Dear Valued Clients,
During the year end holiday period, the market usually experience reduced liquidity in the FX spot and swap markets. All execution of orders or stop loss will be filled at best basis or subjected to the market conditions as spreads will widen during this period.
Swaps are still chargeable for positions held overnight during this period and hence, please ensure that there are sufficient funds in your account.
Kindly refer to the following trading hours of the respective products during the upcoming holiday period.
- CFD Equities
- CFD Indices
- Leveraged Forex
|26-Dec-22||Trading session will close early at 1.00pm SGT on 26 Dec 2022 and reopen at 6.05am SGT on 27 Dec 2022|
- Precious Metals, XAUUSD & XAGUSD
We wish you a happy holiday and thank you for trading with UOB Kay Hian.
– The U.S. dollar weakened against major currencies on Wednesday amid concerns that rising interest rates could push the U.S. economy into recession, while a loosening of China’s COVID restrictions boosted the yuan.
– Data on Wednesday showed U.S. worker productivity data beat forecasts but extended a weak trend, further muddying a debate on how far and how fast U.S. interest rates will rise. Market has been anticipating the Fed will soon slow its rate tightening pace, but recent upbeat U.S. employment, services and factory data has added uncertainty over the Fed policy outlook.
– The U.S. dollar was unchanged against the Canadian dollar after the Bank of Canada hiked its benchmark overnight interest rate by 50 basis points to 4.25%, the highest level in almost 15 years, and signaled the tightening campaign was near an end.
– The euro was up 0.3% at $1.0507. The euro has risen recently on signs that Europe’s economic downturn may be less bad than previously feared. The dollar was down 0.5% against the Japanese yen. The British pound was last trading at 1.2188.
– Spot gold held its ground at $1,784 per ounce in early Asian trade on Thursday, after a pullback in the dollar and U.S. bond yields as investors anticipate slower rate hikes from the U.S. Federal Reserve at its policy meeting next week.
Chart Focus AUD/USD
1. Buy AUD/USD recommendation.
2. Buy AUD/USD at 0.6715. Stop at 0.6685 and profit target at 0.6790.
3. A loosening of China’s COVID restrictions and anticipation of a slower pace of rate hike are both likely to weigh on the U.S. dollar.
4. Price ability to stay above the Fibonacci 62% correction point is a sign of a correction with Stochastic and MACD also hinting at a bullish price trend.
1. A loosening of China’s COVID restrictions is boosting risk sentiment and weighing on the safe haven U.S. dollar.
2. Anticipation of a slower pace of rate hikes from the U.S. Federal Reserve is likely to weigh on the U.S. dollar.
1. The price decline has managed to stay above the Fibonacci 62% correction point, hinting that the decline is just a correction.
2. Stochastic is rising while MACD is turning bullish. Both momentum indicators are hinting at a bullish price trend ahead.
USD/JPY – Price reached a high of 137.85 on Wednesday and went into a decline. The decline was supported by the 20EMA and if price can stay above the 20EMA, we are likely to test the high of 137.85 again but a movement below the 20EMA is likely to send price lower to 134.20 in the next few days. Stochastic is declining and is hinting at a price decline. However, both MACD and 20EMA are hinting at a price rally.
EUR/USD – In our last update on Tuesday, we had a sell call at 1.0495 but our call was wrong. Price moved to a high of 1.0549 on Thursday before declining to 1.0505. Price is currently in the middle of a range and is also sitting just above the 20EMA, which is hinting at a sideways movement. MACD is also flat and neutral. Stochastic is hinting at a price rally. We think price is likely to trade from 1.0600 to 1.0440 until there is a breakout. Follow in the direction of the breakout.
GBP/USD – Price was supported by the 20EMA overnight and 20EMA is also hinting at a bullish price trend. Stochastic is also rising and hinting at a price rally. MACD is turning bullish and is also hinting at a price rally ahead. We think price is likely to move higher to 1.2345 in the next few days. However a move below the 20EMA at 1.2175 is likely to send price lower to the previous low at 1.2105.
