Daily Markets

• The dollar headed toward a second week of gains on Friday, after a slight rate hike in Japan gave the yen a slight reprieve and a surprise cut in Switzerland highlighted the gap in interest rate policy between the Federal Reserve and other central banks The week marked a shift in global monetary policy as the Swiss National Bank (SNB) and central banks in developing countries cut rates or indicated their intention to do so, with June the likely moment for the European Central Bank to move. The dollar rose against all G-10 currencies except the yen, as the relatively strong U.S. economy and high interest rates kept the carry trade alive. But the Swiss rate cut, the first by a major central bank in Europe, marked a definitive shift. The Fed left its overnight rate on hold between 5.25%-5.5% and stuck with projections for three cuts by year's end. But it also said it would not cut until it was confident that inflation was sustainably declining toward its 2% target. About 84 basis points of cuts are priced in for this year - much lower than the 160 or so at the start of the year - but higher than earlier in the week as rate cut bets gained steam. Sterling dropped 0.5%, hitting a one-month low at 1.258, after a 1% drop on Thursday when the Bank of England left rates unchanged. But the BoE revealed a more dovish tilt as two hawkish committee members dropped their prior call for a hike. The Swiss franc, the best performing G10 currency of 2023, has lost about 1.7% in value against the dollar this week and about 6.8% so far this year. Euro/yen hit its highest since 2008 this week at 165.37 and the Aussie broke above 100 yen for the first time since 2014. The Bank of Japan announced an historic shift out of negative short-term rates and longer-run yield caps, but it was so well telegraphed that the yen fell on the news. Expectations for policy easing in China too have piled pressure on its currency, which dropped sharply in the onshore session, spooking equity investors and prompting state banks to step in. Bitcoin was set for its largest weekly drop since last August, with a roughly 6.7% fall, as crypto markets have taken a step back from a powerful rally this week - though it will trade through until Sunday.

Gold – XAU

Gold on Friday made its intraday high of US$2185.96/oz and low of $2157.05/oz. Gold is down by 0.732% at US$2165.20/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 2190-2250 keeping stop loss closing above 2250, targeting 2170-2154 and 2,140- 2,129-2,120 Buy in between 2170-2120 with risk below 2066 targeting 2190-2209-2,225-2,230 and 2,239-2,250.

Silver - XAG

Silver on Friday made its intraday high of US$24.92/oz and low of US$24.38/oz settle down by 0.186% at US$24.68/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 Friday made an intra‐day high of US$81.33/bbl, an intraday low of US$80.29/bbl, and settled down by 0.408% to close at US80.66/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 81.10-85.30 with stop loss at 85.30; targeting 79.90-79.00 and 78.00-77.30-76.50. Buy above 79.90-75.00 with risk daily closing below 75.00; targeting 80.80-81.50-82.00 and 82.70-83.35-84.00.

EUR/USD

EUR/USD on Friday made an intraday low of US$1.0801/EUR, a high of US$1.0867/EUR, and settled the day up by 0.547% to close at US$1.0807/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 Friday made an intra‐day low of US$1.2574/GBP, a high of US$1.2674/GBP, and settled the day down by 0.438% to close at US$1.2600/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 1.2600-1.2050 with a target of 1.2690-1.2730 and 1.2790-1.2850-1.2890 with a stop loss closing below 1.2050. Sell in between 1.2700-1.3120 with targets at 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 JPY150.99/USD an intraday high of 151.85/USD, and settled the day down by 0.0857% at JPY151.42/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 151.20-154.00 with risk above 154.00 targeting 151.00-150.60-149.90-149.30 and 148.10-147.40-146.95. Long positions above 151.00-141.90 with targets of 151.30-51.90 and 152.50-153.10-154.00 with stops below 141.90.