Daily Market Lookup

• Most Asian currencies moved in a tight range on Monday as focus remained on a potential escalation in the U.S.-Israel war on Iran, with most regional currencies nursing recent losses. The Japanese yen fared better than its peers after Bank of Japan Governor Kazuo Ueda struck a somewhat hawkish tone in a parliamentary address, while top officials warned of potential moves against speculation in currency markets. The dollar index and dollar index futures were flat in Asian trade after rebounding back above the 100 point level last week, as rising oil prices due to the Iran conflict saw markets further pare back expectations of interest rate cuts by the Federal Reserve. The dollar showed little reaction to U.S. President Donald Trump stating that negotiations with Iran were going well, and that a ceasefire could be close. The yen was aided by intervention threats from Japanese officials. Top currency diplomat Atsushi Mimura said on Monday that authorities may need to take “decisive steps” if speculation against the yen persists. His comments were the strongest yet verbal warning on potential currency market intervention in Japan. USDJPY testing the 160 yen level has invited intervention in the past two years. Separately, BOJ Governor Kazuo Ueda told parliament that the central bank would closely watch yen moves and their effects on import-driven inflation. His comments suggested that the BOJ could hike interest rates in the coming months to strengthen the yen and offset higher inflation from imports, especially amid rising energy prices. Risk appetite in the region remained largely frail as markets fretted over the impact of a prolonged war in Iran, which has dire implications for the flow of oil through the Strait of Hormuz Iran allowed 20 Pakistan flagged tankers to pass through the Strait over the weekend, but has kept the passage effectively closed over U.S. and Israeli aggression. The war could enter a new front after Yemen’s Houthis attacked Israel over the weekend. The Houthis, who are backed by Iran, have the capacity to launch attacks in the Red Sea. Several Asian economies depend heavily on energy flows from the Middle East, leaving them vulnerable to prolonged supply disruptions.
• Oil prices rose sharply on Monday after Yemen’s Houthi group attacked Israel over the weekend, pointing to a broader scope for the war in the Middle East. Continued hostilities between the U.S., Israel, and Iran also pointed to little de-escalation in the war, with Tehran stating that it was prepared for a U.S. ground invasion as Washington deployed more troops to the Middle East. Oil prices took few cues from U.S. President Donald Trump offering encouraging comments on negotiations with Iran. Get more breaking news and key insights on oil during the Iran war by subscribing to InvestingPro The Yemen-based, Iran-backed Houthis said on Sunday that they had launched a barrage of missiles against Israel, and vowed to launch more attacks. Their joining the war sparked concerns over a potential escalation in the conflict, given that the group has the capability to attack ships passing through the Red Sea. "The Houthis’ weekend involvement and the arrival of additional US troops underscore the conflict’s widening scope," OCBC analysts said in a note. Israeli forces said they were attacking targets across Iran’s capital over the weekend, while the U.S. said that it had deployed 3,500 troops in the Middle East aboard the USS Tripoli warship. Oil was sitting on stellar gains in March, with Brent up nearly 60% as the onset of the U.S.-Israel war on Iran greatly disrupted global supplies. Iran effectively blocked the Strait of Hormuz, a key shipping lane that supplies 20% of the world’s oil consumption. Oil markets did little to stem their advance after Trump said on Sunday evening that negotiations with Iran were ongoing and a deal was close. Trump also claimed that Iran had allowed 20 oil tankers to pass through the Strait of Hormuz as concessions to the United States. Reports over the weekend showed 20 Pakistan-flagged oil tankers being allowed to cross the Strait Pakistan said it was prepared to host talks between the U.S. and Iran after Washington proposed a ceasefire and called for negotiations. But Tehran has largely rejected the notion of direct talks with the U.S., and also accused Washington of secretly planning a ground invasion over the weekend. Separately, Trump told the Financial Times that he was open to taking over Iranian oil, while a Wall Street Journal report said the U.S. was considering seizing Iran’s uranium. Both moves could involve U.S. troops in Iran and would mark a major escalation in the conflict.

Gold – XAU

Gold on Friday interaday high of US$4544.36/oz and low of $4375.30/oz. God is up by 2.33% at US$4493.11/oz.

Technicals in Focus:

On the daily charts, gold trades higher than 20DMA (2197). If it drops below this level, it could lead to 2,100. The MACD is currently above the zero line and the histograms are showing an increasing trend, indicating that there may be upward movement in the coming sessions. The RSI is currently at 83.04, which is in the overbought region, suggesting there may be selling pressure in the next 2 to 3 sessions. The Stochastic Oscillator is also in the overbought territory but has given a positive crossover, indicating a bullish stance for intraday trades, but rebound in expected in all the overbought indicators.

