Daily Market Lookup

• Asian shares plunged on Thursday as hundreds of billions of dollars hemorrhaged from global markets after a rout in tech stocks inflicted the largest daily decline on Wall Street since 2011, wiping out all its gains for the year. Stock investors have become increasingly nervous about lofty equities valuations, a likely peak in corporate earnings momentum, faster rate hikes in the United States and an ongoing Sino-U.S. trade war that threatens to hurt world growth. Some analysts feel equity bears may be better off focusing outside the United States, at least for now. Weak readings on manufacturing in Europe have added to angst over world growth, as has a surprise slump in U.S. home sales, which suggested rising mortgage rates were sapping demand for housing. Adding to the air of tension, police intercepted suspected bombs mailed to former U.S. President Barack Obama, Hillary Clinton and other high-profile Democrats, as well as to CNN, in what New York officials branded an act of terrorism.
• The Japanese yen rose against the dollar on Thursday as a rout on Wall Street and weak European and U.S. economic data dented global risk sentiment, sending investors scurrying to safe-haven assets including government bonds. Over the past week, nervousness around U.S. corporate earnings and geopolitical uncertainty added to heightened worries about global growth, Italy's free spending budget and Sino-U.S. trade tensions. Also dampening sentiment were September's two-year low in sales of new U.S. single-family homes, the latest sign that rising mortgage rates and higher prices were hurting demand for housing. Euro zone business growth slowed more than expected this month, a widely watched PMI survey showed on Wednesday. German private-sector growth fell to its lowest in more than three years, and manufacturing in France hit a 25-month low, according to other surveys. The European Central Bank (ECB) holds its monetary policy meeting later on Thursday, and investors will be looking for any new guidance acknowledging the recent slowdown in growth as well as the political stand-off between Brussels and Rome over Italy's free spending budget. British Prime Minister Theresa May's Brexit plans have stoked uncertainty over recent weeks, especially on the terms of Britain's exit from the EU. But May received a show of support from her Conservative Party on Wednesday at a meeting in parliament, shifting the focus away from talk of an imminent leadership challenge over her Brexit strategy.
• U.S. factories have raised their prices because of tariffs, although inflation has appeared modest or moderate in most parts of the country, the Federal Reserve said on Wednesday in its latest report on the economy. The U.S. central bank also said in its latest “Beige Book” report that the economy appeared to be growing modestly to moderately and that businesses across a number of industries had reported labor shortages. The report, a snapshot of the economy gleaned from discussions with business contacts in the Fed’s 12 districts between September and mid-October, detailed business worries about the Trump administration’s trade war with China and simmering tensions with other major trading partners. Still, the Fed signaled that inflation pressures did not appear very high. “Prices continued to rise, growing at a modest-to-moderate pace in all districts.” The Fed has raised interest rates three times this year in a bid to keep prices from rising too quickly. It is widely expected to lift them again in December. President Donald Trump has slapped tariffs on imports from a range of trading partners, including China, the European Union, Canada and Mexico, prompting retaliation against U.S. exports. Among manufacturers in the Dallas Fed’s district, which is largely centered on Texas, the Fed said: “Roughly 60 percent of contacts said the tariffs announced and/or implemented this year have resulted in increased input costs.” In the Chicago Fed’s Midwestern region, “retail contacts across numerous sectors indicated that they expected consumers to see the impact of U.S. tariffs on imports by early 2019,” according to the Fed’s report.
• Oil prices fell by around one percent on Thursday, coming under pressure from sharp selloffs in global stock markets, with U.S. stocks posting the biggest daily decline since 2011 to wipe out the year's gains. Markets have been hit hard this month by a range of worries, including the Sino-U.S. trade war, a rout in emerging market currencies, rising borrowing costs and bond yields, as well as economic concerns in Italy Bowing to pressure from Washington, China's oil-majors Sinopec and China National Petroleum Corp (CNPC) have not ordered any oil from Iran for November because of concerns that violating sanctions could impact their global operations. China is Iran's biggest oil customer. Halting oil Iranian imports means its many refiners will have to seek alternative supplies elsewhere. Some relief could come from the United States, where crude production and storage levels are high. U.S. commercial crude oil stockpiles rose for a fifth consecutive week last week, increasing by 6.3 million barrels to 422.79 million barrels, the Energy Information Administration said on Wednesday. Output remained unchanged at 10.9 million barrels per day (bpd), slightly below a record 11.2 million bpd reached at the start of October.

