Daily Markets

• Oil prices fell in Asian trade on Tuesday, extending losses seen in the previous session, as weak economic data from China and expectations of a U.S. interest rate increase weigh on the market. China's manufacturing activity unexpectedly fell in April, official data showed on Sunday, the first contraction since December in the manufacturing purchasing managers' index. China's industrial and economic recovery from the coronavirus pandemic was expected to boost demand this year. Despite China's weak manufacturing data, there are positive signs of recovery based on spending during the five-day Labour Day holiday in the world's largest oil importer, said analysts in an ANZ Research note. Over the weekend, CCTV reported that passenger travel on the first day of the holiday surged 151.8% from the same day last year, while the number of air, road, waterway and railway trips rose to 56.99 million on the day. Meanwhile, a Monday poll showed that U.S. crude oil stockpiles are expected to have fallen for a third consecutive week, providing some support to the market. The poll was conducted ahead of reports from the American Petroleum Institute, an industry group, due at 4:30 p.m. EDT (2030 GMT) on Tuesday, and the Energy Information Administration, the statistical arm of the U.S. Department of Energy, due at 10:30 a.m. (1430 GMT) on Wednesday. However, the U.S. Federal Reserve, which meets on Tuesday and Wednesday, is expected to increase interest rates by another 25 basis points. Interest rate increases by inflation-fighting central banks could impact oil by slowing economic growth and denting energy demand. Banking fears have also weighed on oil in recent weeks and in what is the third major U.S. institution to fail in two months, U.S. regulators seized First Republic Bank (NYSE:FRC) over the weekend ahead of a deal in which JPMorgan (NYSE:JPM) bought most of its assets.

Gold – XAU

Gold on Monday made it’s intraday high of US$2003.24 /oz and low of $1974.13/oz. Gold is down by 0.0839% at US$1987.68/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 1990-2080 keeping stop loss closing above 2080, targeting 1981-1969-1950. Buy in between 1981-1959 with risk below 1959, targeting 2009-2,020-2,034 and 2,050-2,058-2,069-2,080.

Silver - XAG

Silver on Monday made its intraday high of US$25.90/oz and low of US$24.49/oz settled down by 0.672% at US$24.97/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 25.00-18.30, targeting 25.00-25.90-26.30 and 26.90-27.50 with stop loss should be placed on the breakage below 18.00. Sell in between 25.90-27.50 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$76.57/bbl, an intraday low of US$74.44/bbl, and settled dow by 1.13% to close at US$75.64/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 75.90-84.40 with stop loss at 84.40; targeting 74.10-73.50-72.40 and 71.50-70.80. Buy above 74.10-70.80 with risk daily closing below 70.80; targeting 75.00-76.05-76.70 and 77.30-78.00-79.60.

EUR/USD

EUR/USD on Monday made an intraday low of US$1.0963/EUR, a high of US$1.1035/EUR, and settled the day down by 0.470% to close at US$1.0971/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 1.0990-1.1250, targeting 1.0990-1.0960-1.0900 and 1.0810-1.0750-1.0700 with stop-loss at daily closing above 1.1032. Buy above 1.0950-1.0525 with risk below 1.0525 targeting 1.1030-1.1090-1.1150 and 1.1200-1.1250.

GBP/USD

GBP/USD on Monday made an intra‐day low of US$1.2385/GBP, a high of US$1.2506/GBP, and settled the day up 0.542% to close at US$1.2406/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 1.2445-1.2200 with a target of 1.2490-1.2545 and 1.2600-1.2640-1.2745 with a stop loss closing below 1.2200. Sell in between 1.2545-1.2745 with targets at 1.2450-1.2400-1.2340 and 1.2240-1.2200-1.2170 with stop loss should be 1.2745.

USD/JPY

USD/JPY on Monday made an intra‐day low of JPY136.09/USD and made an intraday high of JPY133.93/USD and settled the day down by 0.181% at JPY137.47/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 137.90-140.60 with risk above 140.60 targeting 137.00-136.20-134.90 and 134.00-132.90-132.20. Long positions above 137.00-130.00 with targets of 137.90-138.50-139.00 and 139.90-140.50 with stops below 130.00.