Daily Markets

• Gold prices retreated from one-month highs on Monday, as traders locked in some profits after two weeks of gains, while copper prices fell tracking weak economic growth data from major importer China. Metal prices saw strong gains over the past two weeks as the dollar slumped to 15-month lows, tracking a string of weak U.S. inflation readings. The weak data also spurred increasing bets that the Federal Reserve was close to ending its rate hike cycle for the year. But gains in gold were also somewhat limited by signs of resilience in the U.S. economy, which in turn weighed on safe haven demand for the yellow metal. Prices have largely stalled after reaching the $1,960 an-ounce level last week. Among industrial metals, copper prices reversed some recent gains after data showed that economic growth in China, the world's largest copper importer, slowed substantially in the second quarter. China's second-quarter gross domestic product (GDP) barely grew from the first quarter, while also growing less than expected from the same period last year, government data showed on Monday. The country’s real estate sector - which is a key source of copper demand - is still struggling with weak sales and laggard activity, while manufacturing activity remained in contraction over the past three months. This spurred concerns over copper demand remaining steady this year, amid slowing growth in China. Among other readings, Chinese industrial production grew slightly more than expected in June, while retail sales growth slowed substantially. Still, trade data released last week showed that Chinese copper imports remained robust in June, although this was also attributed in part to manufacturers building inventory on weak spot copper prices. The Federal Reserve is widely expected to hike interest rates during a late-July meeting. But markets are now anticipating an extended pause in the Fed’s rate hike cycle, given the soft inflation readings from last week. Still, with core U.S. inflation remaining high, markets remained unsure over whether the central bank will signal a pause. Fed officials have also offered mixed cues on future rate hikes. The prospect of rising interest rates bodes poorly for metal markets, given that it increases the opportunity cost of holding non-yielding assets. But recent declines in the dollar have greatly benefited metal prices.

Gold – XAU

Gold on Monday made its intraday high of US$1959.73/oz and low of $1951.00/oz. Gold is down by 0.0046% at US$1954.68/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1894) and breakage below will call for 1871. MACD is below the zero line and histograms are also decreasing trend, which will bring more downward stances in the upcoming sessions. RSI is in the oversold region and more downside is expected before it gets stretched. The Stochastic Oscillator is in oversold territory and giving a negative crossover to a bearish stance for intraday trade.

Trading Strategy: Sell on Strength

Sell below 1966-2009 keeping stop loss closing above 2009, targeting 1954-1944-1934 and 1900-1894-1885. Buy in between 1954-1,871 with risk below 1874 targeting 1966-1974-1985 and 2000-2009.

Silver - XAG

Silver on Monday made its intraday high of US$24.92/oz and low of US$24.58/oz settled down by 0.337% at US$24.82/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (22.91), breakage above will lead to 23.51. 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 oversold region, indicating a sell 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 24.60-18.30, 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 25.00-27.50 with a stop loss above 27.50; targeting 24.60-24.10-23.40 and 22.05-21.60-21.00..

Oil - WTI

Crude Ol on Monday made an intra‐day high of US$75.98/bbl, an intraday low of US$73.76/bbl, and settled down by 1.16% to close at US74.04/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 68.50, 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, more upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Sell

Sell in between 75.20-79.60 with stop loss at 79.60; targeting 74.00-73.30-72.55 and 71.60-70.10-69.00. Buy above 74.00-69.50 with risk daily closing below 69.00; targeting 75.20-76.00-77.20 and 78.00-78.90-79.60.

EUR/USD

EUR/USD on Friday made an intraday low of US$1.1203/EUR, a high of US$1.1244/EUR, and settled the day up by 0.021% to close at US$1.1227/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 1.1250-1.1390, targeting 1.1020-1.0900-1.0840 and 1.0790-1.0750-1.0660 with stop-loss at daily closing above 1.1390. Buy above 1.1200-1.0705 with risk below 1.0725 targeting 1 and 1.1090-1.1150-1.1210.

GBP/USD

GBP/USD on Friday made an intra‐day low of US$1.3088/GBP, a high of US$1.3141/GBP, and settled the day down by 1.14% to close at US$1.3092/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 1.3050-1.2400 with a target of 1.3140-1.3200-1.3260 and 1.3320-1.3410 with a stop loss closing below 1.2400. Sell in between 1.2970-1.3140 with targets at 1.2910-1.2855-1.2800 and 1.2750-1.2650-1.2590 with a stop loss should be 1.3140.

USD/JPY

USD/JPY on Friday made an intra‐day low of JPY137.23/USD, an intraday high of JPY139.14/USD, and settled the day up by 0.566% at JPY138.80/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (137.57), 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 sell as it has given a negative crossover to confirm a bearish stance.

Trading Strategy: Neutral to Sell

Sell below 139.30-143.00 with risk above 143.00 targeting 138.30-137.50-136.90 and 136.40-135.50-134.90. Long positions above 138.30-134.90 with targets of 139.30-140.10-140.50 and 141.00-142.20-144.00 with stops below 134.00