Trading Strategy: Sell on Strength

Sell below 4550-4770 keeping stop loss closing above 4800, targeting 4500-4460-4420-4390 and 4371-4360-4340-4306. Buy in between 4500-4240 with risk below 4240 targeting 4550-4570-4602-4655 and 4680-4700-4720-4750.

Silver - XAG

Silver on Friday its intraday high of US71.62/oz and low of US$67.36/oz settle up by 2.04% at US$69.67/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 20MA (25.05), breakage above will lead to 23.73. MACD is below the zero line and histograms are increasing trend, bringing a bullish stance in the upcoming sessions. RSI is in the oversold region, indicating a sell signal for now. The Stochastic Oscillator is in the overbought region and gives a positive crossover to show an upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 69.00-63.00, targeting 68.90-69.50-70.20-70.90 and 70.90-71.50-72.00-72.60 with stop loss should be placed on the breakage below 63.00. Sell in between 71.00-73.60 with a stop loss above 74.00 targeting 68.00-67.10-66.50-66.10-65.00 and 64.40-63.00-62.00.

Oil - WTI

Crude Oil on Friday high of US$99.03/bbl, an intraday low of US$90.85/bbl, and settled up by 7.01% to close at US$98.91/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 75.37, a support level, and breakage above will call for 77.48. MACD is above the zero line and histograms are in increasing mode will bring a bullish stance in the upcoming sessions. The Stochastic Oscillator is in the overbought region, giving a negative crossover to confirm a bearish stance; while the RSI is in the neutral region, more upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Sell

Sell in between 99.00-91.20 with stop loss at 91.00, targeting 97.70-97.00-98.60-95.50 and 94.80-93.60-92.90-92.00. Buy above 97.70-91.10 with risk daily closing below 91.00, targeting 98.60-99.50-100.00 and 100.50-100.90-101.50.

EUR/USD

EUR/USD on Friday an intraday low of US$1.1501/EUR, a high of US$1.1547/EUR, and settled the day down by 0.234% to close at US$1.1506/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.1661), which becomes immediate support, a break below will target 1.1695. MACD is above the zero line and histograms are increasing mode, bringing a bullish view. Stochastic is in oversold territory, giving negative crossovers to the bullish outlook for intraday. 14D RSI is currently in a neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Sell

Sell below 1.1550-1.1990, targeting 1.1500 and 1.1450-1.1410-1.1350 with stop-loss at daily closing above 1.1990. Buy above 1.1600-1.1450 with risk below 1.1450 targeting 1.1655-1.1690-1.1755-1.1800 and 1.1920-1.1950-1.1990-1.2010.

GBP/USD

GBP/USD on Friday made a intraday low of US$1.3258/GBP, a high of US$1.3346/GBP, and settled the day down by 0.104% to close at US$1.3258/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2674) is becoming a support level. 14-D RSI is currently in a neutral region and direction is difficult to predict on an RSI basis. The Stochastic Oscillator is in oversold territory and gives a positive crossover to confirm a bullish stance. MACD is above the zero line, but histograms are increasing leading to movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy between 1.3325-1.3150 with a target of 1.3395-1.3440-1.3490-1.3530 and 1.3600-1.3640-1.3690-1.3725 with a stop loss closing below 1.3150. Sell in between 1.3395-1.3820 with targets at 1.3440-1.3395-1.3325-1.3275 and 1.3250-1.3190-1.3150 with a stop loss of 1.3700.

USD/JPY

USD/JPY on Friday made an intra‐day low of JPY159.44/USD an intraday high of 160.40/USD, and settled the day up by 0.392% at JPY160.24/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (152.35), major support on the daily chart. 14-D RSI is currently in the overbought region and chances of downward are expected based on RSI. MACD is above the zero line but histograms are decreasing mode which might lead to downward movement. The Stochastic Oscillator is in overbought territory and signaling to sell as it has given a negative crossover to confirm a bearish stance.

Trading Strategy: Neutral to Sell

Sell below 157.90-160.10 with risk above 160.10 targeting 157.10-156.60153.00-152.65-152.10 and 151.70-151.00-150.35 Long positions above 157.10-148.00 with targets of 157.90-158.30-158.70 and 159.20-159.45-160.00 with stops below 148.00.