Daily Markets

• The dollar weakened and the yen rebounded from near multi-decade lows on Wednesday after the Federal Reserve held interest rates steady as expected and policymakers still projected three U.S. rate cuts this year even as inflation remains elevated. The Fed's updated quarterly economic projections showed the personal consumption expenditures price index excluding food and energy rising at a 2.6% rate by year-end, compared to 2.4% in the projections the U.S. central bank issued in December. The new policy view also raised the outlook for the U.S. economy. Policymakers now see growth at 2.1% this year compared to 1.4% projected in December, while the unemployment rate is seen ending 2024 at 4%, versus 4.1% anticipated late last year. ed Chair Jerome Powell said that even with unexpected strength in recent consumer price data, his outlook is that inflation is moving down gradually on a somewhat bumpy road. Wizman said that the message that came out of the Fed's summary of economic projections is one of a stronger U.S. economy, both in the short and the long term. Earlier the yen had slumped to 151.82, a fresh four-month low against the dollar just hours before the Fed concluded a two-day policy meeting that came after the Bank of Japan (BOJ) on Tuesday raised interest rates for the first time in 17 years. Analysts said the yield differential between U.S. Treasuries and Japanese government bonds remained wide and would keep pressure on the yen as it trades near a multi-decade low of 151.94 to the dollar hit in October 2022. But the major central banks are largely moving in lockstep as they plan to cut interest rates to spur growth as economies slow and inflation keeps decelerating. Low Japanese rates have made the yen the funding currency of choice for carry trades, in which traders typically borrow a low-yielding currency to then sell and invest the proceeds in assets denominated in a higher-yielding one. Recent stronger-than-expected U.S. inflation reports have led traders to further reduce bets on Fed rate cuts this year, with markets now pricing in 81 basis points (bps) of easing by year end, or almost half expectations at the start of 2024. European Central Bank President Christine Lagarde said earlier on Wednesday that the ECB will continue to be data dependent and will not commit to a pre-set number of rate cuts even after it starts easing its monetary policy.

Gold – XAU

Gold on Wednesday made its intraday high of US$2188.71/oz and low of $2149.50/oz. Gold is by 1.121% at US$2186.03/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 2210-2250 keeping stop loss closing above 2250, targeting 2200-2188-2180 and 2,140- 2,129-2,120 Buy in between 2200-2120 with risk below 2066 targeting 2209-2,225-2,230 and 2,239-2,250.

Silver - XAG

Silver on Wednesday made its intraday high of US$25.62/oz and low of US$24.72/oz settle up by 0% at US$25.55/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 24.60-19.30, targeting 25.00-25.45-25.90 and 26.50-26.90-27.50 with stop loss should be placed on the breakage below 19.00. Sell in between 25.35-27.50 with a stop loss above 27.50 targeting 24.90-24.60-23.90 and 23.20-22.40-21.50.

Oil - WTI

Crude Oil on Wednesday made an intra‐day high of US$82.54/bbl, an intraday low of US$80.75/bbl, and settled down by 1.322% to close at US81.33/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 82.00-85.30 with stop loss at 85.30; targeting 81.50-81.10-79.00 and 78.00-77.30-76.50. Buy above 81.50-75.00 with risk daily closing below 75.00; targeting 82.00-82.70-83.35 and 84.00-84.70-85.90.

EUR/USD

EUR/USD on Wednesday made an intraday low of US$1.0835/EUR, a high of US$1.0922/EUR, and settled the day up by 0.510% to close at US$1.0920/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 1.0905-1.1100, targeting 1.0805-1.0775 and 1.0770-1.0640 with stop-loss at daily closing above 1.1100. Buy above 1.0805-1.0450 with risk below 1.0400 targeting 1.0890 and 1.1020-1.1105-1.1145.

GBP/USD

GBP/USD on Tuesday made an intra‐day low of US$1.2667/GBP, a high of US$1.2732/GBP, and settled the day down by 0.0526% to close at US$1.2720/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 1.2760-1.2050 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 1.2800-1.3120 with targets at 1.2760-1.2690 and 1.2630-1.2540-1.2490 with a stop loss of 1.2950.

USD/JPY

USD/JPY on Wednesday made an intra‐day low of JPY142.17/USD an intraday high of 142.68/USD, and settled the day up by 0.135% at JPY142.38/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 151.30-154.00 with risk above 154.00 targeting 151.00-150.60-149.90-149.30 and 148.10-147.40-146.95. Long positions above 150.60-141.90 with targets of 151.30-51.90 and 152.50-153.10-154.00 with stops below 141.90.