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‘Santa Rally’ could carry on

‘Santa Rally’ could carry on

Major markets are shut for the Christmas holiday today, and thus trading is expected to remain tepid in Asia. Liquidity is likely to be poorer due to the lack of market participants and a relatively empty market calendar this week.

Futures in Japan and South Korea opened mildly higher, suggesting sentiment remains positive and the ‘Santa Rally’ could carry forward towards year-end.

In Asia Pacific, major markets including Hong Kong and Australia are closed today.

Crude oil prices extended its upward trajectory and hit a 3-month high today, driven by a brighter economic outlook into 2020 and Saudi’s pledge to curb productions. Technically, Brent oil has broken out above a key resistance at US$ 66.25 and aims to reach the next level at US$ 68.5 (76.4% Fibonacci Retracement). This could give a boost to the energy sector and Singapore’s offshore & marine stocks.

The S&P 500 Index was flat over the last three trading sessions and its overall trend remains bullish. Fibonacci extension suggests that the next key resistance level could be found at around 3,263 points (161.8%), followed by a psychological resistance at 3,300 points.

Hang Seng Index has consolidated at around 28,000 points this week and momentum indicators DMI, MACD, RSI have shown early signs of weakness. This might also be due to the lack of participants in the holiday season. Immediate support levels can be found at 27,700 and then 27,400 points.

In the currency market, riskier currencies namely AUD, NZD and SEK outperformed other G10 peers, whereas safe-havens like JPY, USD, EUR and CHF were lagging. This pattern suggests overall sentiment is optimistic and could provide a greenlight for Asian trading today.

Crude Oil Brent - Cash



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