Daily Markets

• Most Asian currencies moved little on Thursday as mild consolidation in the dollar offered some relief, while the Japanese yen firmed as expectations of government intervention offset data indicating an economic recession. Regional currencies were still reeling from a hotter-than-expected U.S. inflation reading, which saw traders further scale back expectations of early interest rate cuts by the Federal Reserve. A slew of Fed officials also warned that sticky inflation will keep the bank from easing interest rates early. The dollar surged to three-month highs earlier this week, but fell slightly in overnight trade. The dollar index and dollar index futures both moved little in Asian trade, and remained within sight of their highest level since mid-November. But further losses in the yen were held back by a slew of Japanese officials warning that they were watching for any drastic moves in the yen, which could herald some currency market intervention. Levels above 150 yen have attracted government intervention in the past. Gross domestic product data showed Japan’s economy unexpectedly contracted in the fourth quarter, entering a technical recession as private spending weakened further. Weakness in the economy casts doubts over the Bank of Japan’s plans to begin raising interest rates in 2024. Analysts at ING said the trend was likely to delay the BOJ’s plans, and that they only expected a hike by June. Despite Thursday’s strength, the yen was still the worst-performing Asian currency this week amid growing concerns over higher-for-longer U.S. rates, which have been a key weight on the Japanese currency over the past two years. Broader Asian currencies moved in a flat-to-low range, but were nursing steep losses this week as U.S. rate concerns dented sentiment towards the region.

Gold – XAU

Gold on Wednesday made its intraday high of US$1996.04/oz and low of $1984.20/oz. Gold is down by 0.045% at US$1992.00oz.

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 2000-2061 keeping stop loss closing above 2061, targeting 1985-1974-1965 and 1955-1948. Buy in between 1985-1950 with risk below 1950 targeting 2000-2020-2039 and 2050-2058-2064.

Silver - XAG

Silver on Wednesday made its intraday high of US$22.41/oz and low of US$21.97/oz settle up by 1.135% at US$22.35/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 21.90-19.30, targeting 22.80-23.50-24.60 and 25.00-25.90 with stop loss should be placed on the breakage below 19.00. Sell in between 23.00-27.50 with a stop loss above 27.50 targeting 22.40-21.90 and 21.50-20.90-20.50.

Oil - WTI

Crude Oil on Tuesday made an intra‐day high of US$78.41/bbl, an intraday low of US$76.10/bbl, and settled down by 0.78% to close at US76.23/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 77.10-81.00 with stop loss at 77.50; targeting 76.50-75.75-74.40 and 73.70-72.90-72.00. Buy above 76.50-71.00 with risk daily closing below 71.00; targeting 77.30-78.00-79.00 and 79.90-80.80.

EUR/USD

EUR/USD on Wednesday made an intraday low of US$1.0694/EUR, a high of US$1.0733/EUR, and settled the day up by 0.167% to close at US$1.0725/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 1.0765-1.1100, targeting 1.0805-1.0775 and 1.0770-1.0640 with stop-loss at daily closing above 1.1100. Buy above 1.0690-1.0450 with risk below 1.0400 targeting 1.0765-1.0805-1.0890 and 1.1020-1.1105-1.1145.

GBP/USD

GBP/USD on Wednesday made an intra‐day low of US$1.2534/GBP, a high of US$1.2610/GBP, and settled the day down by 0.206% to close at US$1.2564/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 1.2540-1.2050 with a target of 1.2610-1.2670-1.2730 and 1.2790-1.2850-1.2890 with a stop loss closing below 1.2050. Sell in between 1.2610-1.2950 with targets at 1.2690-1.2630-1.2540 and 1.2490-1.2440-1.2390 with a stop loss of 1.2950.

USD/JPY

USD/JPY on Wednesday made an intra‐day low of JPY149.24/USD an intraday high of 150.77/USD, and settled the day down by 0.155% at JPY150.52/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 150.60-153.50 with risk above 153.90 targeting 149.90-149.30-148.90 and 146.95-146.50-145.80. Long positions above 149.10-140.90 with targets of 150.50-151.30-151.90 and 152.30-153.90 with stops below 140.00.