Last Week’s Market Overview
Last week, the market was still eyeing on the progress of Brexit talk as the deadline of transition period was approaching.
Despite the fact that some financial institutions raised the expected chance for a no-deal Brexit, most of people believed there would be at least a partial deal, so the GBP had a sharp appreciation against USD since September. Therefore, it rebounded quickly to above 1.3480 after pulling back to near 1.3215 before Thursday.
On Thursday which is also the Christmas Eve, the UK finally offered EU fishing concession, which acted as a “final push” for both sides to agree on a “Zero tariff and quota” trade deal. As a result, the GBP skyrocketed to about 1.3620, but the surge lasted for a while only, it quickly made a retracement and closed at 1.3531.
The market volatility fell significantly heading into Christmas and New Year holidays, the oil became the worst performer among the most popular trading instruments listed in the following chart even though it dropped 1.15% only.
Last week, a highly infectious new strain of Covid-19 has emerged in England and it is expected to spread 70% faster than that of normal type. More than 40 countries thus Imposed new travel restrictions to UK, which would hit the oil demand hardly, the oil price in turn tumbled at the beginning of the week.
As a Brexit trade deal was reached before Christmas holidays, oil edged higher, but was restricted at 48.50 interval.
Market Change Last Week
Market Focus This Week
PMI of China
The China Federation of Logistics and Purchasing (CFLP) is going to release the non-manufacturing and manufacturing PMI of December on next Thursday.
The last month’s PMI figures reached to the highest of recent years, showing the continuation of strong expansions in both sectors.
As the worsening situation of pandemic in most of the countries, especially the UK, virus restrictions and lockdowns might limit export orders and delivery of export orders in December. Moreover, China restricted the usage of electricity in some provinces, such as Zhejiang, Hunan and Jiangxi. The measures undoubtedly affected the manufacturing production. Therefore, the PMI figures, especially the manufacturing PMI are likely to have a small decline, but would still remain in the expansion zone.
Bitcoin moved further north sharply for 11.88% last week and closed above 26250.00. At the very beginning of this week, it extended the surge and is now trading around 27050.00.
After combining the suggestions by both two-line MA and RSI indictors, we might conclude that the bullish momentums remain strong, it is highly possible for Bitcoin to edge higher in longer term.
In coming one or two weeks, it is likely to be traded within 25600.00 and 28500.00 as they are significant support and resistance levels respectively at this stage.
Support: 25600.00, 19665.00, 16200.00
Resistance: 28500.00, 29000.00, 30000.00
USD Index (H4)
The greenback ended the upside movements of five consecutive weeks, it slightly rallied for around 0.10% and closed at 90.20 last week.
For technical aspect, both two-line MA and RSI support a sideways trend since two SMA crossed over each other repeatedly and RSI was hovering within 50-mark. Moreover, the market volatility is expected to be lower due to the New Year holidays.
Nonetheless, the chart also shows that USD is still confined within the downtrend channel. Therefore, the USD is likely to fluctuate moderately and remain above 90.00 for some period of time. However, it would resume the bearish momentums and take a breakout at 90.00 in longer term.
Support: 90.00, 88.20
Resistance: 91.80, 93.15
The EUR had a small rose last week and it reached a level that have not been seen since April 2018.
Technically, for RSI perspective, it penetrated the 50-interval from below, suggesting a potential uptrend. Furthermore, the two-line MA also set to achieve a golden cross soon according to the graph. Therefore, there might be an upward movement of EUR later and it is likely to climb up to challenge the resistance at 1.22700 again in the near future.
Support: 1.20600, 1.18000, 1.15000
Resistance: 1.22700, 1.23000
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