Asian stocks edged higher on low volume after S&P ended higher on Friday.Today’s focus will be on Japan's central bank, which is expected to expand monetary stimulus for the second straight month to ease corporate funding strains and finance huge government spending. The central bank is said to follow suit to join the Fed and ECB to buy unlimited amounts of government bonds at an annual pace of 80 trillion yen ($744 billion) per year, according to sources. Further this week ahead, the Fed and ECB will also hold rate meetings where their attitude about the economy will draw the market's attention. 

 

The dollar went lower as risk aversion eased, benefiting from good news from the virus front. Market speculation is that the COVIC-19 might have peaked with the death toll slowing by the most in more than a month in Spain, Italy and France. Itay will ease its lockdown in just over a week, while New York also outlined its reopening plans. Meanwhile, in Australia, two states have eased COVIC-19 restrictions. These could bring back the risk-on sentiment and boost risk assets. Gold also went lower upon the bullish risk sentiment, but weaker USD could provide some near-term support for gold price.

 

Oil dropped again on Monday morning below $16 a barrel as inventories went higher. The magnitude of excess supply is visible in two key indicators. Developed countries have about 80 days of oil stocked with them, up 33 per cent from the normal of two months. Second, a whopping 100 million barrels of oil was present in the sea and ports (in-transit) at the end of March 2020, 50 per cent more than what it was six months ago, and possibly the highest ever. It is reported that the Singapore coastline is packed with ships full of oil that nobody wants. About 60 clean fuel tankers are currently anchored along the busy strait, up from the usual 30-40 ships. 

 

Copper edged higher at the start of the week, buoyed by the bullish sentiment from the COVC-19 front. The metal shrugged off the hard facts that China’s imports of copper shrank. Imports of copper concentrate from Peru into China tumbled 28.1% to 397,922 tonnes in March, compared with the same month of last year, official data showed on Sunday, amid restrictions to contain the coronavirus pandemic in the South American nation. But investors are more optimistic about the pick up of manufacturing in China, as the ease of restrictions across the globe could lead to a demand recovery for China’s manufacturing sectors. 

Technical & Trade views

 

USDCAD (Intraday bias: bearish below 1.4135)

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We remain bearish as price is approaching 1st resistance, which happens to be where the 50% fibonacci retracement is, and price is likely to reverse off 1st resistance towards 1st support.. 

 

UKOIL (Intraday bias: bullish above 21.74 neutral below)

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We are waiting for the price to break above upside confirmation, which happens to be a confluence level of the horizontal overlap resistance and 38.2% Fibonacci retracement. If price can break above the upside confirmation, more upside is available.

 

XAUUSD ( Intraday bias: bearish below 1718.42) 

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We remain neutral waiting for the price to break below the downside confirmation at 1718.42  where the 61.8% fibonacci retracement and horizontal overlap resistance are. If price could break below the downside confirmation, price is likely to drop towards 1st support at 1642.36  where the 38.2% fibonacci retracement and horizontal overlap support are.

 

XCUUSD ( Intraday bias: bullish above 2.3514)

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We remain bullish as  price is likely to approach 1st support, which happens to be a confluence level of the 50% fibonacci retracement  and horizontal overlap support. Price is likely to go higher towards 1st resistance at 2.3514 where the previous swing high is.