.
Traders are reminded to be cautious.
Dar Wong has 30 years of trading and hedging experiences in global financial markets. The opinion is solely his own. He can be reached at [email protected]