November 2022 Macro Market Commentary

Bitcoin –

Bitcoin broke lower on the news concerning the fourth largest cryptocurrency exchange by trading volume FTX. The range which had held since June 2022 between $17,500 and $26,000 saw prices reach $16,862 on 9th November. Until then there had been few catalysts to move prices in either direction with the digital asset markets primarily following the direction of equities.

• The filing of Chapter 11 bankruptcy protection in the United States by FTX, the fourth largest cryptocurrency exchange by trading volume, sent reverberations across the digital asset ecosystem. BlockFi, a cryptocurrency lending platform, which attempted to recover their business with the support of FTX from issues earlier in the year through a loan, had no option but to also file for Chapter 11 bankruptcy protection.
• Fidelity has launched its cryptocurrency trading product, Fidelity Crypto, which allows retail clients to trade Bitcoin (BTC) and Ethereum (ETH). The product and services, including custodial services, education and research, is provided by the company’s digital asset arm, Fidelity Digital Assets. In the past, Fidelity has launched an exchange traded fund (ETF) to provide investors wanting exposure to the digital asset industry through their Fidelity Crypto Industry and Digital Payments ETF (FDIG).

DAILY TREND: DOWN

Bitcoin dropped below the range between $26,000 and $17,500 which had held since June. News of concerns surrounding centralized exchange FTX broke the headlines early November sending bitcoin price sharply lower.

Price action remained sideways throughout the rest of the month. XBT closed the month lower at $17,109 with a -16.2% change.

UPCOMING HIGH IMPACT EVENTS

• Spring 2024 bitcoin halving event

US Dollar –

The U.S. Dollar Index ® (USDX) lost almost 5.00% of its value in November to close at 105.90, the largest monthly loss since 2010.

• The Federal Reserve raised rates by 75 basis points at the meeting held on 2nd November bringing the Federal Funds rate to a target range of 3.75% — 4.00%, its highest level since March 2008. The USDX closed the day at 111.23 with a loss of 0.12%.
• Nonfarm Payrolls data released showed 284,000 new jobs were created during October (revised from 261,000) to exceed expectations of 200,000. Whilst this was positive, it represented a decline compared to the prior month after September came in with an increase of 315,000 new jobs (revised upwards from 263,000). The USDX closed the day at 110.77 with a loss of 1.86%.
• Core Inflation (all items less food and energy) took an unexpected fall to record an increase over the last 12-months at 6.3%, down from 6.6%, in September. The USDX closed the day at 108.09 with a loss of 1.92%.

DAILY TREND: DOWN

INDEX WEIGHTING:
EUR 57.6% | JPY 13.6% | GBP 11.9% | CAD 9.1% | SEK 4.2% | CHF 3.6%

After a bullish end to October, weakness came into the market as the U.S. Dollar Index ® began trading in the Asian and European sessions on 1st November.

The bearish momentum reversed in the early part of the U.S. session even though ISM Manufacturing PMI data for October was released 1st November showed manufacturing output continued to slowdown. The data came out at 50.2, which was slightly above expectations (50.0) although fell short of September’s release at 50.9.

The demand for the U.S. Dollar continued (which coincided with a test of the midpoint of the 4-hour Bollinger Bands) to claw back most of the earlier losses. The U.S. Dollar Index ® closed the day at 111.36 with a loss of 0.07%.

The 2nd November started with little movement during early trading as the market eagerly awaited the Fed announcement. First up for the day was ADP Employment Change. Figures released showed private sector jobs increased by 239,000, which was above market expectations of 195,000 and the downwardly revised prior month figures at 192,000, which was welcomed news.

Later in the day the Federal Reserve announced another 75 basis points (bps) rate rise, this was the fourth consecutive 75 bps hike, raising its benchmark rate to a range of 3.75% to 4.00% and the sixth rate rise since March 2022. The tough monetary policy stance continued as a means to rein in persistently high inflation although concerns were expressed about the wider economy and the financial difficulties this will cause to millions of households and businesses alike.

