Daily Market Lookup

• The dollar was up on Monday morning in Asia, with the euro falling to a fresh 22-month low against the dollar and hitting multi-year lows on the yen, Swiss franc, and the pound. The ongoing conflict in Ukraine drove up commodity prices and stoked fears of a stagflationary shock that would hit Europe the hardest.
• The euro was down as much as 0.6% to $1.0864 earlier in the session, the lowest since May 2020, and was on the way to its 2020 low around $1.0636. It also fell below one Swiss franc, hitting 0.9982 for the first time since the franc quit its euro peg in 2015. The conflict in Ukraine intensified over the weekend, with attempts at a ceasefire to allow civilians to evacuate from the city of Mariupol having seemingly failed so far. The euro fell to a 15-month low of 124.78 yen and hit its lowest since mid-2016 against the pound at 82.23 pence. Meanwhile, the European Central Bank will hand down its policy decision later in the week, with the central bank expected to wait until the last months of 2022 to hike its interest rates, according to a Reuters poll. The U.S. will also release its consumer price index later in the week.
• The euro briefly sank below parity versus the Swiss franc for the first time in seven years on Monday and held at a 22-month low versus the dollar as soaring oil prices stoked fears of a stagflationary shock that could hammer Europe. The conflict in Ukraine and harsh international sanctions on Moscow have sent Russian assets tumbling while prices of the country's exports such as precious metals, oil and gas have soared at a time when the global economy was already grappling with inflationary pressures. Europe is the most vulnerable as it imports as much as 40% of its natural gas consumption from Russia and the single currency has become increasingly correlated with oil prices -- the higher oil climbs, the more the euro falls as investors fret about higher inflation and the blow to the economy.
• Gold climbed to its highest in one-and-half years on Monday and palladium hit an all-time high on safe-haven asset appeal, while nickel soared over 20% on fears of supply disruptions tied to sanctions on Russia and continued fighting in Ukraine. Gold prices rose above $2,000 per ounce, palladium hit a record, LME 3-month nickel posted its largest ever one-day gain, and oil and wheat jumped to 14-year highs as Russia's escalating invasion of Ukraine continued to roil global commodities. The searing rally in raw material prices has sparked concerns over economic growth in countries still recovering from the COVID-19 pandemic. Stagflation refers to countries that are experiencing a simultaneous increase in inflation and stalled economic output. Fighting stopped about 200,000 people from evacuating the besieged Ukrainian city of Mariupol for a second day in a row on Sunday, as Russian President Vladimir Putin vowed to press ahead with his invasion unless Kyiv surrendered. Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust (P:GLD), rose 0.4% to 1,054.3 tonnes on Friday - their highest since mid-March 2021. Russia accounts for 40% of global production of the metal, used by automakers in catalytic converters to curb emissions Industrial metals also rose, led by strong gains in nickel which surged more than 20% as global supply chains tried to price in the possible absence of supplies from Russia, the third largest nickel producer.
• Brent crude soared near $130 a barrel on Monday, its highest since 2008, as the United States and European allies mull a Russian oil import ban and delays in the potential return of Iranian crude to global markets fuelled tight supply fears. The United States and European allies are exploring banning imports of Russian oil, Blinken said on Sunday, and the White House coordinated with key Congressional committees moving forward with their own ban. Global oil prices have spiked more than 60% since the start of 2022, along with other commodities, raising concerns about world economic growth and stagflation. China, world's No. 2 economy, is already targeting a slower growth of 5.5% this year. Fuel prices have surpassed 2008 records with U.S. gasoline at a high of $3.890 per gallon and heating oil futures at $4.237 per gallon Analysts at Bank of America (NYSE:BAC) said if most of Russia's oil exports are cut off, there could be a 5 million barrel or larger shortfall, and that means oil prices could double from $100 to $200 a barrel, while JP Morgan analysts said this week oil could soar to $185 per barrel this year. Russia is the world's top exporter of crude and oil products combined, with exports at around 7 million bpd, or 7% of global supply. Some volumes of Kazakhstan's oil exports from Russian ports have also faced complications. Despite the oil price surge, U.S. energy firms cut the number of operating oil rigs last week, underscoring supply concerns. In Libya, the closure of the El Feel and Sharara oilfields resulted in the loss of 330,000 barrels per day (bpd), the National Oil Corporation (NOC) said on Sunday, more than 25% of its output in 2021. Talks to revive Iran's 2015 nuclear deal with world powers were mired in uncertainty on Sunday following Russia's demands for a U.S. guarantee that the sanctions it faces over the Ukraine conflict will not hurt its trade with Tehran. China has also raised new demands, according to sources. In response to Russia's demands, U.S. Secretary of State Antony Blinken said on Sunday that the sanctions imposed on Russia over its Ukraine invasion have nothing to do with a potential nuclear deal with Iran Eurasia Group said fresh Russian demands could disrupt nuclear talks although it still kept the odds of a deal at 70%. Iran will take several months to restore oil flows even if it reaches a nuclear deal, analysts said. Separately, U.S. and Venezuelan officials discussed the possibility of easing oil sanctions on Venezuela but made scant progress toward a deal in their first high-level bilateral talks in years, five sources familiar with the matter said, as Washington seeks to separate Russia from one of its key allies.

