Kospi Gains Following Wall Street Rally
South Korean stock market, Kospi, rose sharply today, Wednesday (16/12), following a rally on Wall Street on Tuesday. But investors are likely to be cautious ahead of the announcement of the decision of the Federal Reserve’s monetary meeting Thursday early morning.
Stable oil prices make Wall Street rally, energy and financial sectors rose more than 2.0%. The Federal Reserve is expected to raise interest rates for the first time since 2006, US economic data that was released recently also seen supporting the desire of the Fed. The labor market continues to show resilience, and annual inflation starts to rise.
Spot Kospi (KS11) rose 1.39% to 1959.91, Kospi (KS200) rose 1.4% to 242.14. Futures Kospi traded while the range of 240.30 at 8:18 pm, away from the lowest level ahrian 238.40
Technically, the index on the trading session today, Wednesday (16/12) likely to strengthen, test positive trend. At the M15 chart bullish hammer formation to provide opportunities for the index to move upside. However, the volume tends to increase, as well as an early indication of bullish index. In addition, RSI, the M15 chart, was oversold, signaling upside.
It is estimated, the index test the first resistance level of 241.25 and 242.00. If it fails at 240.70, then the next index is expected to tend to retest the support level 240.50 and continued up to the possibility of being in the 240.00 area.
Euro Get Extra Effort Strength
Euro exchange rate movements which strengthened from the beginning of trading continued the trend of previous trading, the stronger the mid European session yesterday by the ZEW sentiment survey which showed increased optimism about the prospects of the German economy.
ZEW survey showed investor confidence index in December increased for the second consecutive month in October after briefly falling to valuation as the worst since 2014. Sentiment indicator rose more than expected 5.7 points to 16.1 in December. This is the highest score since July, when the time was 29.7. In this assessment is expected to rise to a position of 15 index points.
In terms of the movement of the US dollar index trading yesterday afternoon trying to rise from the weakening observed since the beginning of trade responds to US inflation data indicated the data show a decline from the previous period.
Technically, today’s trading session on Wednesday (16/12), the pair Euro-dollar likely to move in a positive trend.
The strengthening Euro is mainly expected to immediately re-examine the minimal resistance at 1.1000 and maximum 1.1050. Meanwhile, if the Euro unable to break and stays below 1.0942 then the other alternative scenario that Euro likely to test support in 1.0900 area and 1.0850.
Gold Consolidated
Gold is still moving in a trading range consolidation on Tuesday (15/12) night, after the data consumer price inflation in the United States flat in November.
New York spot Mercantile Exchange gold for December delivery dropped -0.10% to $ 1.062.20 troy ounce. The US Commerce Department said that consumer prices unchanged from the previous month, to meet the expectations and follows a gain of 0.2% in October. In annual terms, consumer prices were 0.5% higher than the same month the previous year.
A separate report reported by the Federal Reserve Bank of New York that New York manufacturing index fell to -4.6 this month from -10.7 in November. Markets had expected the index to rise to -6.0 in December. Meanwhile, the Federal Reserve is widely expected to raise interest rates for the first time in nearly a decade at the end of a two-day policy meeting on Thursday morning. The central bank will also release the latest forecast for economic growth and interest rates.
The yellow metal is in the 10% annual decline in 2015, the third annual loss in a row, as speculation interest rates dominated market sentiment for most of the year. Expectations of interest rate rises is considered bearish for gold.
Meanwhile, on the other Comex trading, silver futures for February delivery fell 2.0 cents, or 0.15%, at $ 13.67 a troy ounce level. Prices dipped to $ 13.62 on Monday, a level not seen since August 2009, copper fell on a day related to the assets ahead of a Federal Reserve policy meeting.
Technically, gold on the trading session today, Wednesday (16/12) potential reversal, testing positive trend, but prone to profit taking. RSI indicator tends to re-test resistance and aiming the bullish channel, but Bollinger Band begins to shrink, thereby giving impetus for gold to the downside.
It is estimated that the gold price immediately prior to test resistance in the area of at least 1068.10 and re-test the maximum level of 1073.87. But if the gold price could not break and stays below 1063.80 then predicted gold prices could potentially test the Support 1060.78 and 1055.40.