After a day where the market seesawed from a low of 110.26 to test the midpoint of the Daily Bollinger Bands hit resistance and drop the U.S. Dollar Index ® ultimately closed the day at 111.23 with a loss of 0.12%.

The U.S. Dollar bulls returned with vigor on 3rd November and the U.S. Dollar Index ® gapped up.

ISM Service PMI data for October was released, recording 54.4 against expectations of 55.5 and a slowdown on the prior month of 56.7, nonetheless the bulls gained momentum as it blasted through the midpoint of the Daily Bollinger Bands. The U.S. Dollar Index ® closed with a gain of 0.69% at 112.80.

Nonfarm Payroll data released on 4th November announced 284,000 new jobs were created during October (revised upwards from 261,000) beating market expectations of 200,000 although a decline on the revised numbers from the prior months recorded figures which reported a gain of 315,000 (revised from 263,00).

Data published also revealed that the unemployment rate for October had unexpectedly increased to 3.7% (from 3.5% the prior month). Wages continued to rise, with average hourly earnings increasing by 0.5%, a slight increase on the rise published for September. After initial reactions were mildly positive, the U.S. Dollar Index ® reversed and the bears gained control. The U.S. Dollar Index ® traded lower to close with a loss of 1.86% at 110.77, a significant weakness against the basket of currencies traded within the index.

The U.S. Dollar Index ® closed the trading week ending 4th November with a modest gain of 0.09% at 110.77.

The bearish momentum observed during Friday’s trading continued into the following trading week and the U.S. Dollar Index ® closed on 7th November with a loss of 0.91% at 109.99.

Trading on 8th November saw the bearish sentiment continue as money flowed out of the safe haven after the demand for the U.S. Dollar dropped. The U.S. Dollar Index ® traded lower until the market reached the lower boundary of the Daily Bollinger Bands where buyers stepped in and the U.S. Dollar Index ® lifted to regain some of the earlier losses. The U.S. Dollar Index ® closed the day with a loss of 0.42% at 109.54.

The demand for the U.S. Dollar drove the market higher throughout the majority of trading on 9th November and the U.S. Dollar Index ® closed at 110.46 with a gain of 0.76%.

The latest inflation figures released on 10th November showed the pace of inflation slowed for a fourth consecutive month as Consumer Price Index (CPI) data for all items 12-month ending October announced prices rose by 7.7% falling from 8.2% the prior month. This represented the lowest 12-month increase since January 2022.

The Core inflation rate, which represents all items excluding food and energy, softened to 6.3% over the 12-month period ending October, compared to data released for September which represented a 40-year high at 6.6%.

U.S. Dollar Index ® after making a high for the day at 110.89, when it pierced the Daily 20 EMA hit a pocket of selling pressure within a 4–hour resistance area at 110.79–111.17 and the bears took control to send the market lower. The U.S. Dollar Index ® closed the day below the lower boundary of the Daily Bollinger Bands at 108.09 with a loss of 1.92%.

As inflation is set to play a key role in interest rate decisions throughout 2022, the ICE U.S. Dollar Information Expectation Index Family is a great tool to help plan for the future. The chart below provides the historical Index setting over the past year:

The bearish momentum continued into trading on 11th November which was further exacerbated as the Michigan Consumer Sentiment Index published below expected figures of 54.7 against expectations at 59.5 and September data at 59.9. The U.S. Dollar Index ® closed the day at 106.16 with a loss of 1.75%

The U.S. Dollar Index ® closed the week of 11th November at 106.16 with a loss of 4.36%.

Monday 14th November trading was lackluster and the U.S. Dollar Index ® closed an inside day at 106.53 with a small loss of 0.12%. The market struggled to gain any clear direction during trading on 15th November and after reaching a low of 105.16, the market rose as buyers returned. The U.S. Dollar Index ® closed the day down 0.57% at 105.29, just inside the lower boundary of the Daily Bollinger Bands.

