Daily Markets

• Most Asian currencies moved in a tight range on Thursday as markets looked to upcoming U.S.-China trade talks for more cues, while strength in the dollar also weighed after the Federal Reserve kept interest rates steady. Regional markets took few positive cues from U.S. President Donald Trump stating that he will announce a “major” trade deal on Thursday, after a report suggested that the deal will be with Britain. Overnight strength in the dollar presented a weak lead-in for most Asian currencies, after the Fed kept rates steady and flagged no plans to lower rates in the near-term. Regional sentiment was also quashed by heightened military tensions between India and Pakistan, as the two nuclear armed countries engaged in their worst fighting in years. The dollar index and dollar index futures fell marginally in Asian trade after logging strong overnight gains on the Fed. The central bank signaled no hurry to cut interest rates, amid heightened uncertainty over trade, the economy, and inflation. Fed Chair Jerome Powell also reiterated the bank’s wait-and-see approach towards rates. Sentiment towards the U.S. was little improved by Trump stating that he will announce a major trade deal later on Thursday, after a report said the deal will be with the UK. The UK is not subject to Trump’s plans for steep reciprocal tariffs, given that it has a trade deficit with Washington. While a U.S.-UK trade deal still stands to benefit both countries, its economic ramifications are likely to be far less pronounced than a trade deal with other, larger economies- especially Japan, the European Union, and China. The Chinese yuan weakened slightly on Thursday, with the USDCNY pair rising 0.1%. The currency had taken limited support from Washington and Beijing confirming that officials will meet for trade talks in Switzerland this week. Markets see a U.S.-China trade deal as unlikely in the near-term, especially as Beijing reiterated that no major negotiations will take place until the U.S. lowers its steep trade tariffs on the country. Trump said he had no plans to do so ahead of talks this week. Other Asian currencies were muted amid little optimism over trade and economic growth.

Gold – XAU

Gold on Wednesday its intraday high of US$3437.77/oz and low of $3360.01/oz. Gold is down by 1.856% at US$3364.15/oz.

Technicals in Focus:

On the daily charts, gold trades higher than 20DMA (2197). If it drops below this level, it could lead to 2,100. The MACD is currently above the zero line and the histograms are showing an increasing trend, indicating that there may be upward movement in the coming sessions. The RSI is currently at 83.04, which is in the overbought region, suggesting there may be selling pressure in the next 2 to 3 sessions. The Stochastic Oscillator is also in the overbought territory but has given a positive crossover, indicating a bullish stance for intraday trades, but rebound in expected in all the overbought indicators.

Trading Strategy: Sell on Strength

Sell below 3385-3461 keeping stop loss closing above 3461, targeting 3370-3358-3345 and 3320-3300-3260-3245. Buy in between 3365-3208 with risk below 3200 targeting 3390-3405-3420 and 3430-3438-3470.

Silver - XAG

Silver on Wednesday its intraday high of US$33.22/oz and low of US$33.22/oz settle down by down by 2.36% at US$32.43/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 20MA (25.05), breakage above will lead to 23.73. MACD is below the zero line and histograms are increasing trend, bringing a bullish stance in the upcoming sessions. RSI is in the oversold region, indicating a sell signal for now. The Stochastic Oscillator is in the overbought region and gives a positive crossover to show an upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 32.50-27.10, targeting 33.50-33.90-34.30 and 34.60-35.00 with stop loss should be placed on the breakage below 27.00. Sell in between 33.10-34.00 with a stop loss above 34.00 targeting 32.50-31.90-30.90 and 30.50-29.90-29.20.

Oil - WTI

Crude Oil on Wednesday high of US$59.88/bbl, an intraday low of US$57.35/bbl, and settled down by 1.77% to close at US$57.64/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 75.37, a support level, and breakage above will call for 77.48. 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 overbought region, giving a negative crossover to confirm a bearish stance; while the RSI is in the neutral region, more upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Sell

Sell in between 59.60-62.00 with stop loss at 62.00; targeting 59.255.50-54.75-54.00 and 53.50-52.90. Buy above 59.20-52.00 with risk daily closing below 52.00, targeting 59.80-60.25-61.00 and 61.50-62.20-63.00.

EUR/USD

EUR/USD on Wednesday an intraday low of US$1.1291/EUR, a high of US$1.1377/EUR, and settled the day down by 0.634% to close at US$1.1295/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.0800), which becomes immediate support, a break below will target 1.0717. MACD is above the zero line and histograms are increasing mode, bringing a bullish view. Stochastic is in oversold territory, giving negative 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 1.1370-1.1740, targeting 1.1340-1.1300-1.1250-1.1200 with stop-loss at daily closing above 1.1035. Buy above 1.1300-1.1010 with risk below 1.1010 targeting 1.1450-1.1520-1.1550-1.1590 and 1.1630-1.1690-1.1740.

GBP/USD

GBP/USD on Wednesday low of US$1.3279/GBP, a high of US$1.3379/GBP, and settled the day down 0.544% to close at US$1.3290/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2674) is becoming a support level. 14-D RSI is currently in a neutral region and direction is difficult to predict on an RSI basis. The Stochastic Oscillator is in oversold territory and gives a positive crossover to confirm a bullish 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 1.3360-1.3040 with a target of 1.3400-1.3435-1.3470 and 1.3510-1.3550-1.3600 with a stop loss closing below 1.3040. Sell in between 1.3390-1.3600 with targets at 1.3300-1.3266 and 1.3206-1.3150-1.3110 with a stop loss of 1.3140.

USD/JPY

USD/JPY on Wednesday an intra‐day low of JPY142.34/USD an intraday high of 143.98/USD, and settled the day up by 1.016% at JPY143.79/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (155.35), 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 decreasing mode which might lead to downward movement. The Stochastic Oscillator is in overbought territory and signaling to sell as it has given a negative crossover to confirm a bearish stance.

Trading Strategy: Neutral to Sell

Sell below 143.90-149.00 with risk above 149.00 targeting 144.00-143.40-142.50-141.90 and 140.60-140.00-139.60. Long positions above 143.00-138.00 with targets of 143.90-144.50-145.20 and 146.00-146.60-147.40 with stops below 138.00.