Just Perfect Markets

Daily Market Lookup

  • The dollar was flat on Wednesday morning in Asia, with the safe-haven asset slowly recovering heavy losses from the previous session over the uncertainty surrounding the latest stimulus measures and, in turn, U.S. economic recovery from COVID-19. The ongoing impact from the U.S. Federal Reserve’s stimulus programs saw U.S. stock indexes soar to record highs and continues to put pressure on the dollar. The Fed's intervention in the financial markets to increase liquidity also reduced demand for safe-have assets whilst increasing the appeal of risk assets, despite a bleak picture being painted for the U.S. economic recovery. Consensus within the U.S. Congress for the latest stimulus measures also remains elusive, despite House Speaker Nancy Pelosi’s statement on Tuesday that Democrats would be willing to cut their bill “in half” to reach an agreement with Republicans. Meanwhile U.S. President Trump on Tuesday took responsibility for postponing trade talks between the two countries, originally scheduled for August 15. Investors are now looking to the release of the minutes from the Fed’s FOMC meeting, due later in the day.
  • The dollar struggled to recoup heavy overnight losses on Wednesday after it slipped to 27-month low the previous session as uncertainties about an economic recovery and the U.S. fiscal stimulus package weighed. The dollar hit fresh lows against most major currencies overnight as the ongoing effects of the Federal Reserve's stimulus programmes weakened the greenback broadly and lifted U.S. stock indexes to record highs. Although the dollar often functions as a safe-haven investment in times of crisis, it has fallen since the Federal Reserve's intervention into financial markets to maintain liquidity in the midst of the COVID-19 pandemic. The Fed's programmes have pushed risk assets to all-time highs and reduced demand for safe-havens, even as economic data has painted a bleak picture of the U.S. recovery. An agreement over a new round of federal stimulusspending remained elusive, although U.S. House of Representatives Speaker Nancy Pelosi said on Tuesday that Democrats in Congress are willing to cut their coronavirus relief bill in half to get an agreement on new legislation with the White House and Republicans. Providing additional headwind for the dollar, President Donald Trump on Tuesday said a big shift to mail-in voting in the November presidential election could cause so many problems officials might have to re-do the vote. On the data front, Japan's official data on exports fell 19.2% in July from a year earlier, beating economists' forecast of 21% decrease, while the country's core machinery orders fell 7.6% in June from the previous month. Investors await the release later on Wednesday of the minutes from the July 28-29 FOMC meeting, with speculation the Fed will adopt an average inflation target, which would seek to push inflation above 2% for some time.
  • OPEC oil producers and allies such as Russia, a grouping dubbed OPEC+, meets on Wednesday to review compliance with oil cuts meant to support oil prices amid the coronavirus pandemic. OPEC+ is unlikely to change its output policy, which currently calls for reducing output by 7.7 million barrels per day (bpd) versus a record high 9.7 million bpd up until this month, according to OPEC+ sources. They said the meeting instead would focus on compliance by countries such as Iraq, Nigeria and Kazakhstan. Compliance with the cuts was seen at 95% to 97% in July, according to OPEC+ sources and a draft report seen by Reuters on Monday. That is high by OPEC standards. In July, top exporter Saudi Arabia was still pumping below its target and Iraq and Nigeria, while lagging the Gulf OPEC members on compliance, were pumping less than in previous months, according to a Reuters survey and other assessments. Saudi Arabia's King Salman bin Abdulaziz spoke to Nigerian President Muhammadu Buhari on Wednesday and stressed the importance of compliance by all participants, Saudi state news agency SPA reported. Oil was mixed on Wednesday morning in Asia, with the American Petroleum Institute (API)’s prediction of a draw in crude oil supplies overshadowed by ongoing concerns over U.S. fuel recovery. API on Tuesday reported a draw of 4.264 million barrels for the week ended August 14, beating forecasts of a 2.9 million-barrel draw prepared by Investing.com. But some investors raised concerns about U.S. fuel demand recovery, with the U.S. Congress still unable to reach a consensus on the latest stimulus measures to get economic demand recovery from COVID-19 on track. Although House Speaker Nancy Pelosi indicated that Democrats were willing to cut their stimulus proposal “in half” in order to reach a deal with Republicans, Pelosi spokesman Drew Hammill reportedly clarified that Pelosi was referring to her previous stance of meeting Republicans “halfway, not cutting our bill in half.” Investors are now looking to OPEC’s joint ministerial monitoring committee (JMMC), scheduled to take place later in the day after the meeting was postponed from the initial August 18 date. OPEC+ members are due to review adherence to output cuts. Russian Energy Minister Alexander Novak is expected to join the video meeting, despite having tested positive for COVID-19 on Tuesday.

