Daily Markets

• Oil fell by nearly 2% on Tuesday as concerns about the U.S. debt ceiling pact cooled the market's risk-on sentiment and mixed messages from major producers clouded the supply outlook ahead of their meeting this weekend. Some hard-right Republican lawmakers said on Monday they might oppose a deal that would raise the debt ceiling in the U.S., the world's biggest oil user, while Democratic President Joe Biden and Republican House of Representatives Speaker Kevin McCarthy remained optimistic the deal would pass. Biden and McCarthy forged an agreement over the weekend and it must pass a divided U.S. Congress before June 5, the day the Treasury Department says the country will not be able to meet its financial obligations, which could disrupt financial markets. The debt deadline nearly coincides with the June 4 meeting of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as OPEC+, and the uncertainty over whether they will increase their output cuts amid a recent slump in prices is also weighing on the market. Saudi Arabian Energy Minister Abdulaziz bin Salman last week warned short-sellers betting that oil prices will fall to "watch out" in a possible signal that OPEC+ may cut output. However, comments from Russian oil officials and sources, including Deputy Prime Minister Alexander Novak, indicate the world's third-largest oil producer is leaning toward leaving output unchanged. In April, Saudi Arabia and other members of OPEC+ announced further oil output cuts of around 1.2 million barrels per day (bpd), bringing the total volume of cuts by OPEC+ to 3.66 million bpd, according to Reuters calculations. Chinese manufacturing and service sector data out later this week will also be scrutinised for cues on the fuel demand recovery in the world's top oil importer.

Gold – XAU

Gold on Monday made it’s intraday high of US$1949.66/oz and low of $1940.15/oz. Gold is up by 0.0787% at US$1943.46/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 1,961-2080 keeping stop loss closing above 2009, targeting 1950-1939-1926 and 1920-1910-1900. Buy in between 1,941-1,900 with risk below 1,950 targeting 1966-1974-1981 and 1990-2000-2009.

Silver - XAG

Silver on Monday made its intraday high of US$23.36/oz and low of US$23.14/oz settled down by 0.446% at US$23.16/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 23.00-18.30, targeting 23.40-24.10-24.60 and 25.00-25.90-26.30 with stop loss should be placed on the breakage below 18.00. Sell in between 23.90-27.50 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$73.55/bbl, an intraday low of US$72.04/bbl, and settled down by 0.221% to close at US$72.95/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 72.50-79.75 with stop loss at 80.00; targeting 71.50-70.90-70.10 and 69.00-68.40-67.50. Buy above 73.10-68.40 with risk daily closing below 68.40; targeting 73.50-74.10-75.00 and 76.30-77.00-78.50.

EUR/USD

EUR/USD on Monday made an intraday low of US$1.0704/EUR, a high of US$1.0743/EUR, and settled the day up by 0.079% to close at US$1.0706/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 1.0750-1.1390, targeting 1.0700-1.0650-1.0600 with stop-loss at daily closing above 1.1032. Buy above 1.0710-1.0525 with risk below 1.0525 targeting 1.0810-1.1090-1.1150 and 1.1200-1.1250.

GBP/USD

GBP/USD on Monday made an intra‐day low of US$1.2330/GBP, a high of US$1.2371/GBP, and settled the day up 0.139% to close at US$1.2352/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 1.2320-1.2200 with a target of 1.2410-1.2500-1.2590 and 1.2640-1.2700-1.2745 with a stop loss closing below 1.2200. Sell in between 1.2410-1.2954 with targets at 1.2320-1.2290-1.2250 and 1.2205-1.2175 with stop loss should be 1.2954.

USD/JPY

USD/JPY on Monday made an intra‐day low of JPY140.10/USD, an intraday high of JPY140.91/USD, and settled the day down by 0.101% at JPY140.42/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 140.50-142.00 with risk above 142.00 targeting 139.70-138.90-138.50 and 137.90-137.00-136.20. Long positions above 139.70-136.00 with targets of 140.50-141.00-141.60 and 142.00-143.50-144.00 with stops below 133.00.