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Daily Market Lookup

  • Asian shares drifted off on Wednesday as anxious investors awaited more earnings reports from corporate America, while the dollar held firm in the wake of robust U.S. retail data and a Brexit-driven dive in the pound. Not helping the mood was Tuesday’s threat from U.S. President Donald Trump to put tariffs on another $325 billion of Chinese goods, amid market nervousness over when face-to-face talks will resume. The fallout of the year-long trade dispute was apparent in data from Singapore, where exports sank by the most in six years in June led by a steep drop in electronics A surprisingly strong reading on U.S. retail sales released overnight had outweighed weakness in industrial production for the June quarter and boosted the dollar. Yet, it barely budged market wagers on a Federal Reserve rate cut this month, with Chicago Fed President Charles Evans touting 50 basis points of easing. Analysts at Barclays were even more dovish, arguing persistent uncertainty and soft inflation warranted quarter-point cuts in July, September, and December. Expectations of policy stimulus, and the resulting drop in bond yields, helped counter concerns about corporate profits. It slid 0.9% overnight to 27-month lows amid fears the UK could tumble out of the European Union with no trade deal to soften the blow. With the first U.S. interest rate reduction in a decade expected later this month, two Federal Reserve policymakers sketched out arguments on Tuesday on how deep the cut should be, even as a third said she needs more data before being ready to sign on at all.
  • The U.S. dollar rose on Wednesday in Asia on the back of the release of strong retail sales data, while the pound traded near two-year low on Brexit concerns. Retail sales rose 0.4% in June, the Commerce Department reported on Tuesday, compared to expectations for a slight gain of 0.1%. The stronger-than-expected retail sales showed the economy were healthy and tempered expectations of aggressive policy easing by the Federal Reserve later this month. Meanwhile, the pound inched up 0.1% against the U.S. dollar but still traded near its lowest level in two years amid concerns of a no-deal Brexit. Both Prime Minister candidates Jeremy Hunt and Boris Johnson have voiced their opposition to an Irish backstop agreement, making it even more likely that the U.K. will leave the European Union on Oct. 31 without a deal. Weak economic data and reports the Bank of England could cut interest rates instead of rising them as previously expected were also cited as headwinds for the pound.
  • The remarks, from the chiefs of the Federal Reserve regional banks of Chicago, Dallas and San Francisco, show that the U.S. central bank is edging toward a widely anticipated rate cut at its upcoming July 30-31 meeting without a consensus narrative about why a cut is needed, or even if it is. The competing cases made Tuesday by the two policymakers supportive of a rate cut suggested the decision of whether to reduce rates by a quarter or a half of a percentage point could hinge on whether the goal is to guard against developing risks in the world economy and signaled by bond markets, or deliver a solid jolt meant to boost inflation in the United States. Evans last week said he felt a reduction of half a percentage point in the Fed’s target overnight interest rate was needed for the U.S. central bank to deliver on the 2% inflation target that it has missed since setting it in 2012. The Fed set the goal as a way to keep businesses and households forward looking, and help assure a modest pace of price and wage increases. Evans and others are concerned that if they continue to undershoot, they will lose credibility and their statements and policies will become less effective The Fed’s current policy interest rate is set in a range of between 2.25% and 2.5%. By contrast, Dallas Fed President Robert Kaplan, until recently a skeptic that rates should be cut at all, said he now thinks a “tactical” reduction of a quarter point could address the risks apparently seen by bond investors, who have pushed some long-term yields below shorter-term ones But neither the inversion of the yield curve nor concern about muted inflation or headwinds that may slow economic growth was enough to convince San Francisco Fed Bank President Mary Daly yet of the need to ease policy. The economy needs to grow above its trend annual pace of 2% to get inflation back to the Fed’s 2% goal, she said.
  • Oil prices were near flat on Wednesday in Asia after slumping more than 3% overnight following news that U.S. President Donald Trump and his administration were considering talks with Iran. Overnight, multiple reports cited U.S. Secretary of State Mike Pompeo as saying "for the first time" Iranian officials "are ready to negotiate on their missile program." His remarks came after Trump told a cabinet meeting that his administration had made progress with Tehran and did not wish war or regime change there, although he did "want them out of Yemen. The news sent oil prices lower by as much as 3%, before rebounding today. In other news, the American Petroleum Institute reported that crude inventories fell by 1.4 million barrels in the week to July 12 to 460 million, compared with analysts' expectations for a decrease of 2.7 million barrels. Official data is due out later today from the U.S. government's Energy Information Administration, which is expected to report a crude drawdown 3.38 million barrels for last week, according to a consensus of analysts tracked by Investing.com. In the previous week, the EIA reported a drawdown of 9.5 million barrels. On the Sino-U.S. trade front, worries on Sino-U.S. trade developments resurfaced today after Trump said there is still a long way to go to reach a deal with China. At the White House cabinet meeting, the president said China was supposed to be buying U.S. farm products and his administration was watching to see if Beijing would do so.

