By Samir Al Khoury,
The Korean KOSPI index recorded 2,896 points yesterday, marking its highest level since 18 January 2022. This index has risen approximately 27% from its low of 2,273 points on 31 October last year to yesterday’s close at 2,886 points. It has also increased by 10% from the beginning of the year until yesterday’s session close.
Recent Korean economic data shows the resilience of the Korean economy:
-
The Manufacturing Purchasing Managers’ Index rose in July, registering 52.0 points, up from 51.6, its highest level since April 2022.
-
The trade balance index rose in June to $8 billion, surpassing expectations of 5.24 billion and the previous reading of 4.86 billion.
-
The industrial production index increased by 3.5% year-on-year in May, exceeding expectations of 3.1%.
Additionally, the Consumer Price Index (CPI) in South Korea declined to 2.4% in June, lower than both expectations and the previous reading of 2.7%. This figure is closer to the South Korean Central Bank’s target rate of 2%, potentially encouraging the central bank to consider reducing interest rates in the near future. Korean interest rates have remained fixed at 3.50% since January 2023.
From a technical standpoint, the outlook for the Korean KOSPI index is encouraging, with the major challenge being to reach and surpass the psychological level of 3,000 points. The Relative Strength Index (RSI) recorded approximately 71 points, indicating that it is in the overbought zone and reflecting positive momentum for the KOSPI index.
The positive movement index (DMI+) is approximately 40 points, compared to the negative movement index (DMI-), which stands at around 12 points. This significant gap suggests strong buying pressure on Korean stocks. More importantly, the ADX trend strength indicator records about 27 points, which is above the 25-point threshold, indicating that the momentum of this upward trend is strong.
Please note that this analysis is provided for informational purposes only and should not be considered as investment advice.
Taurex is the trading name of Zenfinex Global Limited, Stochastic Africa SL Ltd, Zenfinex Global LLC, and Zenfinex Limited.
Zenfinex Global Limited is registered in the Republic of Seychelles with registration number: 8428731-1 and is regulated by the Financial Services Authority of Seychelles (license number SD092). Its registered office address is F20, 1st Floor, Eden Plaza, Eden Island, Seychelles.
Stochastic Africa (SL) Limited is a company registered in Sierra Leone with Company Number: SL270319STOCH05271 and is licensed by the Bank of Sierra Leone under license number BSL/SAL/2023 and with the registered office at 148D Wilkinson Road, Freetown, Sierra Leone.
Zenfinex Global LLC is a company registered with the Financial Services Authority in Saint Vincent and the Grenadines under registered number 138 LLC 2019. Its registered office is Hinds Building, Kingstown, Saint Vincent, and the Grenadines.
Zenfinex Limited is a company registered in England and Wales under registered number: 11077380. Authorised and regulated by the Financial Conduct Authority under firm reference number 816055. Its registered office is 4th Floor, 4 Eastcheap, London, EC3M 1AE, United Kingdom.
*All trading involves risk.