On 16th November, Retail Sales data surprised the market as data showed a growth of 1.3% against market expectations of 1.0% and above the prior month’s flat recording. Even with this positive news, the U.S. Dollar Index ® struggled to lift and closed the day at 106.15 with a loss of 0.30%.

Throughout the last two trading days of the week, the U.S. Dollar Index ® slowly began to rise posting higher closes with an overall gain of 0.54% over this period. The U.S. Dollar Index ® closed the week of 18th November with a small gain of 0.16% at 106.83.

The demand for the U.S. Dollar continued into Monday’s trading and bulls drove the market higher on 21st November. The market reached a high of 107.90, which coincided with a resistance area on a 4-hour timeframe at 107.95–108.32 before it pulled back slightly. The U.S. Dollar Index ® closed the day up at 107.73 with a gain of 0.77%.

The resistance area held and bears regained control during trading on 22nd November and the U.S. Dollar Index ® traded lower throughout the day to close down at 107.12 with a loss of 0.42%.

The bearish moment gathered pace on 23rd November as money continued to move away from the safe haven. Data released for Durable Goods Orders for October showed an increase in orders by 1.0% after September’s revised figures published an increase of 0.3% (downwardly revised from 0.4%) and above market expectations of 0.4%. This had little impact on the direction of the market after release.

Nondefense Capital Goods Orders ex. Aircraft also released on 23rd November showed significant improvement as data published an increase of 0.7%, above market expectations of 0.% and the downwardly revised -0.8% data released for September (revised from -0.7%), again little impact at the time of release.

FOMC minutes released confirmed the rate rise announced earlier in the month and gave indications that the Federal Reserve may adopt smaller rate rises moving forward. Whilst inflation is unlikely to drop anywhere close to the target range for some time some officials expressed concerns over the impact the rises will have with financial stability and the economy. The U.S. Dollar Index ® closed 23rd November at 105.97 with a loss of 1.01%.

After the movement in the market the prior day, trading on 24th and 25th November was sideways and whilst each day posted a slight increase on open, a gain of 0.08% and 0.07% respectively there was little overall movement in any direction. The U.S. Dollar Index ® closed the week of 25th November with a loss of 0.93% at 105.92.

During the final week of November trading the U.S. Dollar bulls drove the market higher during the early part of the week to close on 28th November at 106.63 with a gain of 0.48% and 29th November at 106.77 with a gain of 0.15%.

On 30th November ADP Employment Change Figures released showed private sector jobs increased by 127,000 which was significantly below market expectations of 200,000 and the prior month figures at 239,000.

Also out on 30th November was GDP data (preliminary) which brought welcomed news as the U.S. economy expanded by an annualized 2.9% for quarter three, exceeding expectations of 2.6% and a gain on the prior month’s preliminary figures of 2.6%. Even on this news, the U.S. Dollar bulls failed to maintain control and as the market reached overhead resistance at 106.71–107.14 on a 4-hour timeframe weakness came and the bears returned. The U.S. Dollar Index ® dropped to close at 105.90 with a loss of 0.72%.

The U.S. Dollar Index ® closed the month with a loss of 4.97% at 105.90 as the market continued to drop from September’s high. The uptrend was broken on the weekly timeframe during November and a new downtrend had formed. On the daily timeframe, U.S. Dollar Index ® broke to the downside into a confirmed downtrend.

UPCOMING HIGH IMPACT EVENTS

• Thr 1 Dec ISM Manufacturing PMI (Nov)
• Fri 2 Dec Nonfarm Payrolls (Nov)
• Mon 5 Dec ISM Services PMI (Nov)
• Fri 9 Dec Michigan Consumer Sentiment (Dec) PREL
• Tue 13 Dec Consumer Price Index (Nov)
• Wed 14 Dec Fed Interest Rate Decision
• Wed 14 Dec Fed’s Monetary Policy Statement
• Wed 14 Dec FOMC Economic Projections
• Wed 14 Dec FOMC Press Conference
• Thr 15 Dec Retail Sales (Nov)
• Thr 22 Dec Gross Domestic Product Annualized (Q3)
• Fri 23 Dec Durable Goods Orders (Nov)
• Fri 23 Dec Nondefense Capital Goods Orders ex. Aircraft (Nov)

South Korean Won –

The South Korean Won continued to gain ground against the U.S. Dollar in November and closed at 1301.63 KRW with a gain of 8.69%.

