Daily Markets

• The U.S. dollar held steady on Wednesday against a basket of peers as traders weighed the chances that the U.S. Federal Reserve would soon begin cutting interest rates. Fed officials have been pushing back after last week's Federal Open Market Committee meeting saw three rate cuts penciled in for 2024, sparking a rally in financial markets. Market participants are pricing in a 69% chance of the first cut happening at the Fed's March meeting, followed by a 63.3% probability of another in May, the CME FedWatch tool shows. On Tuesday, Raphael Bostic, president of the Atlanta Federal Reserve, reiterated that he expected two rate cuts in the second half of the year, but added there was no "urgency" now. The same day, Richmond Fed President Thomas Barkin said whether the central bank can deliver on forecasts of rate cuts depends on how the economy performs. The greenback's movement will depend on economic data supporting the rate cuts that have been priced in, said Rodda. The Fed's preferred measure of underlying inflation, the core Personal Consumption Expenditures (PCE) price index, is due this Friday, and could show whether inflation has slowed enough for the Fed to begin easing policy next year. The Japanese currency had been trading around the 142 range on Tuesday before the Bank of Japan said it had left monetary policy unchanged and its chief, Kazuo Ueda, gave no hints of an imminent end to negative interest rates The offshore Chinese yuan edged lower against the greenback to $7.1359 as China stood pat on benchmark lending loan prime rates (LPRs) at the monthly fixing, matching market expectations.

Gold – XAU

Gold on Tuesday made its intraday high of US$2046.89/oz and low of $2021.63/oz. Gold is up by 0.641% at US$2040.10/oz.

Technicals in Focus:

On the daily charts, gold trades higher than 20DMA (1953). If it drops below this level, it could lead to 1,927. The MACD is currently below the zero line but the histograms are showing an increasing trend, indicating that there may be upward movement in the coming sessions. The RSI is currently at 45.31, which is in the neutral region, suggesting there may be more selling pressure before it rebounds. The Stochastic Oscillator is also in the oversold territory but has given a positive crossover, indicating a bullish stance for intraday trades.

Trading Strategy: Sell on Strength

Sell in between 2044-2094 keeping stop loss closing above 2094, targeting 2032-2020-2005 and 1989-1980-1963. Buy in between 2032-1951 with risk below 1951 targeting 2049-2060-2074 and 2080-2094.

Silver - XAG

Silver on Tuesday made its intraday high of US$24.15/oz and low of US$23.74/oz settled up by 1.14% at US$24.03/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, bringing 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 23.40-19.30, targeting 23.50-24.60 and 25.00-25.90 with stop loss should be placed on the breakage below 19.00. Sell in between 24.00-27.50 with a stop loss above 27.50 targeting 23.40-22.40-21.90 and 21.50-20.90-20.50.

Oil - WTI

Crude Oil on Tuesday made an intra‐day high of US$74.45/bbl, an intraday low of US$72.15/bbl, and settled up by 1.80% to close at US74.20/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 73.90-76.70 with stop loss at 77.00; targeting 73.85-72.50-72.00 and 71.00-70.10-69.40. Buy above 72.00-67.35 with risk daily closing below 67.00; targeting 72.90-73.85-74.20 and 75.10-75.90-76.50.

EUR/USD

EUR/USD on Tuesday made an intraday low of US$1.0891/EUR, a high of US$1.0930/EUR, and settled the day up by 0.235% to close at US$1.0922/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 1.1020-1.1100, targeting 1.0940-1.0890-1.0820 and 1.0775-1.0770-1.0640 with stop-loss at daily closing above 1.1100. Buy above 1.0940-1.0490 with risk below 1.0490 targeting 1.0940 and 1.0990-1.1020-1.1060.

GBP/USD

GBP/USD on Tuesday made an intra‐day low of US$1.2632/GBP, a high of US$1.2761/GBP, and settled the day up by 0.685% to close at US$1.2729/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.2297) is becoming a resistance 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 1.2630-1.2050 with a target of 1.2730-1.2790-1.2850 and 1.2890-1.2950 with a stop loss closing below 1.2100. Sell in between 1.2700-1.2950 with targets at 1.2630-1.2540-1.2490 and 1.2440-1.2390-1.2300 with a stop loss of 1.2950.

USD/JPY

USD/JPY on Tuesday made an intra‐day low of JPY142.24/USD, an intraday high of JPY144.95/USD, and settled the day up by 0.769% at JPY143.81/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (137.57), 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 144.00-145.90 with risk above 146.00 targeting 143.00-141.60-140.90 and 140.00-138.70-137.90. Long positions above 142.90-137.90 with targets of 142.30-143.20-144.00 and 145.00-146.00-146.80 with stops below 137.90.