Daily Market Lookup

• The U.S. dollar climbed higher in early European trade Monday, gaining ground even against the euro despite Emmanuel Macron’s win in the French presidential election as traders sought out this safe haven. French President Emmanuel Macron claimed an election victory over his far-right rival Marine Le Pen on Sunday, providing the euro with a small boost as the result provided stability within the European Union, avoiding the promotion of a deeply eurosceptic politician. However, any gains for the single currency were short-lived as traders turned to the safety of the dollar due to uncertainties over the global growth outlook as the U.S. Federal Reserve tightens monetary policy. Federal Reserve Chairman Jerome Powell last week pointed to the possibility of a 50 basis point rate hike at the central bank’s next meeting in May, speeding up its monetary policy tightening after hiking by 25 basis points in March. By contrast, Japan’s central bank has been sticking rigidly to its very accommodative stance, while Europe, and thus the euro, is more exposed to the stagflationary forces emerging from the war in Ukraine. The International Monetary Fund recently cut its forecast for Eurozone growth this year to 2.8% from 3.9%. The bloc will publish its first estimate of first quarter GDP on Friday, and it is expected to have risen by 0.3% quarter-over-quarter. China’s capital Beijing reported over the weekend dozens of COVID-19 cases, prompting concerns of a prolonged strict lockdown akin to that in the financial hub of Shanghai.
• The dollar climbed on Monday as investors sought safety due to uncertainties over the global growth outlook, gaining ground even on the euro despite French President Emmanuel Macron's comfortable election victory over far-right rival Marine Le Pen. With 97% of votes counted, Macron was on course for a solid 57.4% of the vote, interior ministry figures showed. In his victory speech he acknowledged that many people had only voted for him only to keep Le Pen out, and he promised to address the sense of many French that their living standards were slipping. Markets had worried that a Le Pen victory, which was not predicted by the polls, would lead to significant economic change in the euro zone's second-largest economy. The pound has been hurt by last week's weak British retail sales and consumer-confidence data and Bank of England comments that signalled a possible slowdown in the expected upward movement of interest rates. China's yuan fell to a one-year low on Monday extending losses after posting its worst week since 2015, as investors fret about the worsening economic growth outlook due to strict COVID-19 measures and lockdowns across the country. The People's Bank of China (PBOC) set the midpoint rate on Monday at 6.4909 per dollar prior to market open, the weakest since August 2021. In the spot market, both the onshore and offshore yuan, touched their weakest since April 2021. On Monday, Beijing began three rounds of COVID-19 testing for all residents of its biggest district Chaoyang after dozens of cases were reported, prompting people to stock up on food over fears of an eventual strict lockdown akin to that in the financial hub of Shanghai. Among major currencies, the Japanese yen has been the most affected by rising U.S. interest rates, with Japan keeping its benchmark yields pinned down at ultra-low rates. On Monday morning, the dollar was weaker against the yen at 128.33.
• Oil prices slumped to about two-week lows on Monday, extending losses from last week, as concerns grew that prolonged COVID-19 lockdowns in Shanghai and potential U.S. rate hikes would hurt global economic growth and demand for fuel. Shanghai authorities battling an outbreak of COVID-19 have erected fences outside residential buildings, sparking a fresh public outcry over a lockdown that has forced much of the city's population of 25 million indoors. U.S. Federal Reserve Chairman Jerome Powell has indicated that a half-point interest rate increase "will be on the table" when the Fed meets in May. On the supply side, U.S. energy firms added oil and natural gas rigs for a fifth straight week amid high prices and prodding by the government. In Europe, the Russia-Kazakh Caspian Pipeline Consortium was resuming full exports from April 22 after almost 30 days of disruptions following repairs on one of its key loading facilities, three sources told Reuters on Friday. Some analysts said that the worsening crisis in Ukraine could raise pressure on the EU to sanction Russian oil and that prices could move higher later this year. The EU is preparing "smart sanctions" against Russian oil imports, The Times reported on Monday, citing the European Commission's executive vice president, Valdis Dombrovskis. Russia is Europe's top gas supplier and the world's second-biggest oil exporter, after Saudi Arabia. Emmanuel Macron's win in the French presidential election could also support oil prices, some analysts felt.

Gold – XAU

Gold on Friday made its intraday high of US$1955.45/oz and low of US$1926.48/oz. Gold down 0.379% at US$1931.63/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 1923-1970 keeping stop loss closing above 1970, targeting 1,907-1,900-1,889 and 1877-1868. Buy in between 1907-1868 with risk below 1868, targeting 1923-1938-1958 and 1970-1980-1996.

Silver - XAG

Silver on Friday made its intraday high of US$24.65/oz and low of US$24.04/oz settled down by 2.02% at US$24.15/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 23.70-22.05, targeting 23.95-24.55-25.10 and 25.70-26.50-26.75 with stop loss should be place on the breakage below 22.05. Sell in between 23.95-27.00 with stop loss above 27.00; targeting 23.50-23.05-22.85 and 22.50-22.05.

Oil - WTI

Crude Oil on Friday made an intra‐day high of US103.98/bbl, intraday low of US$100.82/bbl and settled down by 2.13% to close at US$101.43/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 0will 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 98.50-102.95 with stop loss at 102.95; targeting 97.00-96.10-95.00 and 93.40-92.40. Buy above 97.00-92.40 with risk daily closing below 92.40 and targeting 98.50-99.25-100.60-101.0 and 102.10-102.95.

EUR/USD

EUR/USD on Thursday made an intraday low of US$1.0769/EUR, high of US$1.0851/EUR and settled the day down by 0.300% to close at US$1.0797/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.1191), 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 1.0765-1.1145, targeting 1.0765-1.0720-1.0640 and 1.0600-1.0550 with stop-loss at daily closing above 1.1200. Buy above 1.0690-1.0450 with risk below 1.0450, targeting 1.0765-1.0820-1.0870 and 1.0900-1.0950-1.1105.

GBP/USD

GBP/USD on Friday made an intra‐day low of US$1.2822/GBP, high of US$1.3033/GBP and settled the day down by 1.469% to close at US$1.2837/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 1.2690-1.2500 with target 1.2750-1.2790-1.2840 and 1.2900-1.2970-1.3035-1.3110-1.3160 with stop loss closing below 1.2500. Sell in between 1.2750-1.3035 with targets at 1.2690 with stop loss should be 1.3300.

USD/JPY

USD/JPY on Friday made intra‐day low of JPY127.73/USD and made an intraday high of JPY129.10/USD and settled the day up 0.0973% at JPY128.46/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 129.00-131.20 with risk above 131.20 targeting 128.10-127.00-126.40 and 124.90-124.00. Long positions above 128.10-124.00 with targets of 129.00-129.60-130.00 and 130.60-131.20 with stop below 124.00.