 

 
Intraday RESISTANCE LEVELS
17th July 2019 R1 R2 R3
GOLD-XAU 1,409-1,425 1,433 1.440-1,450
Silver-XAG 15.70-15.90 16.20 16.60-16.90
Crude Oil 58.10-58.70 59.20 60.00-60.50
EURO/USD 1.1240-1.1280 1.1320 1.13500-1.1390
GBP/USD 1.2440-1.2450 1.2500 1.2550-1.2600
USD/JPY 108.50-109.05 109.50 110.15-110.65

Intraday SUPPORTS LEVELS
17th July 2019 S1 S2 S3
GOLD-XAU 1,400 1,390 1,380-1,374
Silver-XAG 15.50-15.25 15.05 14.60-14.30
Crude Oil 57.50-57.00 56.05 55.50-54.90
EURO/USD 1.1210 1.1180 1.1150-1.1120
GBP/USD 1.2405 1.2350-1.2300 1.2250
USD/JPY 108.00-107.60 107.00 106.50-106.00

Intra-Day Strategy (17th July 2019)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

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Gold on Tuesday made its intraday high of US$1418.14/oz and low of US$1400.71/oz. Gold down by 0.595% at US$1405.59/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1303) and breakage below will call for 1296-1288. MACD is above zero line and histograms are decreasing trend and it will bring downward stance in the upcoming sessions. RSI is in overbought region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1400-1374 with risk below 1374, targeting 1409-1418-1425 and 1433-1440. Sell below 1409-1450 keeping stop loss closing above 1450, targeting 1400-1388 and 1380-1374.

 
Intraday Support Levels
S1     1,400
S2     1,390
S3     1,380-1,374
Intraday Resistance Levels
R1     1,409-1,425
R2     1,433
R3     1.440-1,450

Technical Indicators

Name   Value Action
14DRSI  

57.513

Buy
20-DMA   1407.40 Buy
50-DMA  

1347.58

Buy
100-DMA   1320.01 Buy
200-DMA   1290.09 Buy
STOCH(5,3)   45.621 Sell
MACD(12,26,9)   16.175 Buy

Silver - XAG

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Silver on Tuesday made its intraday high of US$15.68/oz and low of US$15.30/oz. Silver settled up by 1.264% at US$15.53/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (14.93), breakage above will lead to 15.60. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in oversold region, indicating buy signal for now. The Stochastic Oscillator is in oversold region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 15.25-13.90 targeting 15.60-15.90 and 16.20-16.50; stop breakage below 13.20. Sell below 15.35-16.90 with stop loss above 16.90; targeting 15.35-15.05-14.60 and 14.30-13.90.

