AAFX TRADING

Daily Market Lookup

  • The dollar edged lower in early European trade Friday, with volumes hit by the U.S. holiday and traders weighing the conflicting influences of positive economic data and the increasing number of coronavirus cases. Economic data released earlier Friday pointed to a brisk pickup in the Chinese service sector, with the Caixin Services Purchasing Managers Index coming in at 58.4 in June, the highest reading in two months. This helped USD/CNY drop 0.1% to 7.0606. With the U.S. recording Thursday an addition of 4.8 million jobs in June and manufacturing activity rebounding more than expected, the economic signs suggest that the vast sums of money injected by the monetary and fiscal authorities around the world are bearing fruit. Even so, another spike in coronavirus infections threatens to put the brakes on economic activity once again. The U.S. recorded more than 52,000 new cases on Thursday, just under its daily record, with Florida alone accounting for over 10,000 of them. U.S. Accounts for around a quarter of the 10.8 million coronavirus cases recorded worldwide. More than three dozen U.S. states have seen increases in Covid-19 cases as of Thursday, prompting them to delay and in some cases reverse plans to let stores reopen and activities resume. The Fed's balance shrunk for a second week in a row last week as the volume of cross-currency swaps with other central banks, a feature of the early stage of the Covid crisis, was wound down further. The dollar was down but not out on Friday morning in Asia, with investors retreating from the greenback after positive data from both China and the U.S. gave market sentiment an end-of-week boost. Non-farm payrolls rose to 4.8 million in June, higher than the 3 million in analyst forecasts prepared by Investing.com as well as May’s figure of 2.699 mn. But rising COVID-19 figures globally, and particularly in the U.S., stemmed the safe-haven asset’s losses. The number of global cases topped 10.8 mn as of July 3, according to Johns Hopkins University data. But the yuan’s gains were muted by rising tensions between China and the U.S. over the national security laws in Hong Kong. The U.S. Senate on Thursday approved sanctions against Chinese entities involved with implementing the law, and the legislation is now on U.S. President Donald Trump’s desk for his approval or veto.
  • Asian shares rallied to a four-month high on Friday on robust U.S. payrolls data and a brisk pickup in Chinese service sector activity, but a surge in coronavirus cases in the United States kept a lid on stronger gains. Mainland Chinese shares, which were among the best performers over the past month, extended gains, with the Shanghai composite index hitting a high last seen in April 2019. China’s services sector expanded at the fastest pace in over a decade in June, the Caixin/Markit services Purchasing Managers’ Index (PMI) showed, as the easing of coronavirus-related lockdown measures revived consumer demand. Factory surveys earlier in the week had also shown momentum in China is building, though companies are still shedding job. The country’s nonfarm payrolls surged by 4.8 million jobs in June, above the average forecast of 3 million jobs in June, thanks to rises in the hard-hit hospitality sectors. Even after two months of recovery from May, the U.S. economy has recovered only just over a third of a historic plunge of 20.787 million jobs in April. A separate report on jobless claims, the most timely data on employment, showed the number of people receiving benefits after an initial week of aid actually rose 59,000 to 19.290 million in the week ending June 20. The recovery also faces more headwinds as a surge of new coronavirus infections prompts U.S. states to delay and in some cases reverse plans to let stores reopen and activities resume. More than three dozen U.S. states saw increases in COVID-19 cases, with cases in Florida spiking above 10,000. On the other hand, expanded unemployment benefits to support those who lost their jobs due to the pandemic are due to expire at the end of this month, though many investors think Congress could extend the measure. The U.S. State Department warned top American companies including Walmart, Apple and Amazon.com Inc over risks faced from maintaining supply chains associated with human rights abuses in China’s western Xinjiang province.
  • Oil prices fell on Friday, reversing earlier gains, as the resurgence of the coronavirus globally and in the United States, the world's largest oil consumer, stoked worries that a fuel demand recovery could stall. Both benchmarks rose more than 2% on Thursday, buoyed by stronger-than-expected U.S. jobs data and a fall in U.S. crude inventories. For the week, Brent is up 4.3% and WTI is up 4.7%. Increases in the daily cases of the coronavirus, however, globally and in the United States pressured prices. New U.S. COVID-19 cases rose by more than 50,000 on Thursday, setting a record for a third consecutive day, according to a Reuters tally. Should the number of coronavirus cases continue to grow and increase the need to take stronger measures to stem the spread of the virus, the weakened growth implications of such policies could weigh on crude oil prices, Zabelin said. Gasoline demand will be closely watched as the United States heads into its July 4 holiday weekend when many Americans are expected to hit the road U.S. gasoline stocks rose by 1.2 million barrels in the week to June 26, according to data from the Energy Information Administration released on Wednesday.

 

 
Intraday RESISTANCE LEVELS
3rd July 2020 R1 R2 R3
GOLD-XAU 1,780-1,789 1,800 1,810-1,820
Silver-XAG 18.55 18.95 19.60-20.10
Crude Oil 40.60 41.20 42.00-43.40
EURO/USD 1.1300-1.1360 1.1400 1.1450-1.1500
GBP/USD 1.2490-1.2550 1.2600 1.2680-1.2760
USD/JPY 107.90 108.40 109.40-110.20

Intraday SUPPORTS LEVELS
3rd July 2020 S1 S2 S3
GOLD-XAU 1,760-1,754 1,748 1,740-1,727
Silver-XAG 18.00-17.50 17.25 ¬16.90-16.30
Crude Oil 39.50-38.50 37.60 37.10-36.50
EURO/USD .1250-1.1205 1.1150 1.1090-1.1030
GBP/USD 1.2410-1.2320 1.2250 1.2165-1.2100
USD/JPY 107.50-106.50 105.50 105.00-104.30

Intra-Day Strategy (3rd July 2020)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Buy
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Thursday made its intraday high of US$1779.45/oz and low of US$1757.39/oz. Gold up 0.212% at US$1772.90/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1642) and breakage below will call for 1600. MACD is above zero line and histograms are also increasing trend and it will bring upward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving negative crossover to bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1770-1727 with risk below 1720, targeting 1780-1790-1805 and 1810-1820-1830. Sell below 1780-1830 keeping stop loss closing above 1830, targeting 1760-1754-1748 and 1,740-1,727.