Gold – XAU

Gold on Wednesday made its intraday high of US$1233.83/oz and low of US$1225.52/oz. Gold up by 0.295% at US$1233.73/oz.

Technicals in Focus:

In daily charts, prices are below 100DMA (1228) and breakage above will call for 1240-1260. MACD is below zero line and histograms are decreasing trend and it will bring upward stance in the upcoming sessions. RSI is in oversold region and more downside is expected before it gets stretched. Stochastic Oscillator is in overbought territory and giving positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Sell on Strength

Based on the charts and explanations above; sell below 1238-1254 keeping stop loss closing above 1254, targeting 1230-1221-1214 and 1207-1200. Buy above 1230-1194 with risk below 1194, targeting 1238-1244 and 1250-1256.

Silver - XAG

Silver on Wednesday made its intraday high of US$14.78/oz and low of US$14.63/oz. Silver settled down by 0.339% at US$14.67/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (15.45), breakage above will lead to16.05-16.30. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in oversold region, indicating buy signal for now. The Stochastic Oscillator is in neutral region and giving positive crossover to show upside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 14.35-12.40 targeting 14.90-15.10 and 15.60-16.35; stop breakage below 12.40. Sell below 14.90-17.00 with stop loss above 17.00; targeting 14.40-13.90 and 13.50-13.00.

Oil - WTI

Crude Oil on Wednesday made an intra‐day high of US$67.73/bbl, intraday low of US$66.06/bbl and settled up by 0.287% to close at US$66.37/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 50DMA i.e. 69.62 which is a support level and breakage above will call for 62.20-62.80. MACD is above zero line and histograms are in increasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving negative crossover for confirmation of bearish stance; while the RSI is in oversold region and more downside can be expected.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 67.10-69.60 with stop loss at 69.60; targeting 66.10-65.70 and 65.10-64.50. Buy above 66.10-64.50 with risk daily closing below 64.50 and targeting 67.10-67.70-68.10 and 69.00-69.60.

EUR/USD

EUR/USD on Wednesday made an intraday low of US$1.1475/EUR, high of US$1.1475/EUR and settled the day down by 0.668% to close at US$1.1390/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1621), which become immediate resistance level, break below will target 1.1690-1.1730. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently approaching oversold region and giving wards directions to consider sell.

Trading Strategy: Neutral to Buy

Buy above 1.1430-1.1290 with risk below 1.1290, targeting 1.1430-1.1490-1.1540 and 1.1610-1.1690. Sell below 1.1430-1.1690 targeting 1.1380-1.1340-1.1300 and 1.2960-1.2900 with stop-loss at daily closing above 1.1750.

GBP/USD

GBP/USD on Wednesday made an intra‐day low of US$1.2866/GBP, high of US$1.2989/GBP and settled the day down by 0.785% to close at US$1.2878/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.3096) is become major support level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in neutral territory and giving positive crossover to confirm bullish stance. MACD is above zero line but histograms are increasing lead to downward movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; sell below 1.2900-1.3100 with targets at 1.2870-1.2840-1.2790 and 1.2750-1.2700. Buy above 1.2840-1.2700 with targets 1.2900-1.2950-1.3000 and 1.3060-1.3100 with stop loss closing below 1.2870.

USD/JPY

USD/JPY on Wednesday made intra‐day low of JPY111.94/USD and made an intraday high of JPY112.73/USD and settled the day down by 0.115% at JPY112.23/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (111.82), which is major support on the daily chart. 14-D RSI is currently in overbought region and chances of downward are expected based on RSI. MACD is above zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is approaching overbought territory and signaling to buy as it has given positive crossover to confirm bullish stance.

Trading Strategy: Neutral to Sell

Sell below 112.50-115.50 with risk above 115.50 targeting 112.00-111.50 and 111.20-110.70. Long positions above 112.00-110.70 with targets of 112.50-113.00-114.00 and 114.70-115.50 with stop below 111.00.