FUNDAMENTAL AND TECHNICAL ANALYSIS REPORT – 28 November 2022
28 Nov 2022
Conflicts in Shanghai as COVID demonstrations spread throughout China
Asian stock market closed red on Friday. The Shanghai Composite is up 0.40% at 3101.69 Overall, the Singapore MSCI is flat 0.00% at 293.95. Over in Hong Kong, the Hang Seng Index is down 0.49% at 17573.58. In Japan, the Nikkei 225 is down 0.35% at 28283.03, while the Topix index is down 0.040% at 2018.00 South Korea’s Kospi is down 0.14% at 2,437.86. Australia S&P/ASX 200 up 0.24% at 7259.50.
Top News of the Day:
Hundreds of demonstrators and police clashed in Shanghai on Sunday night as protests over China’s stringent COVID restrictions flared for a third day and spread to several cities in the wake of a deadly fire in the country’s far west.
The wave of civil disobedience is unprecedented in mainland China since President Xi Jinping assumed power a decade ago, as frustration mounts over his signature zero-COVID policy nearly three years into the pandemic. The COVID measures are also exacting a heavy toll on the world’s second-largest economy.
Protesters also took to the streets in the cities of Wuhan and Chengdu on Sunday, while students on numerous university campuses around China gathered to demonstrate over the weekend.
Market Summary as per 25/11/2022:
European equities Friday closing. The DAX futures contract in Germany traded up 0.01% at 14541.38, CAC 40 futures up 0.08% at 6712.48. UK 100 futures contract in the U.K. up 0.27 at 7486.67
In the U.S. on Wall Street, the Dow Jones Industrial Average Closed up 0.45% at 34347.03. The S&P 500 up 0.08% at 4027.72 and the Nasdaq 100 is down 0.52% at 11226.36, NYSE closes 0.39% up at 15605.68.
Top Market News Today:
In the Forex market, GBPUSD down 0.12% at 1.2095. The USDJPY up 0.51% at 139.12 The USDCHF up 0.25 at 0.9455. EURUSD down 0.06% at 1.0402. EUR/GBP up 0.06% at 0.8597. The USD/CNY up 0.33% at 7.1754 at the time of writing.
In the Commodity market U.S. Gold futures down at 0.04% $1,754.68. Elsewhere, Silver futures down 0.27% at $21.485 per ounce, Platinum down 0.36% at $984.01 per ounce, and Palladium up 0.21% at $1856.71.
Brent Crude Oil flat 0.00% at $83.71 per barrel.
In the Cryptocurrency Markets, Bitcoin at 16534.90 up 0.53%, Ethereum up 0.63% at 1212.48, Litecoin at 75.48 down 1.23%, at the time of writing.
Top Market Segment to Watch Out Today:
Brent crude oil: – Oil prices fell sharply to a near 11-month low on Monday as escalating protests in several major Chinese cities ramped up concerns over increased economic disruptions in the world’s largest crude importer,
Brent oil futures dropped 2.6% to $74.31 a barrel in early Asian trade, while West Texas Intermediate crude futures sank 2.4% to $81.69 a barrel. Both contracts extended sharp declines from last week and were trading at their weakest level since early-January.
Civil unrest broke out in several major Chinese cities over the weekend, as a growing number of civilians took to the streets to express their discontent with the country’s strict zero-COVID policy.
US: The dollar climbed on Monday as protests in China against the government’s anti-COVID policies made investors turn away from riskier assets and consigned the Chinese yuan to a more than two-week low against the safe-haven greenback.
The protests have flared across China and spread to several cities in the wake of an apartment fire that killed 10 people in Urumqi in the country’s far west. Hundreds of demonstrators and police clashed in Shanghai on Sunday night.
Investors were worried over how the government in Beijing would react to the wave of civil disobedience when COVID cases are rising.
The offshore yuan fell to an over two-week low in Asian trading and was last roughly 0.4% lower at 7.2242 per dollar.
The Australian dollar, often used as a liquid proxy for the yuan, slid more than 1% to $0.6681. The kiwi fell 0.72% to $0.6202.
“If the RRR cut is the only monetary policy tool that the PBOC is going to implement, it may not lead to a significant increase in bank lending,” said Iris Pang, chief economist for Greater China at ING.
“Companies are currently facing weaker retail sales from a higher number of COVID cases and falling home prices from unfinished home projects.”
Euro Zone: –
The European Central Bank will likely increase interest rates by smaller increments next year if further hikes are needed, as stated on Sunday, by governing council member Gabriel Makhlouf.
The ECB began to push up rates at its fastest pace on record in July and markets are betting on a 50-75 basis-point increase at the next Dec. 15 meeting. Makhlouf said this week that his mind is open on the size of that hike.
While policymakers have been adamant that rates need to increase further to help lower inflation, the account of their last meeting published on Thursday showed they cannot fully agree on their ultimate destination or pace.
“When we get into next year, the likelihood is that if the rates go up, they’ll go up by smaller increments,” Makhlouf, the Irish central bank chief, told Ireland’s Sunday Independent newspaper in an interview.
Top Economic Releases Today:
- EUR: ECB`s De Guindos Speaks at 19:30
- USD: FOMC Member Bullards Speaks at 22:30
- AUD: Retail Sales (MoM) (Oct) Forecast 0.5, Previous 0.6% at 06:00
- AUD: RBA Governor Lowe Speaks at 04:30
- CAD: Current Account (Q3) Forecast 6.6B, Previous 2.7B at 19:00
GBPUSD TECHNICAL ANALYSIS
TRADE SUGGESTION – BUY AT 1.20980, TAKE PROFIT AT 1.21917, SL AT 1.20229
EURUSD TECHNICAL ANALYSIS
TRADE SUGGESTION – BUY AT 1.04491, TAKE PROFIT AT 1.05312, SL AT 1.03780
USDJPY TECHNICAL ANALYSIS
TRADE SUGGESTION– SELL AT 137.600, TAKE PROFIT AT 135.873, SL AT 139.212
AUDUSD TECHNICAL ANALYSIS
TRADE SUGGESTION- BUY AT 0.67296, TAKE PROFIT AT 0.67620, SL AT 0.66802
NIKKEI 225 INDEX TECHNICAL ANALYSIS
TRADE SUGGESTION – BUY AT 28262, TAKE PROFIT AT 28429, SL AT 28036
BRENT CRUDE OIL TECHNICAL ANALYSIS
TRADE SUGGESTION– SELL AT 82.30, TAKE PROFIT AT 79.35, SL AT 83.46
GOLD TECHNICAL ANALYSIS
TRADE SUGGESTION– BUY AT 1753.23, TAKE PROFIT AT 1771.45, SL AT 1731.28
BITCOIN TECHNICAL ANALYSIS
TRADE SUGGESTION- SELL AT 16041.02, TAKE PROFIT AT 15627.76, SL AT 16552.68