• S&P Global Manufacturing PMI data rose unexpectedly to post an increase to 48.2 for October, which beat expectations of 46.1 and data released for September at 47.3.
• Consumer Price Index (CPI) for all items 12-month ending October released on 1st November showed inflation ticked up to 5.7% from 5.6% the prior month to come out above market expectations of a 5.6% increase.
• Industrial Production data published for the 12-month ending October contracted to -1.1% to record a drop on the prior months’ revised figures of 0.7 % (revised downwards from 0.8%) and below market expectations of a flat recording. Monthly data published for the month ending October showed a decline at -3.5% against expectations of a decline of -1.0% and the prior month release of -1.9% (revised downwards from -1.8%).

DAILY TREND: DOWN

The USDKRW on the first day of November trading met resistance at the midpoint of the Daily Bollinger Bands combined with the Daily 10 SMA crossover. The bears gained control and the USDKRW dropped to close the first day of November trading down at 1416.00 with a loss of 0.67%.

The bearish momentum continued into the following trading day and the USDKRW closed lower. The bulls returned on 3rd November and the pair gapped up although resistance at the midpoint of the Daily Bollinger Bands held and ultimately the pair closed marginally down on the day at 1423.61 with a loss of 0.09%. The significant downward pressure continued on the final trading day of the week where the bears drove the pair lower to close with a loss of 1.43% below the lower boundary of the Daily Bollinger Bands.

The first week of November trading the USDKRW closed at 1403.27 down 1.29%.

The bearish momentum continued throughout the following week and the USDKRW traded lower closing negative for five straight days as the demand for the U.S. Dollar continued to decrease to the advantage of South Korean Won bulls. This was also the first time since June 2021 the pair closed below the midpoint of the Weekly Bollinger Bands. The pair closed within a daily support area nested within a weekly support area at 1315.30–1295.39.

The second week of trading the USDKRW closed at 1313.67 down 6.39%. This was a significant strengthening of the South Korean Won with it being the quote in the pair.

The bulls returned in the third week of trading as the daily support area at 1313.52–1308.38 nested within the wider weekly area held. The bulls drove the pair higher to close trading on Monday 14th November at 1323.83 with a gain of 0.77%. The bears applied pressure the following day and the pair dropped to reach a low of 1308.45 before support was found and the demand for the U.S. Dollar increased to push the pair off the low. Ultimately, the pair closed the day down 0.58% at 1316.20.

Demand for the U.S. Dollar continued to build on 16th and 17th November and the pair recovered to close higher for two consecutive days with a gain of 2.01%. The pair pulled back slightly on the final trading day of the week to close down by 0.25% at 1339.69.

The USDKRW ended the week with a gain of 1.98%. The first positive close since mid-October 2022.

The bullish sentiment continued into Monday’s trading and the USDKRW rallied through the Daily 10 SMA to close with a 1.46% gain at 1359.29.

The bears returned the following day and the USDKRW traded lower for three consecutive trading days with a loss of 2.41% over this time. The bulls came back on the final trading day of the week, 25th November to close up 0.59% on the day.

The USDKRW closed the trading week at 1334.46 with a loss of 0.39%.

The bullish momentum from Friday continued on Monday and the market closed with a gain of 0.40%. The bears regained control on 29th November and the pair dropped throughout the day to close down at 1325.33 with a loss of 1.07%. The bearish sentiment continued into the final trading day of November. The USDKRW dropped through the daily support area to close with a loss of 1.79% for the day at 1301.63 although remained within the weekly support area 1315.30–1295.29.

