Daily Markets

• Oil prices rose on Tuesday, recovering a measure of steep losses from the prior session, although caution ahead of upcoming U.S. inflation data and the conclusion of a Federal Reserve meeting kept markets on edge. Crude markets were nursing their worst loss in nearly two weeks as concerns over sluggish demand, worsening economic conditions and a potential boost in Iran-driven supply largely countered the prospect of tighter production after a Saudi cut last week. Prices saw little scope for recovery as traders remained cautious ahead of key U.S. inflation data and a Fed meeting, due on Tuesday and Wednesday, respectively Focus was now squarely on U.S. consumer price index inflation data, due later in the day, which is in turn expected to factor into a Fed interest rate decision on Wednesday. While markets widely expect the Fed to pause its rate hike cycle, recent strength in the labor market and signs of relatively high inflation kept traders wary of any hawkish surprises from the central bank. Rising interest rates pressure economic activity, which in turn dents oil and fuel demand. Crude markets were sold off heavily this year on that notion. Even if the Fed pauses its rate hike cycle, U.S. rates are expected to remain higher for longer this year, pressuring activity. Strength in the dollar, amid high U.S. rates, is also expected to weigh on crude markets. Fears of worsening demand kept traders cautious over buying into crude, following a string of weak economic readings from major economies in the past few months. Concerns over China have weighed heavily on oil prices in recent months, as investors questioned whether a post-COVID economic rebound was running out of steam. Weak economic prints from the U.S., coupled with signs of a recession in the eurozone also brewed more concerns over demand this year. On the other hand, the potential of a U.S.-Iran nuclear deal also kept traders cautious over increased supply, especially as Iran’s supreme leader signaled some openness to reaching an agreement. Oil prices ticked up on Tuesday on apparent bargain hunting, recovering some ground from the previous day's plunge. But gains were limited as investors remained cautious ahead of key policy decisions by central banks and on weak economic data from China. Most market participants expect the Fed to leave interest rates unchanged. The Fed's rate hikes have strengthened the greenback, making dollar-denominated commodities more expensive for holders of other currencies weighing on oil prices. The European Central Bank is expected to hike interest rates by another quarter percentage point on Thursday while the Bank of Japan is expected to maintain its ultra-loose policy on Friday. In China, disappointing economic data last week raised concerns about demand growth in the world's largest crude importer. Its central bank lowered a short-term lending rate on Tuesday to restore market confidence. Demand jitters offset a temporary boost in oil prices from Saudi Arabia's pledge to cut more production in July. Oil demand outlooks from the OPEC due on Tuesday and the IEA due on Wednesday will provide further trading cues.

Gold – XAU

Gold on Tuesday made its intraday high of US$1966.89/oz and low of $1949.10/oz. Gold is down by 0.140% at US$1957.28/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1809) and breakage below will call for 1790. MACD is above the zero line and histograms are a2lso increasing trend and it will bring an upward stance in the upcoming sessions. RSI is in the overbought region and more upside is expected before it gets stretched. The Stochastic Oscillator is in neutral territory and giving a negative crossover to a bearish stance for intraday trade.

Trading Strategy: Sell on Strength

Sell below 1,966-2080 keeping stop loss closing above 2009, targeting 1955-1944-1936 and 1926-1920-1910. Buy in between 1,955-1,900 with risk below 1,900 targeting 1966-1974 and 1981-1990-2000.

Silver - XAG

Silver on Tuesday made its intraday high of US$24.29/oz and low of US$23.86/oz settled down by 0.751% at US$24.04/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (21.00), breakage above will lead to 21.60. MACD is below the zero line and histograms are decreasing trend and it will bring a bearish stance in the upcoming sessions. RSI is approaching the neutral region, indicating a buy signal for now. The Stochastic Oscillator is in the oversold region and gives a positive crossover to show an upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 24.10-18.30, targeting 24.10-24.60 and 25.00-25.90-26.30 with stop loss should be placed on the breakage below 18.00. Sell in between 24.60-27.50 with a stop loss above 27.50; targeting 25.00-24.60-23.60-23.00 and 22.05-21.60-21.00.

Oil - WTI

Crude Ol on Monday made an intra‐day high of US$70.53/bbl, an intraday low of US$66.92/bbl, and settled down by 4.00% to close at US67.42/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 68.50 which is a support level and breakage below will call for 68.40. MACD is above the zero line and histograms are in increasing mode will bring a bullish stance in the upcoming sessions. The Stochastic Oscillator is in the neutral region, giving a positive crossover for confirmation of a bullish stance; while the RSI is in the neutral region and more upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Sell

Sell in between 68.40-72.30 with stop loss at 73.00; targeting 67.50-66.80-65.60 and 65.00-64.10 Buy above 67.40-64.10 with risk daily closing below 64.00; targeting 70.10-71.00-72.30 and 73.50-74.10-75.00.

EUR/USD

EUR/USD on Monday made an intraday low of US$1.0732/EUR, a high of US$1.0721/EUR, and settled the day down by 0.097% to close at US$1.0712/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0736), which becomes immediate support, a break below will target 1.0647. MACD is above the zero line and histograms are increasing mode which will bring a bullish view. Stochastic is in overbought territory and giving positive crossovers to the bullish outlook for intraday. 14D RSI is currently in a neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Sell

Sell below 1.0790-1.1390, targeting 1.0600-1.0550 and 1.0510-1.0470 with stop-loss at daily closing above 1.1032. Buy above 1.0750-1.0525 with risk below 1.0525 targeting 1.0790-1.0840 and 1.1090-1.1150-1.1200

GBP/USD

GBP/USD on Monday made an intra‐day low of US$1.2486/GBP, a high of US$1.2598/GBP, and settled the day down by 0.401% to close at US$1.2509/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.2112) is becoming a resistance level. 14-D RSI is currently in a neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and gives a positive crossover to confirm bullish a stance. MACD is above the zero line but histograms are increasing leading to movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy in between 1.2520-1.2200 with a target of 1.2590 and 1.2640-1.2700-1.2745 with a stop loss closing below 1.2200. Sell in between 1.2590-1.2954 with targets at 1.2450-1.2390-1.2320 and 1.2290-1.2250-1.2205 with stop loss should be 1.2954.

USD/JPY

USD/JPY on Monday made an intra‐day low of JPY139.05/USD, an intraday high of JPY139.76/USD, and settled the day up by 0.508% at JPY139.57/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (134.05), which is major support on the daily chart. 14-D RSI is currently in the overbought region and chances of downward are expected based on RSI. MACD is above the zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is in overbought territory and signaling to buy as it has given a positive crossover to confirm a bullish stance.

Trading Strategy: Neutral to Sell

Sell below 139.70-142.00 with risk above 142.00 targeting 139.70-138.90-138.50 and 137.90-137.00-136.20. Long positions above 139.00-136.00 with targets of 139.60-140.50-141.00 and 141.60-142.00-143.50 with stops below 133.00.