Daily Market Lookup

• The dollar was down on Monday morning in Asia, with optimism over a potential early rollout of COVID-19 vaccines offset by global economic restrictions to curb the spread of the virus. The FDA is looking to grant approval in mid-December for distribution of BNT162b2, the vaccine candidate produced by Pfizer Inc (NYSE:PFE) and German partner BioNTech (F:22UAy), chief scientific adviser for “Operation Warp Speed” Moncef Slaoui said. The first people in the U.S. could be inoculated a day after the approval. The U.K. could also grant regulatory approval to BNT162b2 this week. However, millions of Americans are expected to flout warnings to stay home for the upcoming Thanksgiving holiday, raising fears that the mass movement could increase the number of second wave cases in the country exponentially. Across the Atlantic, Germany, dealing with its own second wave, could see its current lockdown extended until mid-December. The lack of consensus in the U.S. Congress concerning a deal on the latest stimulus measures has also led to speculations that the Federal Reserve could ease monetary policy even further. The spat between the Fed and the Treasury Department over the termination of some emergency lending programs during the previous week also fed this speculation The minutes of the Fed’s last policy meeting, to be released on Wednesday, will now be scrutinized for confirmation that Fed policymakers discussed adding to the central bank’s asset-buying plans. Japanese markets are closed for a holiday, resulting in sparse liquidity and investor reluctance to test major chart barriers on several dollar pairs Meanwhile, the euro edged up against the dollar, but continues a struggle to break above the $1.993 resistance level that it also failed to breach during the previous week. However, some investors remain bullish on the single currency’s longer-term outlook.
• The dollar edged higher in early European trade Friday, in tight ranges as traders digest a potential rift between U.S. Treasury Secretary Steven Mnuchin and the Federal Reserve. The dollar has had a couple of competing influences overnight, resulting in traders taking a cautious stance. U.S. Treasury Secretary Steven Mnuchin called an end to some of the Federal Reserve's pandemic lending, as he asked for $455 billion allocated to the Treasury under the CARES Act to be re-appropriated for other spending. The central bank openly disagreed with the move. This was the first sign of a rift between these two essential bodies and sparked concern from some investors who had counted on central bank support, helping the safe-haven dollar. This move overturned the earlier weakness in the greenback after earlier reports that U.S. Senate Republican and Democrat leaders had agreed to resume negotiations on another coronavirus stimulus package. Weekly initial claims numbers had risen on Thursday for the first time in five weeks as the restrictions caused by the surge in Covid-19 cases halted the recovery in the employment market. California ordered a curfew placed on all indoor social gatherings and non-essential outside activities, while the country’s top public health agency pleaded with Americans not to travel for Thanksgiving. Elsewhere, GBP/USD rose 0.1% to 1.3270 after U.K. retail sales rose 1.2% in October, and were 5.8% higher than a year earlier, bucking forecasts for growth to slow to 4.2% as consumers started their Christmas shopping early. However, news about a potential trade deal between the U.K. and the European Union continues to be the main driver for sterling, meaning moves on economic data tend to be limited.
• Oil was up on Monday morning in Asia, after pushing up strongly over the weekend as hopes of a vaccine being rolled out before Christmas took hold and boosted hopes for a recovery in fuel demand. The U.S. has indicated that COVID-19 vaccinations could start as early as Dec 11. The news that a vaccination program could at last be in sight pushed oil to near-12-week gains over the weekend after Pfizer Inc (NYSE:PFE) and BioNTech (F:22UAy) applied for U.S. FDA emergency drug authorization for their COVID-19 vaccine on Friday. Moderna Inc (NASDAQ:MRNA). also announced on Friday that that it was also close to seeking the same approval after releasing promising data from its final-stage vaccine trial. Moncef Slaoui, head of the U.S. government’s Operation Warp Speed, announced the possible Dec. 11 start date on Sunday. Markets jumped on the positive news, despite the rocketing numbers of new COVID-19 infections and tightening public health restrictions across Europe and the U.S. Even with the advent of a viable vaccine, it will be quite some time before production and logistics are able to match the demand levels. In further positive developments, the Organization of Petroleum Exporting Countries and its allies (OPEC+) look likely to maintain their current supply cuts of 2 million barrels per day (bpd) past their current January expiration date. The group is said to be looking at delaying the reinstatement of supply for at least three months, and meets for its full ministerial meeting on Nov. 30 and Dec. 1. However, a group smaller Russian oil companies said on Friday that still plan to pump more crude this year despite the production cuts, as they have little leeway in managing the output of start-up fields.

