WTI
WTI crude oil prices continued their upward momentum, trading around $81.00 on Monday. The market sentiment remains buoyant, primarily driven by a weaker US Dollar and the revised demand outlook from the International Energy Agency (IEA). The IEA's forecast of significantly less global oil production for the remainder of 2024, coupled with OPEC+'s decision to extend voluntary production cuts through the second quarter, continues to underpin prices.
Moreover, ongoing geopolitical tensions in the Middle East add further support to WTI prices. The potential disruption to oil supplies from the region keeps investors cautious and contributes to the bullish sentiment in the market. With the draw on stockpiles anticipated throughout 2024, the outlook for WTI remains positive in the near term.
USDJPY
The USDJPY pair extended its decline, nearing 151.20 during the Asian session on Monday. This downward movement follows the release of the Bank of Japan (BoJ) Minutes from the January policy meeting, where BoJ Board members acknowledged the increasing likelihood of reaching the central bank's inflation target gradually.
The continued decline in USDJPY is primarily attributed to the market's reaction to the BoJ's discussions regarding potential measures in response to a positive cycle of wages and inflation. The prospect of the BoJ implementing supportive measures has weighed on the US Dollar against the Japanese Yen, driving the pair lower.
Furthermore, the overall weakness in the US Dollar across major currency pairs adds to the downward pressure on USD/JPY. As investors assess central bank policies and economic data, the pair is likely to remain under selling pressure in the near term.
XAUUSD
XAUUSD prices held above the mid-$2,100s during the early Asian trading hours on Monday, continuing their recovery. The yellow metal's upward movement is bolstered by the higher possibility of the US Federal Reserve implementing rate cuts later this year. Last week, the Fed left its benchmark interest rate unchanged after its March meeting but hinted at the possibility of three rate cuts in 2024.
The Fed Chairman Jerome Powell's dovish stance and the prospect of monetary policy easing have fueled investor demand for gold as a hedge against inflation and economic uncertainty. With expectations of lower interest rates, non-yielding assets like gold become more attractive to investors, supporting its price.
Additionally, ongoing geopolitical tensions and concerns surrounding global economic growth further contribute to the bullish sentiment in the gold market. As investors seek safe-haven assets amid market volatility, gold is likely to remain supported at current levels.
Entry Suggestions
Based on the analysis of the current market trends:
WTI :Consider long positions in WTI crude oil, targeting potential resistance levels at $82.50 and $85.00. Maintain a stop-loss below $79.00 to manage downside risks.
USDJPY: Favor short positions in USDJPY, targeting support levels at 150.50 and 149.00. Place a stop-loss above 152.00 to mitigate potential losses in case of a reversal.
XAUUSD: Look for buying opportunities in gold, aiming for resistance levels at $2,150 and $2,200. Implement a stop-loss below $2,100 to protect against adverse price movements.
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