Asian Open: Gold breaks out, oil pulls back as supply concerns ease

Thursday US cash market close:

The Dow Jones Industrial rose 349.44 points (1.02%) to close at 34,707.94
The S&P 500 index rose 63.92 points (2.51%) to close at 34,058.75
The Nasdaq 100 index rose 318.15 points (2.2%) to close at 14,765.70

Asian futures:

Australia's ASX 200 futures are up 0 points (0.03%), the cash market is currently estimated to open at 7,387.10
Japan's Nikkei 225 futures are up 260 points (0.93%), the cash market is currently estimated to open at 28,370.39
Hong Kong's Hang Seng futures are down -96 points (-0.44%), the cash market is currently estimated to open at 21,849.95
China's A50 Index futures are down -3 points (-0.02%), the cash market is currently estimated to open at 13,785.97

Our anticipated pullback on US indices is yet to materialise, with major benchmarks all posting gains by the close. Tech stocks led the rebound with the Nasdaq rising 2.2%. The S&P 500 closed above 4520 and 88% of its stocks advanced, with all of its 11 sectors posting gains.

ASX 200:

7400 remains the key level for the index heading into the weekend as volatility has receded as prices drifted towards it. A positive lead from Wall Street and higher futures market means we should see a break above it, but the proof in the pudding will be to see if it can close the week above it.

ASX 200: 7387.1 (0.12%), 24 March 2022

Utilities (2.56%) was the strongest sector and Info Tech (-0.76%) was the weakest
4 out of the 11 sectors closed higher
7 out of the 11 sectors closed lower
4 out of the 11 sectors outperformed the index
63 (31.50%) stocks advanced, 125 (62.50%) stocks declined

Outperformers:

+7.28% - AVZ Minerals Ltd (AVZ.AX)
+6.51% - Whitehaven Coal Ltd (WHC.AX)
+4.96% - Brickworks Ltd (BKW.AX)

Underperformers:

-7.42% - Telix Pharmaceuticals Ltd (TLX.AX)
-5.17% - Zip Co Ltd (Z1P.AX)
-4.26% - Healius Ltd (HLS.AX)

Oil prices pulled back

WTI is back below $115 after pulling back perfectly form a 61.5% Fibonacci ratio. It had rallied on the hype that EU officials were to discuss how to remove Russian oil imports and, without such action hitting headlines, allowed energy prices to retrace. But the US is also in discussion for another coordinated release of its oil supplies to alleviate supply concerns. Gasoline was down around -3%, although natural gas rose 3.4%.

Ultra-dovish BOJ continues to weigh on the yen

The Japanese yen continue to tumble after BOJ continued to hammer home that their ultra-loose monetary policy is here to stay, and for quite some time. USD/JPY closed above 1.22 for the first time since December 2015 and is currently enjoying its most bullish month since November 2016. Yen weakness was broadly spready with CAD/JPY outperforming its peers to rise 1.3%. With such strong (and dovish) views from BOJ members it is difficult to see how today’s inflation data will account for much. The weaker yen has been highly beneficial for the Nikkei which has now risen 14% in two weeks and has closed back above its 200-day eMA.

Gold breaks above key resistance

Gold retained its safe-haven status around the NATO summit, where Biden wants to increase troops along the Eastern front and send an official waring against the use of Chemical weapons by Russia. Clearly this will irk Putin and only increase tensions between Russia and the West.

Gold saw a decent break above 1950 resistance yesterday on rising volume. It now trades within a bullish channel on the hourly chart, although now within a retracement phase. From here we would like to see support found somewhere around 1950 (previous resistance), the lower trendline or the 20-hour eMA before seeking fresh bullish opportunities. 1980 remains the target but keep in mind that, if it is not achieved today the weekly pivot point will be recalculated for next week so levels may need to be adjusted.

Up Next (Times in AEDT)

How to trade with City Index

You can easily trade with City Index by using these four easy steps:

Open an account, or log in if you’re already a customer

• Open an account in the UK
• Open an account in Australia
• Open an account in Singapore
Search for the company you want to trade in our award-winning platform
Choose your position and size, and your stop and limit levels
Place the trade

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.