WTI Crude Rises for Biggest Range in Q1 Season
- 1 April 2019
Fundamental Outlook The U.S. Treasury Secretary Steven Mnuchin says that U.S. – China trade talk has been constructive but no details are released yet. The talk was held in Beijing in replacement for the Trump-Xi meet supposedly to be held in Mar-a-Largo.
The U.S. Bond yields has become inverted from 3-month debt to 10-year debt instruments, showing signs of a possible recession. Dow Jones benchmark slows down in growth value as investors move to become observant.
Housing prices in London fall at the fastest rate in a decade as BREXIT bites. The National house price index slid 3.8 percent in Q1 season of 2019 compared to same period a year ago. Current account dropped GBP23.7 billion in the final quarter of 2018 and slid on 3rd consecutive quarters.
The EU has agreed to extend the BREXIT to 22 May if the U.K. MPs approve to the agreement at end March. Otherwise, a continual impasse in U.K. Parliament will render the BREXIT on 12 April. So far, the U.K. Parliament has reached a political deadlock over BREXIT issue after the voting failed for a third time to support PM May on Friday.
WTI Crude prices made biggest rise on quarterly season in first 3 months of January 2019. Supply cut has been reinforced by OPEC and Russia and the U.S. sanction on Iran and Venezuela.
Technical Forecast USD/JPY moved in tight range last week in mild uptrend. This week, we reckon the trend will be strongly resisted at 111.50 – 112.00 region in case of ascension. Technically speaking, the market is prone to fall if it could not clear above 112.00 in coming week. First support is expected at 110.00 level but falling beyond this benchmark will initiate a new selling trend.
EUR/USD traded in weak demand last week but the technical chart shows strong bargain-hunting forces at 1.1200 region. This week, we foresee a possibility to reverse the trend from this support area and begin a rebound. Range is expected to move from 112.00 – 114.00 region in mixed sentiment.
GBP/USD is still trapped in mixed sentiment due to BREXIT matter. This week, we forecast the range will be contained from 1.3000 – 1.3300 until it breaks beyond this constriction. There is no clue to the directional trend as traders still keep a close observation to the outcome of extension date.
Gold prices revealed a strong engulf pattern on week-chart at close of Friday. This week, we expect the trend to be bearish but supported at USD1275 – USD1280 /oz region. In overall, the resistance emerges at USD1310 /pz and trend will thread from USD1275 – USD1305 /oz region. Traders can attempt to enter market from the extreme ends for short-term gains.
WTI Crude prices traded in small range last week while hovered around USD60 /barrel region. This week, we expect the market to ascend on higher probability as Dollar may fall. Upon rising, we maintain our view from USD58 – USD62 /barrel while prone on the ascension. Breaking above USD62 /barrel will trigger a new buying interest and aim at USD68 /barrel level.
Silver prices traded lower last week and near to USD15.00 /oz level. This week, we have identified strong support at USD14.80 – USD15.00 /oz region in case of drawdown. Market will probably bounce off this bottom area and move into consolidation. Sideways trend is expected at this phase and cap beneath USD15.50 /oz resistance.
Crude Palm Oil (FCPO) Futures on Bursa Derivatives slid last week as European Commission concluded Palm oil cultivation results in excessive deforestation and use of Palm as biofuel should phase out by 2030. Futures contract in June19 closed at RM2103 /MT. This week, we foresee the bears will drive lower and test RM2040 /MT area while resistance will act at RM2150 /MT. Breaking beneath RM2040 /MT support will test the next lower region at RM1970 /MT before buying interest emerges.
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 email@example.com