Daily Markets

• Most Asian currencies rose slightly on Friday, capitalizing on a drop in the dollar as markets hunkered down before key U.S. payrolls data that is likely to factor into interest rates. The dollar was also pressured by a rebound in the Japanese yen, which pulled further away from 34-year lows amid what appeared to be government intervention in currency markets. Weakness in the dollar offered some breathing room to regional currencies, although they were still nursing steep losses on the prospect of U.S. interest rates remaining high for longer. The USDJPY pair was set to lose about 3.4% this week as it tumbled from 34-year highs. Traders and analysts attributed the drop largely to currency market intervention by the Japanese government. The USDJPY pair had surged to 160 earlier this week. Traders said this level was the new line in the sand for currency market intervention. Domestic Japanese markets were closed on Friday. But the lower volumes also aided the yen. Still, the factors that had spurred recent yen weakness remained in play, chiefly the prospect of high-for-longer U.S. interest rates. Broader Asian currencies rose slightly, capitalizing on an overnight drop in the dollar. The Australian dollar’s AUDUSD pair rose 0.2%, as markets positioned for potentially hawkish signals from the Reserve Bank of Australia next week. Hotter-than-expected Australian inflation readings saw markets largely price out expectations of any rate cuts by the RBA in 2024, offering the Aussie some strength. Trading volumes in Asia remained muted on account of market holidays in Japan and China. The dollar index and dollar index futures steadied in Asian trade after tumbling in overnight trade, as pressure from the yen and expectations of no more interest rate hikes by the Federal Reserve dented the greenback. Focus was now squarely on nonfarm payrolls data for April, which is due later in the day. The reading has consistently beaten estimates for the past five months, with any signs of persistent labor market strength giving the Fed more headroom to keep rates high for longer. The Fed signaled earlier this week that it had no plans to cut rates in the near-term, especially in the face of sticky inflation.

Gold – XAU

Gold on Thursday made its intraday high of US$2326.33/oz and low of $2285.37/oz. Gold is down by 0.700% at US$2303.33/oz.

Technicals in Focus:

On the daily charts, gold trades higher than 20DMA (2197). If it drops below this level, it could lead to 2,100. The MACD is currently above the zero line and the histograms are showing an increasing trend, indicating that there may be upward movement in the coming sessions. The RSI is currently at 83.04, which is in the overbought region, suggesting there may be selling pressure in the next 2 to 3 sessions. The Stochastic Oscillator is also in the overbought territory but has given a positive crossover, indicating a bullish stance for intraday trades, but rebound in expected in all the overbought indicators.

Trading Strategy: Sell on Strength

Sell below 2329-2380 keeping stop loss closing above 2400, targeting 2300-2280-2267. Buy in between 2300-2254 with risk below 2250 targeting 2325 and 2340-2351-2360.

Silver - XAG

Silver on Wednesday made its intraday high of US$26.80/oz and low of US$25.99/oz settle up by 0.075% at US$26.65/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 20MA (25.05), breakage above will lead to 23.73. MACD is below the zero line and histograms are increasing trend, bringing a bullish stance in the upcoming sessions. RSI is in the oversold region, indicating a sell signal for now. The Stochastic Oscillator is in the overbought region and gives a positive crossover to show an upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 26.20-23.90, targeting 27.50-27.90-28.90 and 29.40-30.00-30.40-31.00 with stop loss should be placed on the breakage below 23.00. Sell in between 27.00-30.50 with a stop loss above 30.50 targeting 26.40-25.90 and 25.45-24.90 and 24.60-23.90-23.20.

Oil - WTI

Crude Oil on Thursday made an intra‐day high of US$79.58/bbl, an intraday low of US$80.67/bbl, and settled down by 0.01% to close at US78.80bbl.

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 80.00-89.65 with stop loss at 90.00; targeting 79.00-78.10-77.80 and 77.00-76.40. Buy above 79.00-75.00 with risk daily closing below 75.00, targeting 79.90-80.50-81.10 and 82.00-82.90-83.45.

EUR/USD

EUR/USD on Thursday made an intraday low of US$1.0673/EUR, a high of US$1.0756/EUR, and settled the day up by 0.134% to close at US$1.0724/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 1.0750-1.1100, targeting 1.0700-1.0640-with stop-loss at daily closing above 1.1100. Buy above 1.0690-1.0450 with risk below 1.0400 targeting 1.0845-1.0890 and 1.1020-1.1105-1.1145.

GBP/USD

GBP/USD on Thursday made an intra‐day low of US$1.2471/GBP, a high of US$1.2543/GBP, and settled the day up by 0.060% to close at US$1.2532/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 1.2430-1.2050 with a target of 1.2500-1.2540 and 1.2600-1.2690-1.2730 with a stop loss closing below 1.2050. Sell in between 1.2540-1.2700 with targets at 1.2360-1.2300-1.2240 and 1.2190-1.2100 with a stop loss of 1.2950.

USD/JPY

USD/JPY on Thursday made an intra‐day low of JPY153.05/USD an intraday high of 156.27/USD, and settled the day down by 0.611% at JPY153.55/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 153.10-159.00 with risk above 159.00 targeting 153.10-152.60-151.00 and 150.60-149.90-149.30. Long positions above 152.50-149.50 with targets of 153.10-154.40-154.90 and 156.10-156.90-157.50 with stops below 149.50.