 
Intraday Support Levels
S1     1,760-1,754
S2     1,748
S3     1,740-1,727
Intraday Resistance Levels
R1     1,780-1,789
R2     1,800
R3     1,810-1,820

Technical Indicators

Name   Value Action
14DRSI  

60.982

Buy
20-DMA   1741.84 Sell
50-DMA  

1726.66

Sell
100-DMA   1675.57 Buy
200-DMA   1591.57 Buy
STOCH(5,3)   61.503 Sell
MACD(12,26,9)   15.894 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$18.12/oz and low of US$17.75/oz settled down by 0.272% at US$17.92/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 200DMA (16.93), breakage below will lead to 16.30. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is approaching overbought 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 17.50-15.55 targeting 18.00-18.40-18.95 and 19.60-20.10; stop breakage below 15.00. Sell below 18.00-20.10 with stop loss above 20.10; targeting 17.50-17.25-16.90 and 16.50-16.10-15.80.

 
Intraday  Support Levels
S1     18.00-17.50
S2     17.25
S3     ¬16.90-16.30

Intraday  Resistance Levels
R1     18.55
R2     18.95
R3     19.60-20.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.514 Buy
20-DMA   17.67 Buy
50-DMA   16.85 Buy
100-DMA   16.26 Buy
200-DMA   16.87 Buy
STOCH(5,3)   64.268 Sell
MACD(12,26,9)   0.263 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US40.75/bbl, intraday low of US$39.48/bbl and settled down by 1.207% to close at US$40.22/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 40.00 which is a resistance level and breakage above will call for 44.00. MACD is below zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving positive crossover for confirmation of bullish stance; while the RSI is in neutral region and more downside can be expected to reach the oversold region, which is highly probable.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy above 39.10-34.00 with risk daily closing below 34.00 and targeting 39.50-40.60 and 41.20-42.00-43.40. Sell in between 39.50-43.40 with stop loss at 43.40; targeting 38.00-37.10-36.00 and 34.90-33.90-33.00.

 
Intraday Support Levels
S1     39.50-38.50
S2     37.60
S3     37.10-36.50

Intraday Resistance Levels
R1     40.60
R2     41.20
R3     42.00-43.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   61.870 Sell
20-DMA   38.40 Buy
50-DMA   31.45 Buy
100-DMA   33.32 Buy
200-DMA   44.94 Sell
STOCH(5,3)   48.130 Buy
MACD(12,26,9)   1.819 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday an intraday low of US$1.1222/EUR, high of US$1.1302/EUR and settled the day down by 0.103% to close at US$1.1238/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1031), which become immediate resistance level, break above will target 1.1090. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in oversold 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 right now.

Trading Strategy: Neutral to Buy

Buy above 1.1250-1.1030 with risk below 1.1030, targeting 1.1300-1.1360-1.1400 and 1.1450-1.1495. Sell below 1.1300-1.1495 targeting 1.1235-1.1190-1.1150 and 1.1090-1.1020 with stop-loss at daily closing above 1.1500.

 
Intraday Support Levels
S1     .1250-1.1205
S2     1.1150
S3     1.1090-1.1030

Intraday  Resistance Levels
R1     1.1300-1.1360
R2     1.1400
R3     1.1450-1.1500

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.032 Buy
20-DMA   1.1187 Buy
50-DMA   1.0996 Buy
100-DMA   1.0984 Sell
200-DMA   1.1025 Sell
STOCH(5,3)   23.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2455/GBP, high of US$1.2529/GBP and settled the day down by 0.0529% to close at US$1.2466/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.2647) is become major resistance 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 negative crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.2490-1.2760 with targets at 1.2410-1.2320-1.2250 and 1.2165-1.2100-1.2050 stop-loss should be 1.2900. Buy above 1.2410-1.2100 with targets 1.2490-1.2550-1.2650 and 1.2700-1.2760 with stop loss closing below 1.2100.

 
Intraday Support Levels
S1     1.2410-1.2320
S2     1.2250
S3     1.2165-1.2100

Intraday Resistance Levels
R1     1.2490-1.2550
R2     1.2600
R3     1.2680-1.2760

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

46.554

Buy
20-DMA   1.2517 Buy
50-DMA   1.2413 Buy
100-DMA   1.2462 Sell
200-DMA   1.2680 Sell
STOCH(5,3)   42.940 Sell
MACD(12,26,9)   0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY107.32/USD and made an intraday high of JPY107.71/USD and settled the day up by 0.0297% at JPY107.49/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (108.30), 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 neutral territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 107.90-111.00 with risk above 111.00 targeting 107.50-106.50-105.60 and 105.00-104.50. Long positions above 107.50-104.00 with targets of 107.90-108.40 and 109.40-110.20 with stop below 105.00.

 
Intraday Support Levels
S1     107.50-106.50
S2     105.50
S3     105.00-104.30

INTRADAY RESISTANCE LEVELS
R1     107.90
R2     108.40
R3     109.40-110.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.904 Buy
20-DMA   107.58 Buy
50-DMA   107.37 Sell
100-DMA   107.90 Sell
200-DMA   108.37 Buy
STOCH(9,6)   82.253 Sell
MACD(12,26,9)   -0.1448 Sell

AAFX TRADING
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