Daily Markets

• Gold prices hovered above three-month lows on Wednesday, reeling from steep losses in the prior session as traders pivoted into the dollar ahead of more cues on U.S. interest rates. Federal Reserve Chair Jerome Powell is set to testify before Congress later in the day, potentially offering more cues on the path of monetary policy and interest rates after mixed signals from the Fed last week. Uncertainty over the Fed sparked some flows into the dollar, given that the central bank paused its rate hike cycle but signaled potentially more hikes later in the year. This had weighed on gold prices, keeping them largely within a tight trading range seen over the past month. Gold, precious metals under pressure ahead of Powell testimony. But despite falling for three straight days, gold prices were still trading within the $1,930 to $2,000 an ounce trading range seen since mid-May, amid a dearth of major catalysts for more movement. While concerns over rising interest rates have limited any major gains in the yellow metal, it has also remained underpinned by expectations for worsening economic conditions later in the year. Other precious metals moved in a similar band as gold, with platinum and silver futures falling slightly on Wednesday after steep losses in the prior session. Focus is now on Powell's testimony, which is potentially expected to provide more cues on how the Fed plans to treat interest rates amid worsening economic trends this year. Among industrial metals, copper prices rose slightly on Wednesday, extending mild gains from the prior session after major importer China cut its benchmark lending rates. Copper futures rose 0.2% to $3.8865 a pound, after adding 0.5% in the prior session. China cut its benchmark loan prime rate for the first time in 10 months, as the country struggles to release more stimulus and support a slowing economic rebound. Copper was buoyed by hopes that Chinese economic trends will improve amid more stimulus measures, which in turn will boost the country’s appetite for commodity imports. But broader sentiment over a Chinese economic recovery has also soured, with a slew of major investment banks cutting their outlook for full-year economic growth.

Gold – XAU

Gold on Wednesday made its intraday high of US$1956.68/oz and low of $1929.64/oz. Gold is down by 0.733% at US$1936.05/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 1,966-2000 keeping stop loss closing above 2000, targeting 1955-1944-1936 and 1926-1920-1910. Buy in between 1,944-1,900 with risk below 1,900 targeting 1966-1974 and 1981-1990-2000.

Silver - XAG

Silver on Wednesday made its intraday high of US$24.01/oz and low of US$23.04/oz settled down by 3.374% at US$23.13/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 22.90-18.30, 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 24.10-27.50 with a stop loss above 27.50; targeting 23.60-23.00 and 22.05-21.60-21.00.

Oil - WTI

Crude Ol on Wednesday made an intra‐day high of US$72.24/bbl, an intraday low of US$70.80/bbl, and settled down by 0.393% to close at US71.35/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 71.50-74.70 with stop loss at 75.00; targeting 70.10-69.00-68.40 and 67.50-66.80-65.60. Buy above 70.90-64.10 with risk daily closing below 64.00; targeting 71.40-72.30 and 73.50-74.10-75.00.

EUR/USD

EUR/USD on Wednesday made an intraday low of US$1.0906/EUR, a high of US$1.09454/EUR, and settled the day down by 0.166% to close at US$1.0917/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 1.0990-1.1390, targeting 1.0600-1.0550 and 1.0510-1.0470 with stop-loss at daily closing above 1.1390. Buy above 1.0900-1.0525 with risk below 1.0525 targeting 1.0970-1.1020-1.1090 and 1.1150-1.1210-1.1390.

GBP/USD

GBP/USD on Wednesday made an intra‐day low of US$1.2712/GBP, a high of US$1.2805/GBP, and settled the day up by 0.180% to close at US$1.2763/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 1.2750-1.2200 with a target of 1.2855-1.2910 and 1.2970-1.3050 with a stop loss closing below 1.2200. Sell in between 1.2800-1.3050 with targets at 1.2750-1.2690-1.2650 and 1.2520-1.2450 with stop loss should be 1.2954.

USD/JPY

USD/JPY on Wednesday made an intra‐day low of JPY141.20/USD, an intraday high of JPY142.24/USD, and settled the day down by 0.367% at JPY141.43/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 141.90-145.00 with risk above 145.00 targeting 141.00-139.70-138.90 and 137.90-137.00-136.20. Long positions above 141.00-136.00 with targets of 141.60-142.00-143.50 and 144.00-144.60-145.40 with stops below 136.00