The USDKRW is in a downtrend on a daily chart whilst it has reached a critical point on the weekly. The weekly trend remained up. The USDKRW closed the month at 1301.63 with a loss of 8.69%, the second monthly gain for the South Korean Won since May 2022. Also the largest monthly gain against the U.S. Dollar in over 11 years.

UPCOMING HIGH IMPACT EVENTS

Singapore Dollar –

The Singapore Dollar closed the month stronger against the U.S Dollar at $1.3612, a gain of 3.84%. The strongest monthly performance by Singapore Dollar against the U.S. Dollar since March 2016.

• PMI Manufacturing data released on 2nd November showed a continued decline in manufacturing dropping to 49.7 for October, slightly down on the previous month of 49.9.
• Consumer Price Index (CPI) data released showed inflation whilst it remained high declined as CPI all items for 12-month ending October recorded an increase of 6.7% which fell below expectations of 7.6% and the prior month increase which was a 14-year high of 7.5%. Core inflation dropped to 5.1% for 12-month ending October compared to September, which recorded the sharpest rise at 5.3%, the most seen in November 2008.
• Industrial Production data released on 25th November showed a decrease in manufacturing output for the period 12-month ending October as manufacturing dropped to -0.8%, although it was slightly better than market expectations of -0.9% it fell significantly below the prior month. October month on month data showed manufacturing output exceeded expectations at 0.9%, significantly above -0.3% expected and the prior month data of 0.2% (revised from 0%).

DAILY TREND: DOWN

A challenging start to November as the bulls and bears fought to gain overall control. After reaching a high of 1.4165, the USDSGD pulled back slightly to close marginally down by 0.07% at 1.4145. The bulls however gained momentum and drove the pair higher during the following two trading days to post a gain of 0.47, although the pair met resistance at the midpoint of the Daily Bollinger Bands where the bears returned.

The USDSGD dropped on the final trading day of the week on 4th November as the U.S. Dollar bears took control. The pair closed the day with a loss of 1.25% at 1.4033. A significant gain for the Singapore Dollar (being the quote).

The USDSGD closed the first week of November trading with a loss of 0.52%.

The bearish sentiment continued into the following week of trading and the pair traded lower closing with a small loss of 0.34% during the first two days until the USDSGD reached the lower boundary of the Daily Bollinger Bands where support was found.

Buyers stepped in on 9th November and the USDSGD took a bounce to close up for the day up at 1.4025 with a gain of 0.28%.

The bullish move was temporary as the bears returned and the USDSGD dropped heavily during the two subsequent trading days. The pair closed down at 1.3708 with a loss of 2.26% in a daily area of support at 1.3727–1.3666.

The USDSGD closed the week with a loss of 2.31%.

The USDSGD bulls waited in this support area and the pair pushed slightly higher on 14th November to close the day with a modest gain of 0.03% at 1.3719 before retesting support.

The USDSGD traded within this support area throughout the week dropping slightly below before buyers stepped in. The pair lifted from the area on 17th November to post a gain of 0.28% before dipping back down and finding buyers once more. The pair closed Friday’s trading with a modest 0.03% gain.

The USDSGD closed the week at 1.3747 with a gain of 0.24%.

The bullish momentum gathered pace on Monday 21st November as the USDSGD rallied from the support area to close the day with a gain of 0.44%.

However, the momentum reversed when the bears returned on 22nd November and the demand for the U.S. Dollar dropped. The USDSGD closed down 1.3777 with a loss of 0.28%. The pair continued to trade lower throughout the remainder of the week to revisit the support area where buyers again held their ground.

The USDSGD closed the week with a loss of 0.05% at 1.3748.

The bulls returned during trading on 28th November and again the pair rose from the support area but momentum waned. The USDSGD closed with a gain of 0.32% at 1.3791.

The bears returned on 29th November and the pair dropped back into the support area to close at 1.3732 with a loss of 0.40%.

