Daily Market Lookup

• Asian shares stumbled on Friday and gold jumped amid rising doubts that a highly anticipated meeting between U.S. President Donald Trump and Chinese President Xi Jinping this weekend could lead to an easing of trade tensions. U.S. President Donald Trump arrives at the G20 leaders summit in Osaka, Japan, June 28, 2019. Uncertainty over whether the talks will produce progress in ending the year-long trade war between the world’s two largest economies comes amid signs of rising risks to global growth. Regardless of the outcome, McKenna said, “we will not be in a holding pattern on Monday morning.” White House economic adviser Larry Kudlow said on Thursday that Trump had agreed to no preconditions for the meeting, set to take place on Saturday at the G20 summit in Japan, and is maintaining his threat to impose new tariffs on Chinese goods. Kudlow also dismissed a Wall Street Journal report that China was insisting on lifting sanctions on Chinese telecom equipment giant Huawei Technologies Co Ltd [HWT.UL] as part of a trade deal and that the Trump administration had tentatively agreed to delay new tariffs on Chinese goods. On Thursday, China’s central bank pledged to support a slowing economy as global risks rise, ahead of the release of data that is expected to show China’s factory activity shrank for a second consecutive month in June. The losses followed gains in global equity markets overnight. U.S S&P 500 e-mini stock futures ESc1 wavered on Friday, trimming early gains to trade up just 0.05%. Seema Shah, global investment strategist at Principal Global Investors, said even if signs of progress emerge on trade, investors would quickly move on to U.S. interest rate policy.
• The dollar trod water early on Friday as investors awaited a crucial meeting between the leaders of the United States and China at a Group of 20 summit over the weekend for any signs of progress to end their heated trade war. The mood improved the previous day after the South China Morning Post said Washington and Beijing were laying out an agreement that would help avert the next round of tariffs on an additional $300 billion of Chinese imports. Negotiations between the world's two largest economies have been fraught, so traders and analysts caution that a resolution at the G20 summit is far from certain. Yet, markets seem to cling on to hopes of progress in a meeting between U.S. President Donald Trump and Chinese President Xi Jinping at the G20 in the western Japanese city of Osaka That was reflected in an easing of risk aversion as U.S. stocks gained and Treasury yields shifted lower. The United States and China have already imposed tariffs of up to 25% on hundreds of billions of dollars of each other's goods in a dispute about China's trade practices that has lasted nearly a year. The drawn out trade war has slowed global growth and pushed many central banks toward cutting interest rates to support their economies. Any sign the trade war will come to an end would be a significant boost for the global economic outlook. However, analysts say sentiment on the single currency remains weak due to speculation the European Central Bank will ease monetary policy. Any weakness in June inflation data for the euro zone, set for release later on Friday, would support the argument for monetary easing. In May, core inflation decelerated sharply. Investor sentiment improved somewhat after the South China Morning Post reported yesterday that China and the U.S. have agreed to a truce ahead of the meeting, while The Wall Street Journal reported that Chinese leader Xi Jinping is expected to present U.S. President Donald Trump with a list of demands, including lifting the ban on U.S. companies selling to Huawei. Meanwhile, CNBC reported U.S. Trade Representative Robert Lighthizer told Chinese Premier Liu He in a phone call that balance will not happen, citing various violations of intellectual property in the past. Trump is set to hold the much-anticipated trade talks with Xi at 11:30 AM ET on Saturday. Meanwhile, the U.S. dollar was also little changed as jobless claims came in higher than expected. Initial jobless claims rose 10,000 to a seasonally adjusted 227,000 for the week ending June 22, the Labor Department said. Economists were looking for a smaller rise to 220,000.
• Oil prices eased on Friday in a cautious market, as traders eyed a scheduled meeting between U.S. President Donald Trump and Chinese President Xi Jinping at the G20 summit and next week’s OPEC meeting. The leaders of the G20 countries meet on Friday and Saturday in Osaka, Japan, but the most anticipated meeting is between Trump and Xi on Saturday. A trade dispute between the world’s two biggest economies has weighed on oil prices, fanning fears that slowing economic growth could dent demand for the commodity. Trump said on Wednesday a trade deal with Chinese President Xi was possible this weekend but he is prepared to impose U.S. tariffs on most remaining Chinese imports should the two countries disagree. “Even if U.S.-China trade talks turn positive, we think OPEC will extend the current production cuts until the end of the year. However, deeper cuts look unlikely, given the rising supply issues,” ANZ said. The OPEC and some non-members including Russia, known as OPEC+, will hold meetings on July 1-2 in Vienna to decide whether to extend their supply cuts. OPEC+ members agreed to curb oil output by 1.2 million barrels per day from Jan.1 Russian President Vladimir Putin said in an interview with the Financial Times on Thursday that the OPEC-led supply cut helped stabilize oil markets and the future of the output deal was expected to be on the agenda at the G20 summit. Tensions between the United Sates and Iran have also been keeping markets on edge A week after U.S. President Donald Trump called off air strikes on Iran at the last minute, the prospect that Tehran could soon violate its nuclear commitments has created additional diplomatic urgency to find a way out of the crisis.

