UK hand in hand with Jap, EURO has plan with China

Equity market:

(Source: KVB PRIME)

Manufacture industry started to recover which leads to Dow to increase by 0.48% at 27665.64, while SP500 closed up 0.05% at 3340.97 and NASDAQ remained weak and fall 0.6% at 11087.4 due to innovation and technology industry fall.

UK climbed back 0.48% at 6032.09 while DAX remained weak and closed down 0.05% at 13202.84.

Chinese market was bullish on friday. Shanghai Stock index closed up 0.79 %, SZSE Component Index increased 3.25% . GEM index recovered 2.16%.

Precious metal forward contracts:

Gold opened high and remained so. Its price ranged from $1937-1952. It closed down 0.3% at $1939.40 per ounce.

Sliver hit the day high around $ 27 but went lower and closed at $26.72 by 0.52% fall.

Oil forward contracts:

WTI and Brent oil went slightly high closed up 0.79% at $37.30 and 0.23% at $39.79 per barrel prospectively.

Currency pairs：

USDX：close up 93.37   -0.150%

EUR/USD：close up 1.18447 -0.200%

GBP/USD：close down 1.27964    -0.053%

AUD/USD:  close up 0.72777      -0.288%

NZD/USD：close up 0.66616 -0.227%

USD/CAD：close down 1.31872   -0.008%

USD/JPY：close down 106.086     -0.046%

Global fundamental ：

US

U.S. Treasury Department released their report last week which shows that the current government deficit is accumulated to $3 trilion much more than the same time in 2009. Budget office predicted that the underlaying asset cost for issuing government debt will refresh new low in this 50 years.

EURO

World Health Organization shows that there are over half million confirmed COVID-19 case in Spain till 13^th Sept. 2020, and daily confirmed cased on the day is over 30 thousand, which is a new high. Both France and German are planning to prolong current employment supporting plan.

German Federal Statistical Office said that from April to June, China imported nearly 23 billion euros worth of goods ($27.25 billion) from Germany, replacing the US as the biggest buyer of German goods for many years. Local media reported that this is  a result of quick recovery from coronavirus.

Japan and Britain’s broad agreement on a bilateral free trade pact came as a relief for both sides on 11^th Sept, 2020.“It was a tough negotiation, but we were able to reach a broad agreement in just three months,” Foreign Minister To shimitsu Motegi told a news conference. It is the first trade agreement not signed with the EUor the US in the past 40 years.

Canada

Canada slapped C$ 3.6 billion retaliatory tariffs on US aluminium goods. More details will be announced shortly. List has been released is including products from swing stats, which may push Trump to lover the tariffs before election.

Crude oil

As showed by OPEC data, UAE oversupplied in both July and August and violated OPEC reduction agreement. Oversupply is a historical problem for OPEC.

Major Assets Analysis：

Please note: testing new parameters and just for reference

EUR/USD&GBP/USD

As last week predicated, reconsolidation is required to both EUR and GBP price further development. But strategic bases for the two currencies are different. GBP is over sold while EUR is in a reasonable price range. Despite EU upcoming online meeting with China, there is no fundamental influence at current stage. Technically, EURO will follow the fall from beginning of Sept, which is our main ideal for mid-term placement. For short target, we consider it will retrace to 1.187. For GBP, with strict risk control, participation for retracement targeting at 1.2855 is valid. 

(Source: KVB PRIME)

AUD/USD

AUD price loss its support due to stabilized commodity price. The current price momentum mainly come from USD. Our layout will be the same as last week. Participation in short term reconsolidation is not advised due to limited profit margin. 

(Source: KVB PRIME)

XAU/USD

Gold price fluctuation shrinks. Price data from mid of August to Sept was $59 daily fluctuation with 87% within 1.5 stand deviation while current 2 week is $36 with 96% within 1.5 stand deviation. Trading volumes of markets makers and exchanges have been cut off in terms of spots, forwards and CFDs, but it makes technical analysis becomes more reliable. For intraday layout, the price will be back to $1950 and we can expect $7 down during US market time.

(Source: KVB PRIME)

USDX

Without huge changes in the fundamental today, our price analysis will be depended on technical supports. Price is supported by both of moving average but it will go down $0.13 further below the weekly moving average during Asia and Euro market. In term of mid term placement, we still would like to long USDX in long term conservative targeting at 93.4.

(Source: KVB PRIME)