Daily Markets

• The dollar fell on Thursday after revised data showed that gross domestic product, the broadest measure of economic activity, grew at slower pace than previously expected in the first quarter. The Commerce Department reported the U.S. economy grew at an 1.3% annualized rate from January through March, down from the advance estimate of 1.6% after downward revisions to consumer spending. The downgrade of first-quarter growth followed recent softness in readings of retail sales and equipment spending, which had contributed to easing bets on Federal Reserve interest rate cuts. A two-day, 15-basis point jump above 4.6% for long-term Treasury yields had helped push the dollar to a two-week high on Wednesday by boosting the attractiveness of U.S. debt. The index tracking the U.S. currency against its major peers climbed to 105.18 overnight, the highest since May 14, but was last down 0.37% at 104.74. The release of the Personal Consumption Expenditures price index - the Fed's preferred measure of inflation - on Friday could provide further indications on how the central bank might proceed with interest rate cuts later this year. That readout could "move the needle a little bit more than today's GDP data," said Eugene Epstein, head of structuring for North America at Moneycorp. Expectations for Fed interest rate reductions this year have been pared back amid signs of sticky inflation, most recently with a surprise uptick in consumer sentiment in data on Tuesday. Market players suspect Japan intervened to prop up its currency at the end of April and early May, which may be confirmed by data out on Friday. Price data for the euro zone is due on Friday, following a stronger-than-expected April inflation reading for Germany on Wednesday.

Gold – XAU

Gold on Thursday made its intraday high of US$2351.68/oz and low of $2322.51/oz. Gold is up by 0.214% at US$2342.78/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 2350-2400 keeping stop loss closing above 2400, targeting 2320-2309-2300 and 2290-2277. Buy in between 2331-2277 with risk below 2277 targeting 2360 and 2382-2394-2405.

Silver - XAG

Silver on Thursday made its intraday high of US$32.07/oz and low of US$30.99/oz settle down by 2.44% at US$31.14/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 30.40-28.90, targeting 31.10-31.90-32.40 and 33.00-33.70-34.90 with stop loss should be placed on the breakage below 23.00. Sell in between 31.10-35.00 with a stop loss above 35.50 targeting 30.40-29.80-28.90 and 28.40-27.90-27.10.

Oil - WTI

Crude Oil on Thursday made an intra‐day high of US$79.17/bbl, an intraday low of US$77.45/bbl, and settled down by 1.75% to close at US$77.67/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 80.40-89.65 with stop loss at 90.00; targeting 77.50 and 77.00-76.40-75.50. Buy above 78.20-75.00 with risk daily closing below 75.00, targeting 79.20-79.90 and 80.50-81.10-82.00.

EUR/USD

EUR/USD on Thursday made an intraday low of US$1.0787/EUR, a high of US$1.07877/EUR, and settled the day up by 0.283% to close at US$1.0830/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 1.0890-1.1100, targeting 1.0700-1.0640-with stop-loss at daily closing above 1.1100. Buy above 1.0800-1.0450 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$1.2680/GBP, a high of US$1.2746/GBP, and settled the day up by 0.488% to close at US$1.2730/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 1.2700-1.2050 with a target of 1.2760-1.2830-1.2890 and 1.2950-1.2990 with a stop loss closing below 1.2050. Sell in between 1.2760-1.2900 with targets at 1.2700-1.2670-1.2610-and 1.2500-1.2450-1.2360 with a stop loss of 1.2950.

USD/JPY

USD/JPY on Friday made an intra‐day low of JPY156.36/USD an intraday high of 157.66/USD, and settled the day down by 0.525% at JPY156.77/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 157.00-159.00 with risk above 159.00 targeting 156.00-155.50-154.30 and 153.60-153.10-152.60. Long positions above 156.50-149.50 with targets of 156.90-157.50 and 158.00-158.60 with stops below 149.50.