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Daily Market Lookup

  • Asian shares flat lined on Wednesday as worries about global recession and endless trade wars vied with hopes for a lot more monetary and fiscal stimulus to keep growth going. Much depends on what the Federal Reserve does with U.S. interest rates, making markets hyper-sensitive to the minutes - due later on Wednesday - of its last meeting. Traders are also awaiting the central bank’s annual Jackson Hole seminar later this week and a Group of Seven summit this weekend for clues on what additional steps policymakers will take to boost economic growth. Morgan Stanley economist Ellen Zentner advised clients to watch for the use of the word “somewhat” when Fed Chair Powell describes further policy adjustments. With so much riding on the Fed, investors were understandably cautious. MSCI’s broadest index of Asia-Pacific shares outside Japan dithered either side of flat after three straight days of gains. President Donald Trump showed no signs of backing down in his tussle with China, declaring on Tuesday a confrontation were necessary even if it caused short-term harm to the U.S. economy. His strongly-worded remarks came hours before his government announced approval of an $8 billion sale of Lockheed Martin F-16 fighter jets to Taiwan, a move sure to draw Beijing’s ire and further dim prospects for a quick trade deal. Political turmoil in Hong Kong, Britain and Italy has also heightened uncertainties for investors. The prospect of new elections in Italy after the resignation of Prime Minister Giuseppe Conte added to jitters, sending Italian sovereign bond yields sliding. That was enough to prompt Trump and his advisers to examine ways to provide a fiscal boost to the U.S. economy, should it be deemed necessary. In addition, the central banks of the euro zone, Australia and China are all expected open the monetary spigot further this year, while Germany is considering fiscal stimulus.
  • The dollar was on the defensive on Wednesday, elbowed off a three-week peak by a reversal in U.S. yields as they headed south again ahead of a meeting of central bankers, at which the Federal Reserve is expected to give clues on further rate cuts. Central bankers will gather at Jackson Hole, Wyoming, on Friday with markets focused on a scheduled speech by Fed Chair Jerome Powell. His comments will take center stage especially after last week's inversion of the U.S. yield curve -widely regarded as a recession signal- boosted expectations for the Fed to lower interest rates at its September policy meeting. Faced with rising risks to the U.S. economy, the central bank in July cut rates for the first time since the financial crisis U.S. yields, however, declined overnight on the prospect of more easing by the Fed. Takuya Kanda, general manager at Gaitame.Com Research Institute, believes U.S. President Donald Trump's "strong desire for deep rate cuts" may raise hopes among some traders of strong easing signals at Jackson Hole. But he also warned that Powell may opt to give little away in his speech as the Fed prepares for the September policy review. Investors will also be looking for clues on the Fed's plans in minutes of its July policy meeting due later on Wednesday. The single currency dipped briefly after Italy's Prime Minister Giuseppe Conte announced his resignation on Tuesday. The pound rose after German Chancellor Angela Merkel said the European Union would think about practical solutions regarding the post-Brexit Irish border.
  • Prices for Brent oil rose above $60 a barrel for the first time in over a week on Wednesday amid data that showed a larger-than-expected drawdown in U.S. crude inventories, but ongoing worries about a global economic recession capped gains. U.S. crude oil stocks fell by 3.5 million barrels to 439.8 million in the week to Aug. 16, data from industry group the American Petroleum Institute (API) showed on Tuesday. Analysts polled by Reuters had expected a decrease of 1.9 million barrels. Inventory numbers from the government's Energy Information Administration (EIA) are due at 10:30 a.m. EDT (1430 GMT) on Wednesday. Tensions in the Middle East remained in focus as U.S. Secretary of State Mike Pompeo said on Tuesday that the country would take every action it can to prevent an Iranian tanker sailing in the Mediterranean from delivering oil to Syria in contravention of U.S. sanctions. Crude prices were also buoyed by official data showing lower exports in June from Saudi Arabia, the world's top oil exporter. Saudi Arabia plans to keep its crude oil exports below 7 million bpd in August and September despite strong demand from customers, to bring the market back to balance, a Saudi oil official told Reuters earlier this month. But uncertainty over the global economic outlook amid the Sino-U.S. trade war capped gains in oil prices. Crude prices have been whipsawed this month amid conflicting indicators of whether the trade war will move toward resolution. Germany is preparing fiscal stimulus measures to head off the chances of a deep recession in Europe’s biggest economy, while more Federal Reserve rate cuts are expected to shore up American growth. The Federal Reserve will hold its annual symposium in Wyoming later in the week, where Chairman Jerome Powell’s remarks will be closely watched. American crude stockpiles probably fell by 1.5 million barrels last week, according to the median estimate in a Bloomberg survey. The industry-funded American Petroleum Institute discloses its own tally later Tuesday.

 

 
Intraday RESISTANCE LEVELS
21st August 2019 R1 R2 R3
GOLD-XAU 1,509-1,516 1,526 1,539-1,550
Silver-XAG 17.50 17.90 18.50-18.90
Crude Oil 56.50 57.40-58.20 59.00
EURO/USD 1.1120-1.1150 1.1250 1.1250-1.1290
GBP/USD 1.2160 1.2190 1.2250-1.2300
USD/JPY 106.50 107.00-107.60 108.20

Intraday SUPPORTS LEVELS
21st August 2019 S1 S2 S3
GOLD-XAU 1,489 1,481-1,474 1,466
Silver-XAG 17.00-16.80 16.50 15.90-15.50
Crude Oil 56.05-55.50 54.90 54.50-53.60
EURO/USD 1.1070-1.1030 1.0990 1.0900-1.0850
GBP/USD 1.2120-1.2065 1.2010 1.1980-1.1950
USD/JPY 106.10-105.60 105.00 104.60-104.00

Intra-Day Strategy (21st August 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$1508.47/oz and low of US$1492.81/oz. Gold up by 0.766% at US$1507.10/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1410) and breakage below will call for 1400. 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 overbought 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 1500-1469 with risk below 1469, targeting 1516-1526-1532 and 1539-1550. Sell below 1516-1550 keeping stop loss closing above 1550, targeting 1500-1489 and 1481- 1474.