 
Intraday  Support Levels
S1     15.50-15.25
S2     15.05
S3     14.60-14.30

Intraday  Resistance Levels
R1     15.70-15.90
R2     16.20
R3     16.60-16.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.196 Buy
20-DMA   15.24 Sell
50-DMA   14.90 Buy
100-DMA   15.02 Buy
200-DMA   15.00 Buy
STOCH(5,3)   89.246 Buy
MACD(12,26,9)   0.0915 Buy

Oil - WTI

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Crude Oil on Tuesday made an intra‐day high of US$60.13/bbl, intraday low of US$59.15/bbl and settled down by 1.59% to close at US$59.54/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 55.88 which is a resistance level and breakage above will call for 59.60. MACD is above zero line and histograms are in decreasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in oversold region and giving negative crossover for confirmation of bearish stance; while the RSI is in oversold region and more downside can be expected.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 58.10-60.50 with stop loss at 60.50; targeting 57.50-57.00-56.05 and 55.50-54.50. Buy above 57.50-54 with risk daily closing below 58.10 and targeting 60.50-61.00-61.90 and 62.50-63.30.

 
Intraday Support Levels
S1     57.50-57.00
S2     56.05
S3     55.50-54.90

Intraday Resistance Levels
R1     58.10-58.70
R2     59.20
R3     60.00-60.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.821 Sell
20-DMA   58.34 Buy
50-DMA   57.62 Sell
100-DMA   59.34 Sell
200-DMA   57.70 Sell
STOCH(5,3)   26.130 Buy
MACD(12,26,9)   0.526 Sell

EUR/USD

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EUR/USD on Tuesday made an intraday low of US$1.1201/EUR, high of US$1.1262/EUR and settled the day down by 0.419% to close at US$1.1209/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.1349), which become immediate resistance level, break above will target 1.1320-1.1280. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in oversold 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.

Trading Strategy: Neutral to Buy

Buy above 1.1210-1.1120 with risk below 1.1120, targeting 1.1240-1.1280-1.1320 and 1.1390-1.1420. Sell below 1.1240-1.1390 targeting 1.1220-1.1180 and 1.1150-1.1120 with stop-loss at daily closing above 1.1400.

 
Intraday Support Levels
S1     1.1210
S2     1.1180
S3     1.1150-1.1120

Intraday  Resistance Levels
R1     1.1240-1.1280
R2     1.1320
R3     1.13500-1.1390

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.431 Buy
20-DMA   1.1287 Sell
50-DMA   1.1243 Sell
100-DMA   1.1250 Sell
200-DMA   1.1320 Sell
STOCH(5,3)   31.157 Buy
MACD(12,26,9)   0.0001 Buy

GBP/USD

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GBP/USD on Tuesday made an intra‐day low of US$1.2509/GBP, high of US$1.2577/GBP and settled the day down by 0.204% to close at US$1.2514/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 200DMA (1.2960) is become major support 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 positive crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to downward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.2550-1.12760 with targets at 1.2500-1.2440-1.2405 and 1.2350-1.2300 top should be below 1.2760. Buy above 1.2550-1.2300 with targets 1.2550-1.2600 and 1.2650-1.2700-1.2750 with stop loss closing below 1.2300.

 
Intraday Support Levels
S1     1.2405
S2     1.2350-1.2300
S3     1.2250

Intraday Resistance Levels
R1     1.2440-1.2450
R2     1.2500
R3     1.2550-1.2600

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

39.097

Buy
20-DMA   1.2599 Sell
50-DMA   1.2674 Sell
100-DMA   1.2888 Sell
200-DMA   1.2862 Sell
STOCH(5,3)   56.175 Sell
MACD(12,26,9)   -0.0061 Sell

USD/JPY

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USD/JPY on Tuesday made intra‐day low of JPY107.79/USD and made an intraday high of JPY108.37/USD and settled the day up by 0.301% at JPY108.22/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (110.64), 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 oversold territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 108.50-111.00 with risk above 111.00 targeting 108.00-108.50-107.60 and 107.00-106.50. Long positions above 108.50-106.00 with targets of 109.05-109.50-110.00-110.60 with stop below 106.00.

 
Intraday Support Levels
S1     108.00-107.60
S2     107.00
S3     106.50-106.00

INTRADAY RESISTANCE LEVELS
R1     108.50-109.05
R2     109.50
R3     110.15-110.65

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.190 Buy
20-DMA   108.03 Sell
50-DMA   108.96 Sell
100-DMA   110.14 Buy
200-DMA   110.88 Sell
STOCH(9,6)   90.955 Buy
MACD(12,26,9)   -0.295 Buy

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