Daily Market Lookup

• Asian shares struggled for traction on Monday after U.S. employment data raised doubts about the strength of the global economy, while investor jitters ahead of crucial Brexit votes in the UK parliament this week weighed on the pound. The U.S. economy created only 20,000 jobs in February, the weakest reading since September 2017. As a result, bond yields dropped, with the 10-year Treasuries yield hitting a two-month low of 2.607 percent. It last stood at 2.638 percent. While job growth was weak, average hourly earnings rose 11 cents, or 0.4 percent, raising the annual increase to 3.4 percent, the biggest gain since April 2009. Retail sales figures for January’s due at 1230 GMT is a key focus given its December reading was surprisingly weak. Fed Chair Jerome Powell said on Friday that the central bank will be careful not to shock financial markets as it stabilizes its bond portfolio, saying that it does not see problems in the U.S. economy that warrant an immediate change in its policy. He also said the new normal for the Fed’s total liabilities may be in the ballpark of 16.5 percent of GDP. Many market players now expect the Fed to unveil a plan to end its balance sheet runoff as early as next week. Chinese data released over the weekend was slightly weaker though hopes for more policy support are likely to cushion any blows. Following the data, China’s central bank on Sunday pledged to further support the slowing economy by spurring loans and lowering borrowing costs.
• The British Pound fell on Monday in Asia on nervousness over Brexit, while the U.S. dollar edged up as traders look ahead to a fresh batch of U.S. economic data this week. The British parliament is set to vote on a revised Brexit deal on Tuesday. If the revised deal is rejected, lawmakers may vote on Thursday to delay Britain’s exit from the European Union (EU) ahead of the March 29 deadline. The U.K. Telegraph earlier reported that the EU could demand a multi-billion Pound increase in divorcee payment if the British parliament delays the deadline. Friday after U.S. jobs report and Chinese trade data both missed expectations, raising concerns of a slowdown in global economic activity. Looking ahead, markets will get the latest reading on U.S. retail sales later today. Data on U.S. consumer and producer prices are set to be released on Tuesday and Wednesday, respectively. Inflation figures will also be closely watched after the Federal Reserve vowed to be “patient” and await incoming data before raising interest rates again. The Bank of Japan is set to announce its benchmark interest rate and publish a rate statement on Friday. No changes to the current stimulus package are expected, according to analysts. Over the weekend, Chinese officials avoided any mention of a one-sided pledge by Beijing to hold its currency stable. Although Governor of the People’s Bank of China Yi Gang said China and the U.S. have reached consensus on many “crucial” issues. Meanwhile, U.S. Federal Reserve Chairman Jerome Powell’s comments received some attention as he said the central bank is not in a rush to change interest rates levels again, and that current rates are at an appropriate level "The financial crisis did a great deal of damage to many people's lives. And, of course, not all of them will be made whole," Powell said. But "our system is vastly more resilient and strong than it was before the financial crisis." Looking ahead, markets will get the latest reading on U.S. retail sales later in the day, which are expected to show another decline in January after an unexpected drop at the end of 2018. Data on U.S. consumer and producer prices are set to be released on Tuesday and Wednesday, respectively.
• Oil prices gained on Monday in Asia following reports that Saudi Arabia oil minister Khalid al-Falih said there will be no OPEC+ output policy change until June. Al-Falih told Reuters on Sunday it would be too early to change OPEC+ output policy at the group's meeting in April. The Organization of the Petroleum Exporting Countries (OPEC), which together with some non-affiliated producers like Russia, known as 'OPEC+', agreed late last year to reduce output by 1.2 million bpd to prop up prices. Oil futures settled lower on Friday, as weaker-than-expected Chinese trade and U.S. jobs data raised worries about global energy demand. The U.S. and China are the world’s two largest oil-consuming nations. After ending 2018 in freefall, oil prices have rallied more than 20% to start the year thanks to ongoing efforts by major producers to drain oversupply from the market. Looking ahead, market players will likely focus on monthly reports from the OPEC and the International Energy Agency (IEA) this week to assess global oil supply and demand levels. Elsewhere, the American Petroleum Institute (API) is set to publish its weekly update on U.S. oil supplies on Tuesday, while the U.S. Energy Information Administration (EIA) will release its weekly report on oil stockpiles on Wednesday.

Gold – XAU

Gold on Friday made its intraday high of US$1300.68/oz and low of US$1285.14/oz. Gold up by 1.009% at US$1298.20/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1266) and breakage below will call for 1254-1247. MACD is above zero line and histograms are decreasing trend and it will bring downward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; sell below 1300-1334 keeping stop loss closing above 1334, targeting 1294-1282-1276 and 1267-1260. Buy above 1294-1260 with risk below 1260, targeting 1300-1309 and 1316-1323-1334.

Silver - XAG

Silver on Friday made its intraday high of US$15.35/oz and low of US$14.99/oz. Silver settled up by 2.09% at US$15.31/oz.

Technicals in Focus:

On daily charts, silver is sustaining below200DMA (15.15), breakage above will lead to 15.60. 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 oversold region and giving positive crossover to show upside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 15.00-14.00 targeting 15.40-15.90-16.40 and 17.00-17.40; stop breakage below 14.00. Sell below 15.40-17.00 with stop loss above 17.00; targeting 15.10-14.85-14.50 and 14.00.

Oil - WTI

Crude Oil on Friday made an intra‐day high of US$56.73/bbl, intraday low of US$54.76/bbl and settled down by 0.681% to close at US$56.24/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 55.88 which is a resistance level and breakage above will call for 59.60. MACD is above zero line and histograms are in decreasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in oversold 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 57.00-59.60 with stop loss at 59.60; targeting 56.50-56.00-55.50 and 55.10-54.80. Buy above 56.00-54.30 with risk daily closing below 54.30 and targeting 57.50-58.00 and 59.00-59.60.

EUR/USD

EUR/USD on Friday made an intraday low of US$1.1184/EUR, high of US$1.1245/EUR and settled the day up by 0.357% to close at US$1.1232/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1405), which become immediate resistance level, break above will target 1.1560-1.1600. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in oversold territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider.

Trading Strategy: Neutral to Buy

Buy above 1.1210-1.1020 with risk below 1.1020, targeting 1.1270-1.1305 and 1.1380-1.1420-1.1460. Sell below 1.1270-1.1380 targeting 1.1210-1.1170-1.1090 and 1.1065-1.1020 with stop-loss at daily closing above 1.1380.

GBP/USD

GBP/USD on Friday made an intra‐day low of US$1.988/GBP, high of US$1.3107/GBP and settled the day down by 0.489% to close at US$1.3015/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2812) 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 oversold territory and giving negative crossover to confirm bullish stance. MACD is above zero line but histograms are increasing lead to downward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.3010-1.3250 with targets at 1.2950-1.2900-1.2850 and 1.2770-1.2730. Buy above 1.2950-1.2730 with targets 1.3010-1.3075-1.3120 and 1.3170-1.3200 with stop loss closing below 1.2730.

USD/JPY

USD/JPY on Friday made intra‐day low of JPY110.77/USD and made an intraday high of JPY111.64/USD and settled the day down by 0.354% at JPY111.16/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (110.03), which is initial 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 111.90-113.50 with risk above 113.50 targeting 111.60-111.00-110.20 and 109.90-109.50. Long positions above 111.60-109.00 with targets of 111.90-112.25-112.90 and 113.50-114.00 with stop below 108.50.