Daily Market Lookup

• The dollar remained on the defensive on Thursday as hopes for a de-escalation in the Iran-U.S. war supported oil-exposed currencies, while Tokyo resumed its verbal intervention in support of the yen, keeping speculators cautious. Iran said on Wednesday it was reviewing a U.S. peace proposal that sources indicated would formally end the war but leave unresolved key U.S. demands that Iran suspend its nuclear program and reopen the Strait of Hormuz. Analysts were worried any agreement that did not open the vital waterway to shipping would likely see oil prices rise again, with Brent edging 0.8% higher in early trading. "A corner of the market will undoubtedly view a one-page memorandum to resume negotiations over the next thirty days as significant progress," she added. "However, an MoU is unlikely to translate into an immediate resumption of shipping traffic and major production restarts." Hopes for de-escalation had seen oil prices slide nearly 8% overnight, easing inflationary fears and pulling down Treasury yields as markets pared back the risk of U.S. rate hikes The pullback in oil had boosted the euro, given the continent is far more reliant on imported oil than the United States, and it was 0.1% firmer at $1.1757 having touched a two-week top of $1.1797 overnight. The dollar index slipped to as low as 97.902, not far from the two-week low it touched overnight, and well short of last week’s top of 99.092. The risk-sensitive Australian dollar inched higher and last fetched $0.7242, just below the four-year high it touched on Wednesday. Sterling was steady at $1.3594, ahead of key local elections with global investors wary that a poor showing for the ruling Labour Party could pave the way for an unwelcome leadership challenge and renew concerns about fiscal slippage. The pound has gained nearly 7% since Labour won the 2024 general election, with the options market painting a fairly sanguine picture for the election. The yen received a further lift from speculation the Japanese authorities had intervened on Wednesday to buy the currency, sending the dollar as low as 155.00 at one stage, its strongest level in 10 weeks. The dollar was last trading at 156.15 on Thursday, with dealers on guard after Japan’s top currency diplomat Atsushi Mimura said the country was not restricted on intervention. U.S. Treasury Secretary Scott Bessent will meet Japan’s Prime Minister Sanae Takaichi next week. The Nikkei reported that they will discuss curbing speculative yen selling, among other issues. Sources told Reuters that authorities intervened on Thursday last week, with money market data suggesting they sold about $35 billion to support the yen. Since then, the market has seen three abrupt spikes in the yen through to Wednesday. Analysts though don’t expect the yen to remain firm for long. Repeated interventions raise the likelihood of broader policy action in the June–July window, consistent with the late 2024 playbook, Loo added.
• Oil prices rose over $1 on Thursday, rebounding from the previous day’s sharp losses, as investors weighed the prospects of a Middle East peace deal succeeding. Both benchmarks slumped more than 7% on Wednesday, hitting two-week lows on optimism over a possible end to the Middle East war. They pared losses, however, after U.S. President Donald Trump said it was "too soon" for face-to-face talks with Tehran and a senior Iranian lawmaker said the U.S. proposal was more of a wish list than a reality. Iran said on Wednesday it was reviewing a U.S. peace proposal that sources said would formally end the war while leaving unresolved the key U.S. demands that Iran suspend its nuclear program and reopen the Strait of Hormuz. An Iranian foreign ministry spokesperson cited by Iran’s ISNA news agency said Tehran would convey its response. Trump said he believed Iran wanted an agreement. A Pakistan mediation source and another person briefed on the talks said an agreement was close on a one-page memorandum that would formally end the conflict. U.S. media outlet Axios reported that the U.S. expects Iranian responses on several key points in the next 48 hours, citing sources saying this is the closest the parties had come to an agreement since the war began. Even if a peace deal is reached, oil supplies are expected to tighten further in coming weeks because it will take weeks for oil shipments to resume from the Middle East Gulf and reach refiners worldwide - so oil companies will continue to deplete storage tanks to meet peak summer demand.
• U.S. crude and fuel inventories continued to decline last week as countries sought to offset supply disruptions caused by the Iran crisis, the Energy Information Administration said on Wednesday. Crude stocks fell by 2.3 million barrels to 457.2 million barrels last week, compared with analyst expectations in a Reuters poll for a 3.3 million-barrel draw.

Gold – XAU

Gold on Wednesday interaday high of US$4722.73/oz and low of $4546.14/oz. God is up by 2.91% at US$4690.52/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 4710-5020 keeping stop loss closing above 5100, targeting 4680-4655-4630-4600 and 4560-4530-4500-4460-4420. Buy in between 4680-4320 with risk below 4320 targeting 4710-4750-4774-4790 and 4796-4835-4875-4900.

Silver - XAG

Silver on Wednesday its intraday high of US77.79/oz and low of US$72.60/oz settle up by 1.093% at US$72.78/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 77.60-67.00, targeting 78.10-78.60-79.70-80.25 and 80.50-81.00-81.60 with stop loss should be placed on the breakage below 67.00. Sell in between 75.10 80.00 with a stop loss above 80.00 targeting 73.60-72.90-72.00-71.50-71.00-70.50-69.80.

Oil - WTI

Crude Oil on Wednesday high of US$99.68/bbl, an intraday low of US$86.89/bbl, and settled down by 6.33% to close at US$93.31/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 upsides can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Sell

Sell in between 93.00-97.30 with stop loss at 98.00, targeting 92.60-92.00-90.70-89.90-87.90. Buy above 92.50-86.00 with risk daily closing below 86.00, targeting 93.00-93.86-94.50-95.20- and 96.00-96.60-97.30-98.10

EUR/USD

EUR/USD on Wednesday made an intraday low of US$1.1689/EUR, a high of US$1.1796/EUR, and settled up by 0.485% to close at US$1.1747/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 1.1750-1.1990, targeting 1.1755-1.1690-1.1655-1.1600 and 1.1565-1.1500-1.1450-1.1410 with stop-loss at daily closing above 1.1990. Buy above 1.1720-1.1450 with risk below 1.1450 targeting 1.1.1800 and 1.1920-1.1950-1.1990-1.2010.

GBP/USD

GBP/USD on Wednesday made a intraday low of US$1.3642/GBP, a high of US$1.3642/GBP, and settled the day up by 0.419% to close at US$1.3591/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 1.3490-1.3150 with a target of 1.3570 and 1.3600-1.3640-1.3690-1.3725 with a stop loss closing below 1.3150. Sell in between 1.3570-1.3820 with targets at 1.3490-1.3440-1.3395-1.3325-1.3275 and 1.3250-1.3190-1.3150 with a stop loss of 1.3900.

USD/JPY

USD/JPY on Wednesday made an intra‐day low of JPY155.02/USD an intraday high of 157.92/USD, and settled the day down by 0.961% at JPY156.33/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 157.80-163.10 with risk above 163.10 targeting 159.40-158.70-158.10-157.00 and 156.60-153.00-152.65-152.10. Long positions above 160.00-148.00 with targets of 160.90-161.60 and 162.20-162.60-163.00with stops below 148.00.