On the final day of trading, the bears drove the pair lower and the USDSGD closed at 1.3612 with a loss of 0.87% and broke the daily support area.

The downtrend continued on the daily timeframe. The weekly uptrend broke and a new downtrend formed. The USDSGD closed the month with a loss of 3.84% at 1.3612 to post the largest monthly gain the Singapore Dollar has made against the U.S. Dollar since 2016.

UPCOMING HIGH IMPACT EVENTS

Chinese Yuan –

The Chinese Yuan Renminbi reclaimed the prior month’s losses to gain 3.95% against the U.S. Dollar and closed at 7.0427 CNY to the U.S. Dollar.

• Consumer Price Index (CPI) data released on 9th November showed inflation eased to an annual rate of 2.1% for 12-month ending October. This increase fell short of expectations of 2.4% and the 2.8% reported for 12-month ending September.
• Retail Sales figures for 12-month ending October showed an unexpected decline by 0.5% against 1.0% expected and significantly below 2.5% reported for 12-month ending September. Much of the decline was attributed to the rising number of COVID infections and the impact of strict restrictions in several large cities.
• The NBS Manufacturing PMI data released showed a decline in manufacturing output for November with a drop to 48.0 against 49.2 reported for October and below expectations of 49.0. Non-Manufacturing PMI data for November showed a sharp decline as figures released 46.7 for November against 48.7 and below expectations of 51.7.

DAILY TREND: SIDEWAYS/DOWN

On the first day of November trading the USDCNH reached a high of 7.3566 where it met resistance near the upper boundary of the Daily Bollinger Bands and dropped. The pair closed the day with a loss of 0.42% at 7.3016.

The bulls regained control the following day and although the pair closed up on the day, it failed to break the prior days high. On 3rd November, the bulls tried to maintain control but failed and the pair closed with a loss of 0.14%. The downward move gained momentum on 4th November as the U.S. Dollar bears drove the pair lower and appetite for the Yuan increased. The USDCNH broke and closed below the midpoint of the Daily Bollinger Bands at 7.1718 with a loss of 2.15%.

The USDCNH ended the trading week with a loss of 1.33%.

The U.S. Dollar bulls returned on 7th November and the USDCNH rallied. Even though the pair met resistance when it reached the midpoint of the Daily Bollinger Bands the USDCNH closed up at 7.2245 with a gain of 0.74%.

The following two consecutive trading days the USDCNH moved higher but again the midpoint of the Daily Bollinger Bands brought an influx of sellers and the pair struggled to gain momentum.

The bears returned on 10th November and the USDCNH traded lower to close near the lower boundary of the Daily Bollinger Bands at 7.1494 with a loss of 1.67%.

This bearish momentum continued into trading on 11th November as the pair printed a lower close for the final trading day of the week with a loss of 0.83%, below the lower boundary of the Daily Bollinger Bands.

The USDCNH ended the trading week with a loss of 1.13% to close at 7.0904.

The bearish momentum continued the following week as the USDCNH closed the first day of trading at 7.0407 with a loss of 0.67% to test a daily area of support at 7.0257–6.9907. The area held and the pair took a small bounce upwards on 15th November. The bullish momentum gathered pace and the pair closed higher for the following two trading days as the pair gained 1.42% over this period.

The pair pulled back slightly on the final trading day as the bears returned and the pair lost 0.27% of its value to close at 7.1274.

The USDCNH closed the week with a gain of 0.55%.

The bulls came back on 21st November, the USDCNH rallied. The pair closed up 0.79% at 7.1760. The bears returned the following day and the pair dropped to close with a loss of 0.58% at 7.1345. Throughout the remainder of the trading week the pair edge slightly higher to eventually close above the midpoint of the Daily Bollinger Bands.

The USDCNH closed the week with an overall gain of 0.97% at 7.1890.