Gold – XAU

Gold on Friday made its intraday high of US$1879.68/oz and low of US$1860.74/oz. Gold up 0.405% at US$1873.16/oz.

Technicals in Focus:

In daily charts, prices are below 50DMA (1899) and breakage above will call for 1916. MACD is above zero line and histograms are also increasing trend and it will bring upward 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 negative crossover to bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1860-1824 with risk below 1826, targeting 1874-1887-1900 and 1909-1916-1933. Sell below 1874-1933 keeping stop loss closing above 1933, targeting 1860-1848 and 1834-1824.

Silver - XAG

Silver on Friday made its intraday high of US$24.51/oz and low of US$23.89/oz settled up by 0.503% at US$24.16/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 20DMA (24.50), breakage above will lead to 25.00. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is approaching neutral 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 24.00-21.60 targeting 24.95-26.00 and 26.40-26.80-27.60, stop breakage below 21.50. Sell below 24.95-26.80 with stop loss above 26.80; targeting 24.00-23.20-22.60 and 22.00-21.60.

Oil - WTI

Crude Oil on Friday made an intra‐day high of US42.53/bbl, intraday low of US$41.60/bbl and settled up by 1.263% to close at US$42.38/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 40.52 which is a support level and breakage above will call for 42.00. MACD is above zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in neutral region and giving positive crossover for confirmation of bullish stance; while the RSI is in neutral region and more upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy above 42.50-39.00 with risk daily closing below 39.10 and targeting 43.00-43.90-44.50 and 45.00-45.80. Sell in between 43.00-45.80 with stop loss at 46.00; targeting 42.50-41.50-41.00-40.35 and 39.40-38.90-37.90.

EUR/USD

EUR/USD on Friday an intraday low of US$1.1849/EUR, high of US$1.1890/EUR and settled the day down by 0.077% to close at US$1.1862/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1031), which become immediate resistance level, break above will target 1.1090. 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 right now.

Trading Strategy: Neutral to Buy

Buy above 1.1860-1.1635 with risk below 1.1600, targeting 1.1900-1.1950 and 1.1970-1.2010. Sell below 1.1905-1.2010 targeting 1.1860-1.1790 and 1.1750-1.1710-1.1635 with stop-loss at daily closing above 1.2010.

GBP/USD

GBP/USD on Friday made an intra‐day low of US$1.3246/GBP, high of US$1.3296/GBP and settled the day up by 0.103% to close at US$1.3274/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.3134) is become immediate 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 bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.3340-1.3480 with targets at 1.3290-1.3200-1.3150 and 1.3100-1.3020-1.2965 stop-loss should be 1.3390. Buy above 1.3340-1.2880 with targets 1.3340- 1.3400-1.3450 and 1.3480-1.3550 with stop loss closing below 1.2800.

USD/JPY

USD/JPY on Friday made intra‐day low of JPY103.69/USD and made an intraday high of JPY103.90/USD and settled the day up by 0.114% at JPY103.84/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (108.30), 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 neutral territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 104.50-108.00 with risk above 108.00 targeting 103.90-103.10-102.50 and 102.00-101.50. Long positions above 103.10-101.00 with targets of 103.90-104.00-106.90 and 107.50-107.90-108.40 with stop below 105.00.