Daily Market Lookup

• The U.S. dollar rose on Thursday, boosted by its status as a safe haven asset after President Donald Trump signaled further escalation in the U.S. operation against Iran/. Market participants this week moved into risk assets and away from the dollar after signs of de-escalation between the U.S. and Iran. Sentiment was strong going into Trump’s scheduled address to the nation late on Wednesday. However, the mood quickly soured after Trump said the U.S. will ramp up its operation against Iran in the coming weeks and that Washington was close to achieving its objectives. The president also offered no details on the reopening of the Strait of Hormuz, instead reiterating his message to other countries to "just take" the critical waterway through which a fifth of the world’s oil and gas flows."We have seen the first part of the de-escalation trade in FX," strategists at ING led by Frantisek Taborsky said in a note. Sentiment was later boosted after Iran’s state TV said the country was developing a protocol with Oman to monitor vessel traffic through the strait. Iran will also set a toll for ships passing through the strait, a moveTurning to other major currencies, the rise in the U.S. dollar largely weighed on developed market peers on Thursday. The euro EUR/USD fell as much as 0.4%, though it had reversed course and was last up marginally to 1.1539. Meanwhile, the sterling GBP/USD logged a bigger decline of as much as 0.6%, though it was last little changed at 1.3222. Britain is highly exposed to energy imports, and has a history of having to navigate through energy supply shocks.Separately, a survey by the Bank of England showed British firms polled in March expected to raise their prices by 3.7% over the next year, compared to 3.4% when polled in February. The rise was largely due to firms adjusting their expectations due to surging oil prices from the Middle East conflict.
• U.S. oil prices settled more than 11% higher and Brent soared nearly 8% on Thursday in volatile trading, as traders worried about prolonged disruptions to oil supply the day after President Donald Trump said the United States would continue attacks on Iran. Both benchmarks remained below highs near $120 a barrel touched earlier in the conflict. Trump said military operations would be intensified, but did not specify a timeline for ending hostilities. He gave no details on any steps that could lead to a reopening of the Strait of Hormuz Iran is drafting a protocol with Oman to monitor traffic in the strait, an Iranian foreign ministry official said, after a Bloomberg report. Iran has effectively shut down the narrow waterway through which a fifth of global oil and liquefied natural gas is shipped, in retaliation for U.S.-Israeli strikes that began on February 28. Reopening it has become a priority for governments around the world as energy prices soar WTI, which typically trades below Brent, was pricing nearly $3 over Brent as the U.S. contract was trading for May deliveries, while the Brent contract was trading for June deliveries. WTI’s premium over the global benchmark was the highest in a year. Federal Reserve Bank of Dallas President Lorie Logan said on Thursday that a swift war resolution may mean economic impact could be pretty moderate, adding that the economic outlook was uncertain due to the crisis. The United States has some buffers to impacts from the war, Logan said. Brent crude prices could average $95 a barrel in the base case and $130 a barrel in the bull case in the second half of the year, Citi said, while oil prices could climb to between $120 and $130 a barrel in the near-term, JP Morgan said. Prices could rise above $150 if the Strait remains closed into the middle of May, JP Morgan added U.S. oil rigs, an indicator of future output, rose by two to 411 this week, energy services firm Baker Hughes said. An increase in prices for oil to be delivered in future months has producers considering adding more rigs, but they have cautioned that they would like to see the higher prices hold for longer to do so. Front-month WTI traded at its largest-ever premium over the second-month and seventh-month contract on Thursday. Britain is hosting a virtual meeting of around 40 countries to discuss options for reopening the Strait of Hormuz. The United States is not due to attend OPEC+, meanwhile, is likely to weigh a further oil output increase on Sunday, sources said. This would position members to add more barrels should the Strait of Hormuz reopen but is not likely to meaningfully increase supply before then.
• In Russia, Ukraine’s strikes on port infrastructure, pipelines and refineries have reduced export capability by 1 million barrels per day, or a fifth of total capacity, sources say, enough to set the stage for imminent production cuts. The head of the International Energy Agency also said that supply disruptions would start to affect Europe’s economy in April, after the region had previously been shielded by cargoes contracted before the start of the war.

Gold – XAU

Gold on Thursday interaday high of US$4792.88/oz and low of $4661.00/oz. God is up by 18.84% at US$5019.07/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 Thursday its intraday high of US76.10/oz and low of US$73.75/oz settle up by 2.86% at US$75.04/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 73.00-63.00, targeting 73.00-73.60-74.10-74.60 and 75.00-75.90-76.50-77.00 with stop loss should be placed on the breakage below 63.00. Sell in between 73.60-77.00 with a stop loss above 77.00 targeting 72.60-72.00-71.50-70.90 and 70.20-69.50-68.90-68.00.

Oil - WTI

Crude Oil on Thursday high of US$98.81/bbl, an intraday low of US$92.45/bbl, and settled up by 3.382% to close at US$94.15/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 99.40-91.20 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 Thursday an intraday low of US$1.1442/EUR, a high of US$1.16049/EUR, and settled the day down by 0.344% to close at US$1.1537/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 Thursday made a intraday low of US$1.3180/GBP, a high of US$1.33319/GBP, and settled the day down by 0.534% to close at US$1.3224/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 Thursday made an intra‐day low of JPY1580.55/USD an intraday high of 160.44/USD, and settled the day down by 0.53% at JPY159.56/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 159.90-163.10 with risk above 160.10 targeting 157.10-156.60-153.00-152.65-152.10 and 151.70-151.00-150.35 Long positions above 158.10-148.00 with targets of 157.90-158.30-158.70 and 159.20-159.45-160.00 with stops below 148.00.