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Dow Recovers on Russian Military Retreat

A guest post written by DAR Wong

Currency Market Observations - 10 August 2014

Fundamental Outlook

The US economy shows better sentiment in services industry while trade balance improves. Dow Jones recovers from huge intra-week losses after gaining 185 points on Friday. China reports better than expected trade surplus while UK narrows in trade gap. However, housing recovery continues in strong sentiment for UK property markets.

The US Institute for Supply Management's non-manufacturing index increased to 58.7 in July and exceeded the highest estimate. Factory orders rose 1.1 percent in June after revised figure showed minus 0.6 percent in previous month.

The US trade gap shrank 7 percent to USD41.5 billion in June, the smallest since January, from previous month USD44.7 billion. Trade balance was narrowed down by being less dependent on energy imports. American jobless claims were reported at 289,000 for the week ended 2...

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Gold and Oil Markets Report – 4 August 2014

A guest post written by DAR Wong and Chong HC

The Gold slammed down on last Wednesday night after FOMC meeting. FED Yellen reassured of low interests while announcing another uSD10 billion stimulus cut. Nevertheless, Ex-chief of Federal Reserve Alan Greenspan commented of overpriced value in stock markets and triggered the US 10-year bond yield to rise. Dow Jones benchmarks dropped 463 points throughout the week while Gold slid to 1280.00 bottoms.

Crude Oil

WTI Crude prices fell to almost 5-month bottom record due to demand contraction. Market prices slumped from 101.00 regions and closed at 97.00 levels throughout whole week. We believe the wind down has triggered liquidation of long traders and might see lower levels in coming week. Technically, we reckon the bears will drive down to 95.00 regions before bargain-hunting emerges. Topside resistance will start from 99.00 levels once short-covering initiates....

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Dow Jones Falls in Correction

A guest post written by DAR Wong

Currency Market Observations - 4 August 2014

Fundamental Outlook

The US housing recovery still stays sluggish though forecast for economic confidence lift higher. Gross Domestic Product (GDP) improves better and inflation reaches policymakers' expectation at 2 percent. Dow Jones benchmarks begin to correct after Greenspan's comment. Japan slows down in retail sales and industrial output while European regions slip into manufacturing declines.

The US pending home sales declined 1.1 percent in June after rising 6 percent in May, signaling struggle in housing demand. The Conference Board's index for forecasting economic confidence in coming 6 months advanced to 90.9, the highest since October 2007, at 7-year high record amid increasing job market.

The national growth in American GDP rose 4 percent annualized rate from April through June, exceeding forecast. Another separate data on annualized GDP inflation reached 2.0 percent in Q2...

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Gold and Oil Markets Report – 28 July 2014

A guest post written by DAR Wong and Chong HC

Gold trend whipsawed last week due to inverse correlation to Dow Jones benchmarks. Earnings from big capitalized stocks aid in supporting DJIA above 17,100 levels during mid-week. However, equity market slid on Friday after Ukraine tension rose amid Russian firings into the border. EIA reports a cut in crude inventories for the week ended 19 July and helps to demand support Crude prices. Analysts predict investors may search for new safe haven in Gold, Treasury bonds and Dollar amid war crisis in Gulf territories.

Crude Oil

WTI Crude prices have been resisted at 104.00 resistances last week amid market liquidation. The trend is uncertain as rising prices post threats to many countries. However, supply cut in inventories and Ukraine tension have driven support into the Crude market and make it stand above 101.00 regions. This...

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Britain Grows Faster than Pre-Crisis Peak

A guest post written by DAR Wong

Currency Market Observations - 28 July 2014

Fundamental Outlook

The US jobless claims continue to slide while housing market poises for recovery. Japan suffers trade balance due to export contraction and stagnant inflation growth. In Europe, UK economy strives to expand in optimism and has surpassed the pre-crisis peak in 2008. However, International Monetary Fund (IMF) cuts back on it global growth estimate for the year 2014.

The US consumer prices increased 0.3 percent in June after 0.4 percent gains in prior month. Excluding fresh food and energies, core data was up 0.1 percent. Existing houses climbed to 8-month highs by 2.6 percent gains to a 5.04 million annual rate in June.