XAU/USD – Price rallied to a high of $1790.40 yesterday and the correction was able to stay above the 20EMA line at $1780.70. Stochastic is rising and is hinting at a rising price trend. MACD is also hinting at a price rally. 20EMA is bullish as well. We think price is likely to test the previous Monday’s high of $1809.80 again in the next few days. However a price move below $1773 would negate our bullish price view.
NZD/USD – Price has managed to bounce off the support at 0.6300 for most part of this week. Stochastic is currently rising and is hinting at a bullish price trend. 20EMA is rising and is hinting at a bullish price trend. MACD is turning bullish. We think price is likely to test the Monday’s high of 0.6440 in the next few days. A price move below 0.6300 would negate our bullish view and calls for a decline to 0.6150.
– The U.S. dollar held firm on Friday but was pinned down near 16-week lows against a basket of major currencies as data showing increased U.S. consumer spending in October emboldened investor hopes that the peak in interest rates was on the horizon.
– Data on Thursday showed that U.S. consumer spending in October increased at its greatest pace since January and the labour market remained resilient, with the number of Americans filing new claims for unemployment benefits declining last week.
– The greenback was 0.05% lower at 135.25 yen, having slipped as low as 135.045 yen earlier – the lowest since Aug. 18. The Japanese yen was the best performing Asian currency this week as it gained nearly 3% to recover from a 30-year low.
– The euro down 0.1% to $1.0512, after gaining 1% overnight to a fresh 5-month high at $1.0539, while sterling was last trading at $1.2237, down 0.13% on the day. The pound advanced 1.7% overnight and touched a 5-month high of $1.2311.
– Gold prices steadied around multi-month highs on Friday as markets hunkered down ahead of key U.S. payrolls data that could factor into the path of monetary policy, while copper stuck to a two-week high on hopes of a Chinese reopening.
Chart Focus AUD/JPY
1. Buy AUD/JPY recommendation.
2. Buy AUD/JPY at 92.10. Stop at 91.80 and profit target at 92.60
3. Easing of COVID-19 restrictions in China and interest rate differential are both aiding the Aussie dollar.
4. Price may have reached a bottom as MACD is warning that price has reached a bottom.
1. Easing of COVID-19 restrictions in China is aiding the Aussie and weighing on the safe haven yen.
2. Interest rate differential is in the Aussie dollar favour.
1. Price may have reached a bottom and could be moving higher.
2. MACD may be forming a divergence which is a warning price has reached a bottom.
USD/JPY – We had a sell call on yesterday at 137.40 but price only reached a high of 139.99 and our entry order was not filled. Price has reached a low at 135.00 this morning and we could be near to a low. Stochastic is inside the oversold zone and is hinting at limited downside. MACD remains bearish but could be forming a divergence warning of a possible price low. However, 20EMA is hinting at a strong bearish price trend.
EUR/USD – The rally continues and price is currently near to the resistance at 1.0540. Stochastic is in the overnight zone but looks like it will stay in the overbought zone for some more time. MACD remains bullish and is hinting at a bullish price trend. 20EMA is pointing up with a steep slope hinting at a strong bullish price trend. We could see price moving up to 1.0615 in the next 24 hours.
GBP/USD – Price reached a high 1.2309 overnight and has been declining. We think the price decline is likely to be halted by the previous resistance turned support line at 1.2152. From there we are likely to see a rally to test the previous high of 1.2152 again. Stochastic is in the overbought zone but both MACD and 20EMA are both hinting at a strong bullish price trend ahead.
XAU/USD – Price reached a high of $1804.45 overnight but the rally looks like it will continue to move higher to $1825 in the next few days. Stochastic is rising and is hinting at a bullish price trend. 20EMA is also rising with a steep slope hinting at a strong bullish price trend. MACD remains bullish but a divergence warning could be developing, hinting that price could be close to a high.
