Something interesting is going on in Uganda. This past week the World Bank suspended lending to the government of Uganda citing accountability and lack of transparency – calling it few good words like inefficiency.
Many Ugandans were shocked to read the suspension by WB of the funding. Had they been following the news or what yours truly has kept sharing, they would have known that in 2015 WB cut off some funding and it was only a pre-cursor.
When it comes to the Uganda shilling, there are few factors in play. First of all the growth was downgraded by IMF and WB to 5.8% where the country was expectiving 7%+ of growth.
The shilling has gone from 2500 on the US dollar to now 3372. These numbers mean nothing to the average person but they hurt when you buy imported. You will remember that last week I wrote about Buy Made in Uganda.
As much as I want this shilling to tank to 4000 on the US dollar and then fall with gravity, it is holding up pretty good but I have made some good money from its fall of 2500 to 3350 on the US dollar. Bite!
The Uganda shilling closed at 3372 on the US dollar, 4398 on the British pound, 3769 on the Euro, 50.35 on the Rupee, 33.32 on the Kenyan shilling, 2554 on the Canadian dollar, 2543 on the Australian dollar nd 1.55 on the Tanzania shilling. Impressive for how tough it is holding up but the chart points to it going down in flames. 7
Coffee Arabica closed at $3.63 per kilo.
Coffee Robusta closed at $2.13 per kilo.
What I am liking about coffee is the narrow range in which it is moving. Winter is nearly upon Europe and North America and the coffee sales will go up. The only advice (as usual) is that exporters need to mix both types. As a matter of fact, not too many coffee shops now sell authentic. Coffee houses BLEND. So your Arabica will get blended with Robusta and other types (which I do not know) end up with label. “Made in Starbucks roasting house”. If you choose to export only one type of bean, you lose out on the fluctuations in the market where the cheaper beans or more expensive beans could make you some money. Just saying….
Gold is trading at $1314 and only gained $0.25 per ounce. This is great news. It means the markets are going to recover.
Brent Crude Oil closed at $45.90 after hammering in the fall and signaling that it is going to try and reverse upwards. The closing level is inconsequential but we will have to keep an eye on the number of rigs being re-opened in in Canada and USA. Unfortunately I only get those numbers on Friday but in reality North Americ is ramping up production so when people talk about OPEC, I roll my eyes back.
WTI Crude Oil closed at $43.86 per barrel and formed the same pattern as Brent. Oil is turning up. If you can spare some money, go long in it. This is certainly not the time to short it. However, even if you go long, remember that the trend is down so you will need to watch oil diligently or simply, just stay on the sidelines.
Shanghai fell and then rose up and then closed with zero change. Seriously? But anyhow, it is still in bear territory for having bridged support.
Hong Kong rose 4 points but it is a none player. We might have to stop following it because Shanghai and Tokyo do the trick. Hong Kong is going to be replaced by Australia.
Tokyo gained 114 points but is still in bear territory. The Nikkei does not move smoothly and it is one index that I would never consider trading because of its erratic movements. Lately, it makes tiny moves but when it makes a big move, instead of what we are looking at in the 100+ neighbourhood, you can wake up and this thing has moved 1500 points. I call the NIKKEI the widow or widower maker. Heart attacks are made of it.
Frankfurt gained 98 points but still has room to go down.
Paris gained 62 points and closed above one of its support levels (200 moving average) so it is looking good.
London gained 103 points and cracked through its resistance (the last one) and is gonna fly. Too bad for all the weak hands who shed the FTSE. Was #Brexit really worth the panic selling? Who is the last one laughing now?
Toronto gained 45 points and is trying to recover. It has some 3 levels of resistance waiting so we might want to keep an eye on this one. I would not necessarily take out any positions now but I would hold back before going in or adding short or long.
Dow Jones Industrial Average lost 4 points and it is trying to recover but one thing about the INDU is the fact that it is closing daily in a red big long negative candle and although it has support, this one could shake us out. If I were holding, I would take half the money off the table. If I were to buy, I would check with my broker in daytime after the first 2hours of trading and dip in only one foot at a time and gently too. The Dow is very bearish at the moment and yet not definitely bullish so hold your money.
Standard and Poor had no change.
NASDAQ lost 10 points but still remains bullish. The COMPQ has been resilient and doing rather well. The only thing is if the S&P, Dow, TSX are lagging behind, the NAS will eventually follow the tide. What a beautiful short setup though.
The world is still at war and bombs, etc. It gets a bit depressing to cover world news but check us out. http://www.theinsider.ug/category/world-news/
You can also follow me on Social Media throughout the day as my accounts keep sending out updates all the time.
Martha Leah Nangalama
I have an IT and Business background. All my opinions are mine and mine alone.