UN Security Council imposes new sanction on North Korea
Fundamental Outlook
The US home sales market soar and signals inflation amid rate hike last week. Korea Peninsula tension may rise very soon in New Year seasons as UN Security Council passes new sanction on North Korea. Eurozone’s inflation grows in steady pace.
The US housing permits rose by 1.3 million in November while the previous month has been revised higher to 1.32 million. Housing starts also went high at 1.30 million in the same month. Another report on current deficits improved by narrowing to US$ 101 billion in November that is lowest over three years.
The US existing homes sales continued to soar higher in more than eight-year high after November grew 5.81 million cases. Orders for durable goods rose 1.3 per cent in November while core orders, excluding transport equipment, dipped 0.1 per cent for the first time in seven months.
Consumer spending grew 0.6 per cent in higher than 0.3 per cent in October. Another report on new home sales rose to 10-year high at 733,000 in November.
UN Security Council passed new sanction on North Korea by capping the oil support at 500,000 barrels per year and repatriation of overseas workers within 24 months.
German Ifo business climate rose to 117.2 in December and stays firm on growth. Eurozone consumer prices rose 1.5 per cent in December on year basis. Excluding food and energy, core prices grew 0.9 per cent from last year.
UK current deficits shrank 22.8 billion pounds in November and narrowed down from previous month. Another report on GDP in 3Q seasons grew 0.4 per cent.
Yemen continued to struggle in civil war between the political fight among Saudi and Iran by supporting their favorable government. Analysts reckoned the feud has entered into new unpredictable region. Technical Forecast
US dollar/Japanese yen traded in mild recovery last week amid range bound region. This week, we predict the trend will move from 111.50 – 113.50 without much changes. Market activity will slowdown in coming week due to year- end seasons.
Euro/US dollar recovered in small rise last week but capped under 1.1900 level. This week, we foresee the trend will trade sideways and prone to decline slightly. Range might move from 1.1750 – 1.1900 in tight activity. Breaking above 1.1900 needs risk control.
Pound / US dol la r has narrowed in price formation while the trend settled at 1.3360 region. Technically, we have identified the impending market parameters from 1.3300 – 1.3400 and moving beyond any of these extremes will go into a new directional trend. Technically, we reckon the trend may drive lower at 1.3100 in January.
Disclaimer: This article is written for general information only. No liability by the writer, publisher or any third party involved in the distribution of this work. Dar Wong is a registered fund manager in Singapore with 28 years of global trading experiences. You may reach him at dar@ pwforex.com.