 

 
Intraday RESISTANCE LEVELS
20th August 2020 R1 R2 R3
GOLD-XAU 1,954-1,971 1,989 2,010-2,021
Silver-XAG 28.10-29.00 29.80 30.50-31.00
Crude Oil 43.15 44.10 45.00-46.30
EURO/USD 1.1900-1.1955 1.2000 1.2050-1,2100
GBP/USD 1.3100-1.3170 1.3210 1.3290-1.3350
USD/JPY 106.10-106.90 107.30 108.10-108.90

Intraday SUPPORTS LEVELS
20th August 2020 S1 S2 S3
GOLD-XAU 1,940-1924 1,915 1,901-1,885
Silver-XAG 27.00-26.10 26.55 25.10-24.30
Crude Oil 42.00-41.00 40.60 39.50-38.50
EURO/USD 1.1850 1.1800 1.1730-1.1690
GBP/USD 1.3050-1.3015 1.2950 1.2870-1.2820
USD/JPY 105.50 104.90 104.30-103.90

Intra-Day Strategy (20th August 2020)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Buy
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

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Gold on Wednesday made its intraday high of US$2006.43/oz and low of US$1924.54/oz. Gold down 3.703% at US$1927.15/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1642) and breakage below will call for 1600. MACD is above zero line and histograms are also increasing trend and it will bring upward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving negative crossover to bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1940-1885 with risk below 1885, targeting 1954-1971-1989 and 2010-2021-2035. Sell below 2010-2065 keeping stop loss closing above 2065, targeting 1989-1981-1966 and 1940-1920-1900.

 
Intraday Support Levels
S1     1,940-1924
S2     1,915
S3     1,901-1,885
Intraday Resistance Levels
R1     1,954-1,971
R2     1,989
R3     2,010-2,021

Technical Indicators

Name   Value Action
14DRSI  

58.043

Buy
20-DMA   1971.68 Buy
50-DMA  

1855.89

Buy
100-DMA   1779.91 Buy
200-DMA   1661.02 Buy
STOCH(5,3)   78.503 Buy
MACD(12,26,9)   35.45 Sell

Silver - XAG

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Silver on Wednesday made its intraday high of US$28.01/oz and low of US$26.47/oz settled down by 3.626% at US$27.68/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 20DMA (21.60), breakage below will lead to 19.40. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is approaching overbought region, indicating buy signal for now. The Stochastic Oscillator is in neutral region and giving positive crossover to show upside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 27.10-22.50 targeting 28.20-29.00 and 29.80-30.50, stop breakage below 22.50. Sell below 28.00-30.00 with stop loss above 30.00; targeting 27.20-26.10-25.00 and 24.30-23.35.

 
Intraday  Support Levels
S1     27.00-26.10
S2     26.55
S3     25.10-24.30

Intraday  Resistance Levels
R1     28.10-29.00
R2     29.80
R3     30.50-31.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.514 Buy
20-DMA   24.90 Buy
50-DMA   20.81 Buy
100-DMA   18.30 Buy
200-DMA   17.66 Buy
STOCH(5,3)   49 268 Buy
MACD(12,26,9)   1.914 Buy

Oil - WTI

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Crude Oil on Wednesday made an intra‐day high of US42.97/bbl, intraday low of US$42.64/bbl and settled down by 0.873% to close at US$42.77/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 40.00 which is a resistance level and breakage above will call for 44.00. MACD is below zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving positive crossover for confirmation of bullish stance; while the RSI is in neutral region and more downside can be expected to reach the oversold region, which is highly probable.