Gold – XAU

Gold on Friday made its intraday high of US$1970.96/oz and low of US$1929.64/oz. Gold up 1.797% at US$1970.51/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1809) and breakage below will call for 1790. MACD is above zero line and histograms are also increasing trend and it will bring upward stance in the upcoming sessions. RSI is in overbought region and more upside is expected before it gets stretched. Stochastic Oscillator is in neutral territory and giving negative crossover to bearish stance for intraday trade.

Trading Strategy: Sell on Strength

Sell below 2005 keeping stop loss closing above 2005, targeting 1984-1974-1959 and 1950-1939-1924. Buy in between 1974-1924 with risk below 1924, targeting 1949-1958 and 1964-1970-1979.

Silver - XAG

Silver on Friday made its intraday high of US$25.72/oz and low of US$25.03/oz settled up by 2.12% at US$25.70/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (26.62), breakage above will lead to 27.60. MACD is below zero line and histograms are decreasing trend and it will bring bearish 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

Buy in between 25.80-22.90, targeting 25.40-25.70 and 26.00-26.40-26.75 with stop loss should be place on the breakage below 22.90. Sell in between 25.40-26.90 with stop loss above 26.90; targeting 24.80-24.40-23.90 and 23.40-23.15-22.90.

Oil - WTI

Crude Oil on Friday made an intra‐day high of US114.05/bbl, intraday low of US$105.60/bbl and settled up by 6.50% to close at US$103.04/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 20DMA i.e. 68.50 which is a support level and breakage below will call for 65.40. 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 Sell

Sell in between 108.00-111.50 with stop loss at 111.50; targeting 106.10-105.60-104.70 and 104.00-103.00. Buy above 106.10-103.00 with risk daily closing below 109.00 and targeting 107.50-108.30-109.40 and 110.

EUR/USD

EUR/USD on Friday made an intraday low of US$1.0885/EUR, high of US$1.1067/EUR and settled the day down by 1.264% to close at US$1.0925/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.347), which become immediate support, break below will target 1.1270. MACD is above zero line and 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 right now.

Trading Strategy: Neutral to Sell

Sell below 1.1010-1.1100, targeting 1.0850-1.0720-1.0640 and 1.0600-1.0520 with stop-loss at daily closing above 1.0520. Buy above 1.0850-1.0520 with risk below 1.0520, targeting 1.1011-1.1050-1.1105-1.1100-1.1270.

GBP/USD

GBP/USD on Friday made an intra‐day low of US$1.3201/GBP, high of US$1.3352/GBP and settled the day down by 0.870% to close at US$1.3229/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.3760) 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 overbought territory and giving positive crossover to confirm bullish stance. MACD is above zero line but histograms are increasing lead to upward movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy in between 1.3150-1.2925 with target 1.3200-1.3250-1.3290 and 1.3350-1.3410-1.3500 with stop loss closing below 1.2900. Sell in between 1.3200-1.3410 with targets at 1.3150-1.3090-1.3035 and 1.2970-1.2925 with stop loss should be 1.3410.

USD/JPY

USD/JPY on Friday made intra‐day low of JPY114.64/USD and made an intraday high of JPY115.55/USD and settled the day down 0.701% at JPY114.81/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 115.90-118.00 with risk above 118.00 targeting 114.90-114.50 and 113.90-113.20-112.70. Long positions above 115.50-113.70 with targets of 115.50-116.35-116.90 with stop below 113.70.