On Monday 28th November the demand for the U.S. Dollar continued and the bulls drove the pair higher to close at 7.2462 with a gain of 0.55%. The bullish move up reversed on 29th November when the bears regained control at an area of resistance 7.2409–7.2688 on a 4-hour timeframe. The pair dropped sharply back below the midpoint of the Daily Bollinger Bands to close at 7.1376 with a loss of 1.51%. The bearish momentum continued into the final trading day of the week as the pair lost a further 1.40% to close lower at 7.0427.

USDCNH is in a downtrend on a daily timeframe. On a weekly timeframe, the prevailing trend is up although weakness has occurred throughout November. The USDCNH closed the month at 7.0427, with a loss of 3.85% putting an end to the 8-month positive run. This was the strongest monthly performance the Yuan has made against the U.S. Dollar.

UPCOMING HIGH IMPACT EVENTS

• Fri 9 Dec CPI (Nov)
• Thr 15 Dec Retail Sales (Nov)
• Tue 20 Dec PBoC Interest Rate Decision
• Sat 31 Dec NBS–Manufacturing & Non–Manufacturing PMI (Dec)

Asia Tech –

The ICE Asia Tech 30 Index (ATI) ended the month higher for once after many months of weakness. Chinese component stocks made significant gains as did many in Taiwan.

• Chinese component stocks all gained with Bilibili, Inc. higher by 67.5% reversing the previous month’s fall, and Kuaishou Technology up by 52.2%. JD.com gained 39.1% in the month.
• Taiwan stock components rose led by Taiwan Semiconductor Manufacturing up 25.2%, and MediaTek Inc higher by 22.4%. United Microelectronics Corp. was up by 17.3% and Delta Electronics by 15.7%. Only Hon Hai Precision Industry closed lower by 1.0%.
• Japanese index components, the largest rise was seen in Tokyo Electron Ltd. up by 14.6% and Sony Group Corporation which rose 12.7%. Two companies increased by around 7% — Fujifilm Holdings and Fujitsu Limited.
• Korean component stocks were mixed with Samsung SDI down this month by 4.1%. Kakao rose by 11.2% and Naver Corp by 9.7%.

DAILY TREND: DOWN

ATI moved higher as the month progressed broadly following the overall equity markets and took a breather from consecutive months of lower closes.

ATI closed the month higher at $3,076 with a +22.1% change.

Index Composition: 37% China, 23% Japan, 23% Taiwan and 17% South Korea

UPCOMING HIGH IMPACT EVENTS

• Fri 9 Dec China CPI (Nov)
• Thr 15 Dec Retail Sales (Nov)
• Sat 31 Dec China Non-Manufacturing PMI (Dec)

Oil –

ICE Brent Crude traded lower during November towards the late-September low of $79.68 to set a higher-low, and bounced back toward $90.00 to end the month at $86.97. Concerns around demand for oil in China influenced price downward despite the 2 million barrel output supply cut announced in the prior month by Russia.

• OPEC+ will meet virtually on Sunday 4th December. Expectations are for current supply targets to be maintained. However, output cuts could remain on the table for discussion given concerns on the demand side of the equation. Going forward, observers will be assessing the impact of the European Union price cap on seaborne Russian oil, and China’s demand for oil in light of easing COVID-19 restrictions.
• The European Union’s embargo on Russian seaborne crude takes effect on Monday 5th December with the price cap set at $60 per barrel. Allowing the sale of Russian oil with the price cap will reduce the risk of oil flowing through blackmarkets and non-G7 nation channels. It is intended to put pressure on Russia’s economy to reduce their revenue that could be spend on the war, and move them closer to ending hostilities with Ukraine.

DAILY TREND: DOWN

ICE Brent Crude traded lower from the higher high set in the last part of October where it traded near $98.00.

Weaker expected demand pushed price lower, in particular from China which had kept strict Covid-19 restrictions in place impacting their economic outlook. Brent closed the month at $86.97 with a -4.3% change.

UPCOMING HIGH IMPACT EVENTS

• Sun 4 Dec OPEC+ policy meeting to decide on whether to decrease supply of oil or hold it steady as price continued to fall.

Key Figures –

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