Trading Strategy: Neutral to Buy

On daily charts, oil is sustaining below its 50DMA i.e. 40.00 which is a resistance level and breakage above will call for 44.00. MACD is below zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving positive crossover for confirmation of bullish stance; while the RSI is in neutral region and more downside can be expected to reach the oversold region, which is highly probable.

 
Intraday Support Levels
S1     42.00-41.00
S2     40.60
S3     39.50-38.50

Intraday Resistance Levels
R1     43.15
R2     44.10
R3     45.00-46.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.099 Sell
20-DMA   41.06 Buy
50-DMA   39.57 Buy
100-DMA   32.50 Buy
200-DMA   43.09 Sell
STOCH(5,3)   62.130 Buy
MACD(12,26,9)   0.738 Sell

EUR/USD

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EUR/USD on Wednesday an intraday low of US$1.1829/EUR, high of US$1.1951/EUR and settled the day down by 0.771% to close at US$1.1835/EUR.

Technicals in Focus:

On daily immediate resistance level, break above will target 1.1090. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in oversold territory and giving negative crossovers to signal for bearish outlook for intradaycharts, prices are sustaining below 100DMA (1.1031), which become. 14D RSI is currently in neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Buy

Buy above 1.1850-1.1540 with risk below 1.1540, targeting 1.1900-1.1950 and 1.2000-1.2100. Sell below 1.1900-1.2050 targeting 1.1850-1.1800-1.1720-1.1650 and 1.1500-1.1450-1.1400 with stop-loss at daily closing above 1.1950.

 
Intraday Support Levels
S1     1.1850
S2     1.1800
S3     1.1730-1.1690

Intraday  Resistance Levels
R1     1.1900-1.1955
R2     1.2000
R3     1.2050-1,2100

TECHNICAL INDICATORS
Name   Value Action
14DRSI   72.032 Buy
20-DMA   1.1793 Buy
50-DMA   1.1501 Buy
100-DMA   1.1224 Buy
200-DMA   1.1133 Buy
STOCH(5,3)   88.758 Buy
MACD(12,26,9)   -0.0011 Buy

GBP/USD

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GBP/USD on Wednesday made an intra‐day low of US$1.3092/GBP, high of US$1.3266/GBP and settled the day down by 1.099% to close at US$1.3092/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.2647) is become major resistance level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.3100-1.3350 with targets at 1.3050-1.3015-1.2950 and 1.2870-1.2820 stop-loss should be 1.3100. Buy above 1.3050-1.2840 with targets 1.3100-1.3170-1.3290 and 1.3350-1.3400 with stop loss closing below 1.2400.

 
Intraday Support Levels
S1     1.3050-1.3015
S2     1.2950
S3     1.2870-1.2820

Intraday Resistance Levels
R1     1.3100-1.3170
R2     1.3210
R3     1.3290-1.3350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

70.904

Buy
20-DMA   1.2871 Buy
50-DMA   1.2666 Buy
100-DMA   1.2501 Sell
200-DMA   1.2705 Sell
STOCH(5,3)   52.940 Sell
MACD(12,26,9)   0.0305 Sell

USD/JPY

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USD/JPY on Wednesday made intra‐day low of JPY105.09/USD and made an intraday high of JPY106.14/USD and settled the day down by 0.664% at JPY106.09/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 106.00-111.00 with risk above 111.00 targeting 105.50-104.90-104.50 and 103.90-103.10. Long positions above 105.50-103.00 with targets of 106.00-106.50-106.90 and 107.90-108.40-109.40 with stop below 105.00.

 
Intraday Support Levels
S1     105.50
S2     104.90
S3     104.30-103.90

INTRADAY RESISTANCE LEVELS
R1     106.10-106.90
R2     107.30
R3     108.10-108.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.904 Buy
20-DMA   107.21 Sell
50-DMA   107.45 Sell
100-DMA   107.53 Sell
200-DMA   108.36 Sell
STOCH(9,6)   44.253 Sell
MACD(12,26,9)   -0.1448 Sell

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