American jobless claims slid 19,000 to a seasonally adjusted 284,000 for the week ended 19 July, making lowest record for past 8-1/2 weeks. On contrary, new home sales dropped...

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Greece May Need Third Bailout

A guest post written by DAR Wong

Currency Market Observations - 21 July 2014

Fundamental Outlook

The US policy revolves in debate of credit tightening before year-end as inflation increases. FED chief Yellen reassures of low benchmarks rates even after stimulus ends. Bank of Japan chief Kuroda remains neutral towards strengthening Yen. Euro area's economy continues to wobble as European Central Bank (ECB) begins to mend the slowdown. UK posts improvement from pulling out of recession.

The US retail sales rose 0.2 percent in June while core data was up 0.4 percent, both below expectation. Producer prices rose 0.4 percent in June after up 0.2 percent in prior month. Core data grew 0.2 percent matching the forecast.

Another separate report shows American housing starts fell 9.3 percent to an 893,000 annualized rate in June, the weakest data in past 9 months as construction slumped in southern states. Jobless...

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Gold and Oil Markets Report – 14 July 2014

A guest post written by DAR Wong and Chong HC

The Portugal 10-year bond yields jumped 21 basis points to 3.97 percent after Banco Espirito Santo triggered fear in debt payment. The false alarm showed the meager confidence in global investors when face with sensitivity of European debts. Gold surged after mid week as flight moved out from equity markets. Crude prices also plunged as demand was staked in yellow metal. Dollar and US Treasuries become asset haven in times of global panicky as investors search for safe country.

Crude Oil

WTI Crude prices continued to fall last week amid profit-taking. Long traders were kicked out from market as the prices fell below 104.00 levels. Market closed at 100.80 on Friday and was supported by EMA 200 average line. This week, we foresee the bears will be countered at 100.00 – 100.50 regions which trend...

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Portugal Alarms Market into Panic State

A guest post written by DAR Wong

Currency Market Observations - 14 July 2014

Fundamental Outlook

The US job market continues to gain traction in recovery. Portugal roils market confidence of investors after its subsidiary member fails to pay short-term debts. Market recovers after Banco Espirito Santo SA justified their reserve buffer after regulatory requirement. Pound slows down in ascension after reaching 5-year high record.

The US consumer credit rose in May by USD19.6 billion after followed revised USD26.1 billion gain in April. Stronger employment is still main source of booster to borrowing though data has declined. Jobless claims declined by 11,000 to 304,000 in the week ended July 5 as job market is continuing to improve gradually.

The US government posted USD70.5 billion surpluses in June compared with USD116.5 billion excess a year earlier. Data reveals the tapering effects of stimulus withdrawal that will target to...

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Gold and Oil Markets Report – 7 July 2014

A guest post written by DAR Wong and Chong HC

The US monthly payroll in June surged 288,000 and hyped up the Dow Jones markets. Last Friday, DJIA reached all time high 17,074 after the US job report. American unemployment was down to 6.1 percent. However, FED Yellen hints that interest rate policy may not be suitable to be used as benchmark to measure economic recovery. Gold dropped inversely to higher equity prices while Crude prices also receded as market took profit from 108.00 highs before the long weekend in US markets.

Crude Oil

WTI Crude prices fell last week as profit-taking occurred from 106.00 highs. Crude inventories were down on weekly basis by 3.2 million barrels but was unable to support demands in market. This week, it will depend on the Iraqi internal situation to gauge the crud direction. We foresee the trend might...

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The US Payroll Surges in Recovery

A guest post written by DAR Wong

Currency Market Observations - 7 July 2014

Fundamental Outlook

The US non-farm payroll rises better than forecast as the trade deficit narrows. FED chief Janet Yellen implies that monetary policy may not be good measure to lead economic recovery, hinting rate increase irrational to economic growth. European Central Bank (ECB) President Mario Draghi stresses on low interest rates to support recovering growth. UK persists in steadfast escalation in manufacturing sector.

The US pending home sales index climbed 6.1 percent in May, making largest jump since April 2010. The Institute for Supply Management's manufacturing index was 55.3 in June, little changed from a 5-month high of 55.4 in May. Another services index from the same institution was 56 after 56.3 in May, highest since August.

The US trade deficit shrank 5.6 percent in May, the biggest drop since November. Trade gap narrowed...

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