 
Intraday Support Levels
S1     1,489
S2     1,481-1,474
S3     1,466
Intraday Resistance Levels
R1     1,509-1,516
R2     1,526
R3     1,539-1,550

Technical Indicators

Name   Value Action
14DRSI  

62.193

Buy
20-DMA   1474.20 Buy
50-DMA  

1430.98

Buy
100-DMA   1361.08 Buy
200-DMA   1320.14 Buy
STOCH(5,3)   32.519 Sell
MACD(12,26,9)   26.325 Buy

Silver - XAG

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Silver on Tuesday made its intraday high of US$17.17/oz and low of US$16.84/oz. Silver settled up by 0.309% at US$17.14/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 50DMA (15.70), breakage below will lead to 15.20. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in overbought region, indicating buy signal for now. The Stochastic Oscillator is in overbought 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 17.00-15.00 targeting 17.50-17.90 and 18.50-18.90; stop breakage below 15.00. Sell below 17.50-18.90 with stop loss above 18.90; targeting 17.20-16.90-16.60 and 16.20-15.90.

 
Intraday  Support Levels
S1     17.00-16.80
S2     16.50
S3     15.90-15.50

Intraday  Resistance Levels
R1     17.50
R2     17.90
R3     18.50-18.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.093 Buy
20-DMA   16.74 Sell
50-DMA   15.94 Buy
100-DMA   15.37 Buy
200-DMA   15.27 Buy
STOCH(5,3)   42.246 Sell
MACD(12,26,9)   0.346 Buy

Oil - WTI

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Crude Oil on Tuesday made an intra‐day high of US$56.49/bbl, intraday low of US$55.09/bbl and settled up by 0.035% to close at US$56.00/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 56.50-59.00 with stop loss at 59.00; targeting 56.05-55.50-54.90 and 54.05-53.60-53.00. Buy above 56.05-52.60 with risk daily closing below 52.60 and targeting 56.50-57.00 and 57.40-58.20-59.00.

 
Intraday Support Levels
S1     56.05-55.50
S2     54.90
S3     54.50-53.60

Intraday Resistance Levels
R1     56.50
R2     57.40-58.20
R3     59.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.871 Sell
20-DMA   55.29 Buy
50-DMA   56.27 Buy
100-DMA   58.63 Sell
200-DMA   56.23 Buy
STOCH(5,3)   56.130 Buy
MACD(12,26,9)   -0.390 Sell

EUR/USD

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EUR/USD on Tuesday made an intraday low of US$1.1090/EUR, high of US$1.1106/EUR and settled the day up by 0.204% to close at US$1.1099/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1293), which become immediate resistance level, break above will target 1.1320-1.1350. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider.

Trading Strategy: Neutral to Buy

Buy above 1.1070-1.0850 with risk below 1.0980, targeting 1.1160-1.1200-1.1250 and 1.1290-1.1350. Sell below 1.1160-1.1350 targeting 1.1130-1.1090 and 1.1005-1.0980 with stop-loss at daily closing above 1.1350.

 
Intraday Support Levels
S1     1.1070-1.1030
S2     1.0990
S3     1.0900-1.0850

Intraday  Resistance Levels
R1     1.1120-1.1150
R2     1.1250
R3     1.1250-1.1290

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.898 Buy
20-DMA   1.1140 Sell
50-DMA   1.1213 Sell
100-DMA   1.1215 Sell
200-DMA   1.1284 Sell
STOCH(5,3)   19.958 Sell
MACD(12,26,9)   -0.0013 Buy

GBP/USD

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GBP/USD on Tuesday made an intra‐day low of US$1.2063/GBP, high of US$1.2179/GBP and settled the day up by 0.338% to close at US$1.2165/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 1.2120-1.2300 with targets at 1.2065-1.2010-1.1980 and 1.1950-1.1900 stop-loss should be below 1.2250. Buy above 1.2065-1.1900 with targets 1.2120-1.2150 and 1.2190-1.2250-1.2300 with stop loss closing below 1.2300.

 
Intraday Support Levels
S1     1.2120-1.2065
S2     1.2010
S3     1.1980-1.1950

Intraday Resistance Levels
R1     1.2160
R2     1.2190
R3     1.2250-1.2300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

39.307

Buy
20-DMA   1.2185 Sell
50-DMA   1.2426 Sell
100-DMA   1.2662 Sell
200-DMA   1.2792 Sell
STOCH(5,3)   68.175 Buy
MACD(12,26,9)   -0.0011 Sell

USD/JPY

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USD/JPY on Tuesday made intra‐day low of JPY106.15/USD and made an intraday high of JPY106.68/USD and settled the day down by 0.379% at JPY106.22/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (107.84), 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 106.50-108.00 with risk above 108.00 targeting 106.10-105.80-105.00 and 104.50-104.00. Long positions above 105.80-104.00 with targets of 106.50-107.00 and 107.60-108.00-109.05 with stop below 106.00.

 
Intraday Support Levels
S1     106.10-105.60
S2     105.00
S3     104.60-104.00

INTRADAY RESISTANCE LEVELS
R1     106.50
R2     107.00-107.60
R3     108.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.684 Buy
20-DMA   107.10 Sell
50-DMA   107.67 Sell
100-DMA   109.11 Buy
200-DMA   110.11 Sell
STOCH(9,6)   52.253 Buy
MACD(12,26,9)   -0.553 Buy

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