USD/CAD – Price is currently capped by the 20EMA at 1.3455. Stochastic is in the oversold zone and is hinting at a limited downside. MACD is near to the zero line and could move in either direction. MACD is neutral at the moment. 20EMA is hinting at a bearish price trend. If price can move above the 20EMA, it could be heading higher to 1.3575. However, if price is capped by the 20EMA, it could be heading lower to 1.3315. We prefer the downside.
– The U.S. dollar climbed on Monday as protests against COVID restrictions in China rattled financial markets, sending the yuan sliding and pushing nervous investors toward the safe-haven greenback.
– The COVID protests have flared and spread to several cities. Worries over the unprecedented wave of civil disobedience in a country where in-person protests are rare, the rising COVID cases as well as how Beijing will react to the situation kept investors on edge.
– The offshore yuan fell to an over two-week low in Asian trading, and was last roughly 0.6% lower at 7.24 per dollar. The Australian dollar, often used as a liquid proxy for the yuan, slid more than 1% to $0.6687. The kiwi slumped 0.65% to $0.6206.
– The yen was up about 0.5% to 138.46 per dollar gaining on the back of its safe haven status as well as a mix performance from US Treasury. The euro fell 0.43% to $1.0357, while sterling was down 0.51% at $1.2027
– Gold prices retreated on Monday morning as the U.S. dollar regained its strength as a safe haven as protests in China flared. With market pricing in a 50 basis points hike next month, holding cost is making the yellow metal expensive to investors.
Chart Focus GBP/USD
1. Buy GBP/USD recommendation.
2. Buy GBP/USD at 1.2030. Stop at 1.1995 and profit target at 1.2150
3. Divergence monetary policy is likely to aid the British pound against the U.S. dollar.
4. Price is likely to be supported by the 20EMA with MACD hinting at a bullish price trend.
1. The prospect of the Federal Reserve slowing monetary policy tightening is likely to weigh on the U.S. dollar.
2. High UK inflation is likely to lead to higher UK interest rate, aiding the British pound.
1. Price is supported by the 20EMA which is also hinting at a bullish price trend.
2. MACD remains bullish and is hinting at a bullish price trend.
USD/JPY – Price was capped by the 20EMA at 139.59 last Friday and has declined to 138.16 at the point of this writing. Our view remands the same as last Friday. We think price is likely to continue lower to 137.70 in the next couple of days ahead. Stochastic is near to the oversold zone and MACD remains bearish. 20EMA is also hinting at a bearish price trend. Only a move above 139.60 would negate our bearish price view.
EUR/USD – Price has declined over the past 48 hours and could be heading lower to test the support at 1.0221 as stochastic is hinting at a possible price decline. 20EMA is also hinting at a price decline but MACD remains bullish and is hinting at a price rally. Price could be caught in a range of 1.0480 to 1.0221 in the next few days. A break in either direction is likely to hint at the next directional move.
XAG/USD – Last Friday, we had a buy call at $21.15 which was filled this morning when price reached a low of $21.03. Our view remains unchanged from last Friday. We would recommend keeping stop at $20.80 and profit order at $22.10. Stochastic is declining and is hinting at a price decline but MACD remains bullish and is hinting at a bullish price trend. 20EMA is neutral at the moment.
XAU/USD – Price has been moving in a tight range for the past 48 hours while trying to find the next directional move. Price has stayed below the Fibonacci 50% of the decline from $1786.15 to $1731.45 at $1758.10 but is sitting on the 20EMA. We would prefer to watch the upside range at $1761 and the support at $1731 for directional clues. Follow in the direction of the breakout.
NZD/USD – Price reached a high of 0.6288 last Thursday and has been declining. The decline has reached a low of 0.6190 this morning. This could be a corrective decline and if price can stay above 0.6175, we can expect a rally to test the previous high of 0.6288 again in the next couple of days as MACD remains bullish and is hinting at a bullish price trend. 20EMA is neutral while stochastic is hinting at a price decline.