Daily Markets

• Most Asian currencies moved little on Tuesday, while the dollar steadied as markets awaited key U.S. inflation data for more cues on when the Federal Reserve could begin cutting interest rates. The Japanese yen was the worst performer among its regional peers, retreating sharply from an over one-month high after comments from top Bank of Japan officials somewhat cooled bets on an immediate rate hike from the central bank. The yen weakened about 0.3% against the dollar, retreating from an over one-month high hit on Monday. A reversal in the currency came largely after BOJ Governor Kazuo Ueda said that while the Japanese economy was recovering, it was also showing signs of weakness, particularly in consumption. He struck a somewhat less optimistic tone over the economy than markets were expecting. Ueda’s comments came just days before a BOJ meeting, where the central bank is widely expected to signal, or even enact an end to its yield curve control and negative interest rate regime. Stronger-than-expected producer inflation data, as well as an upward revision in fourth quarter GDP, had furthered this notion in recent sessions, given that economic resilience gives the BOJ more headroom to tighten policy. Broader Asian currencies moved in a flat-to-low range. The Australian dollar steadied near two-month highs, while the Indian rupee hovered near a six-month high. The Singapore dollar fell about 0.1%, while the South Korean won moved little. The Chinese yuan rose 0.1% following a stronger-than-expected midpoint fix by the People's Bank, although the outlook for the currency still remained glum in the face of a muted economic recovery. The dollar index and dollar index futures fell slightly in Asian trade on Tuesday, but steadied from steep losses last week. Focus was now squarely on upcoming U.S. consumer price index data, which is likely to factor into the Federal Reserve’s plans for interest rates in 2024. The CPI data is expected to show inflation remaining sticky and well above the Fed’s 2% annual target through February- a trend that is likely to elicit a hawkish outlook from the central bank. Tuesday’s CPI reading will also be in close focus after several Fed officials, most notably Chair Jerome Powell, warned that the central bank’s stance on interest rate cuts will be largely determined by the path of inflation.

Gold – XAU

Gold on Monday made its intraday high of US$2188.88/oz and low of $2174.72/oz. Gold is up by 0.157% at US$2182.47/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 2180-2220 keeping stop loss closing above 2220, targeting 2,172-2,160-2,140 and 2,129-2,120-2100. Buy in between 2160-2066 with risk below 2066 targeting 2180 and 2190-2200-2009.

Silver - XAG

Silver on Monday made its intraday high of US$24.50/oz and low of US$24.22/oz settle up by 0.431% at US$24.44/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 23.90-19.30, targeting 23.90-24.60 and 25.00-25.90 with stop loss should be placed on the breakage below 19.00. Sell in between 24.60-27.50 with a stop loss above 27.50 targeting 23.90- 23.20-22.40 and 21.90-21.50-20.90.

Oil - WTI

Crude Oil on Monday made an intra‐day high of US$78.09/bbl, an intraday low of US$76.48/bbl, and settled up by 0.607% to close at US77.83/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 78.00-83.30 with stop loss at 83.30; targeting 77.00-76.50 and 75.75-74.40-73.70. Buy above 77.00-71.00 with risk daily closing below 71.00; targeting 78.00-79.00 and 79.90-80.80.

EUR/USD

EUR/USD on Monday made an intraday low of US$1.0914/EUR, a high of US$1.0947/EUR, and settled the day down by 0.103% to close at US$1.0925/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 1.0940-1.1100, targeting 1.0805-1.0775 and 1.0770-1.0640 with stop-loss at daily closing above 1.1100. Buy above 1.0905-1.0450 with risk below 1.0400 targeting 1.0890 and 1.1020-1.1105-1.1145.

GBP/USD

GBP/USD on Monday made an intra‐day low of US$1.2794/GBP, a high of US$1.2860/GBP, and settled the day down by 0.3376% to close at US$1.2811/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.2674) 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 1.2790-1.2050 with a target of 1.2670-1.2730 and 1.2790-1.2850-1.2890 with a stop loss closing below 1.2050. Sell in between 1.2845-1.3120 with targets at 1.2790-1.2760-1.2690 and 1.2630-1.2540-1.2490 with a stop loss of 1.2950.

USD/JPY

USD/JPY on Friday made an intra‐day low of JPY146.47/USD an intraday high of 147.14/USD, and settled the day down by 0.0537% at JPY146.96/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 147.40-153.50 with risk above 153.90 targeting 148.10 and 146.95-146.50-145.80. Long positions above 146.60-140.90 with targets of 147.40-148.10-148.90 and 149.50-150.50-151.30 with stops below 140.00.