Gold – XAU

Gold on Thursday made its intraday high of US$1412.09/oz and low of US$1398.59/oz. Gold up by 0.053% at US$1409.78/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1303) and breakage below will call for 1296-1288. MACD is above zero line and histograms are decreasing trend and it will bring downward stance in the upcoming sessions. RSI is in overbought region and more upside 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: Buy on Dips

Based on the charts and explanations above; buy above 1425-1380 with risk below 1380, targeting 1433-1440-1450 and 1456-1465. Sell below 1433-1465 keeping stop loss closing above 1433, targeting 1425-1415-1405 and 1392-1380.

Silver - XAG

Silver on Thursday made its intraday high of US$15.28/oz and low of US$15.14/oz. Silver settled down by 0.137% at US$15.24/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (14.93), 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 negative crossover to show downside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 15.05-13.20 targeting 15.35-15.60-15.90 and 16.20-16.50; stop breakage below 13.20. Sell below 15.35-16.90 with stop loss above 16.90; targeting 15.35-15.05-14.60 and 14.30-13.90.

Oil - WTI

Crude Oil on Thursday made an intra‐day high of US$59.69/bbl, intraday low of US$58.63/bbl and settled up by 0.157% to close at US$59.25/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 59.50-62.50 with stop loss at 62.50; targeting 58.70-58.10-57.35 and 56.90-56.00-55.50. Buy above 56.60-55.00 with risk daily closing below 55.00 and targeting 59.50-60.20an d61.00-61.70-62.50.

EUR/USD

EUR/USD on Thursday made an intraday low of US$1.1347/EUR, high of US$1.1380/EUR and settled the day up by 0.008% to close at US$1.1368/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.1349), which become immediate resistance level, break above will target 1.1320-1.1280. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving positive crossovers to signal for bullish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider.

Trading Strategy: Neutral to Buy

Buy above 1.1350-1.1175 with risk below 1.1175, targeting 1.1390-1.1420-1.1450 and 1.1500-1.1550. Sell below 1.1390-1.1550 targeting 1.1350-1.1320 and 1.1280-1.1220 with stop-loss at daily closing above 1.1540.

GBP/USD

GBP/USD on Thursday made an intra‐day low of US$1.2660/GBP, high of US$1.2723/GBP and settled the day down by 0.116% to close at US$1.2668/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 200DMA (1.2960) 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 positive crossover to confirm bearish 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 1.2790-1.12950 with targets at 1.2760-1.2700-1.2650 and 1.2600-1.2500-1.2475 stop should be below 1.2870. Buy above 1.2650-1.2400 with targets 1.2700-1.2750-1.2790 and 1.2830-1.2870 with stop loss closing below 1.2400.

USD/JPY

USD/JPY on Thursday made intra‐day low of JPY107.64/USD and made an intraday high of JPY107.84/USD and settled the day down by 0.004% at JPY107.76/USD.

Technicals in Focus:

USD/JPY on Thursday made intra‐day low of JPY107.64/USD and made an intraday high of JPY107.84/USD and settled the day down by 0.004% at JPY107.76/USD.In daily charts, JPY is sustaining above 100DMA (110.64), 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 in oversold territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

In daily charts, JPY is sustaining above 100DMA (110.64), 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 in oversold territory and signaling to sell as it has given negative crossover to confirm bearish stance.