AAFX TRADING

Daily Market Lookup

  • The dollar edged lower in early European trade Friday, with attention still focused upon the lack of a new relief package to help the U.S. economy recover from the damage caused by the coronavirus outbreak. The U.S. said on Thursday that the number of unemployment claims over the past week dipped below the one million mark for the first time since the COVID-19 outbreak. But the news was overshadowed by the grim reality that more than 30 million Americans are out of work, as well as the suspension of negotiations over the latest U.S. stimulus measures as the Senate wrapped up its session on Thursday. This suggests that the fight for a new package is likely to drag until September, drawing dangerously close to the period when Washington shuts down to fight the national election. At the same time the United States faces a "gruesome" fall with a further rise in coronavirus case numbers, a Yale School of Medicine epidemiologist told Politico Thursday. The U.S. retail sales release, at 8:30 AM ET (1230 GMT), will be of interest, with the numbers expected to have increased in July, though nowhere near the May and June jumps. Oxford Economics noted, in a tweet, that its U.S. recovery tracker fell in the last week of July, with declines in demand, health, and mobility outweighed modest improvements in financial markets, production, and employment.
  • The dollar was down on Friday morning, giving up some earlier gains as doubts persist over the global economic recovery from COVID-19. Investor sentiment was dampened by disappointing Chinese data released earlier in the day that indicated continuous but slower recovery in industrial production, as well as a bigger-than-expected drop in retail sales. The data said that July’s industrial production rose 4.8% year-on-year but missed the 5.1% increase in forecasts prepared by Investing.com. Meanwhile, retail sales fell 1.1% in the same month, against the forecasted 0.1%. The unemployment rate remained unchanged at 5.7%. Investors will also be looking at the outcome of Saturday’s online meeting between U.S. and Chinese officials to discuss trade alongside other issues. The U.S. said on Thursday that the number of unemployment claims over the past week dipped below the one million mark for the first time since the COVID-19 outbreak. But the news was overshadowed by the grim reality that more than 30 million Americans are out of work, as well as the suspension of negotiations over the latest U.S. stimulus measures as the Senate wrapped up its session on Thursday. The dollar drifted higher on Friday, helped by strong U.S. jobs data as well as firmer global demand for safe-havens amid concerns about the coronavirus recovery, setting the currency up to potentially snap a seven-week losing streak. Soft Chinese retail and production figures cast a pall over the mood in Asia, dragging on the risk-sensitive Australian and New Zealand dollars. China's industrial output rose more slowly than expected in July and retail sales fell for a seventh straight month, suggesting some bumps in even the world's most promising rebound. Overnight the weekly number of applications for unemployment benefits in the United States dropped below one million for the first time since the start of the pandemic, with 963,000 claims coming in below expectations for 1.1 million. But beyond buoying the dollar any relief was shortlived, as some 30 million Americans are out of work and an aid package to keep stimulus flowing in the economy has stalled in Congress. On the data schedule later today are preliminary European employment and GDP numbers, as well as U.S. retail sales figures, with investors likely to focus on any signs of divergence between the U.S. and European recoveries.
  • Oil was up on Friday morning in Asia, ending the week with gains amid growing investor confidence in fuel demand recovery generally. Oil prices continue to be supported by indications of a slowdown in crude production. Data from both the American Petroleum Institute (API) and the U.S. Energy Information Administration (EIA) during the week showed draws in U.S. crude oil supplies. But some investors sounded a note of caution amid the optimism. The Organization of the Petroleum Exporting Countries (OPEC) also forecasted earlier in the week that world oil demand may drop by 9.06 million bpd this year, an increase from the 8.95 million bpd decline forecasted last month. Russian Energy Minister Alexander Novak warned on Thursday that he does not expect quick decisions on output cuts when the OPEC+ group monitoring committee meets next week. Oil headed for a second weekly gain as signs an energy demand recovery in the U.S. is gaining traction outweighed a more pessimistic report from the International Energy Agency. The agency’s steepest downgrades were for the second half of this year and it said the outlook for jet fuel consumption had worsened in the last few weeks as the coronavirus spread more widely. On a brighter note, the IEA said that world markets should tighten during the rest of the year as activity recovers and Saudi Arabia and other OPEC nations keep production in check. The OPEC+ producer bloc has delayed its Joint Ministerial Monitoring Committee by a day to Aug. 19 due to Russian Energy Minister Alexander Novak’s schedule, according to delegates. Novak said the market is stabilizing and there’s no need to ease OPEC+ output cuts ahead of time, Tass news agency reported.

 

 
Intraday RESISTANCE LEVELS
14th August 2020 R1 R2 R3
GOLD-XAU 1,954 1,966 1,981-1,989
Silver-XAG 27.00-27.90 29.00 29.80-30.50
Crude Oil 43.15 44.10 45.00-46.30
EURO/USD 1.1850 1.1900 1.1950-1.2000
GBP/USD 1.3100-1.3160 1.3210 1.3290-1.3350
USD/JPY 106.90-107.30 108.10 108.90-109.50

Intraday SUPPORTS LEVELS
14th August 2020 S1 S2 S3
GOLD-XAU 1,940-1920 1,900 1,890-1,870
Silver-XAG 26.10-26.55 25.10 24.30-23.35
Crude Oil 42.00-41.00 40.60 39.50-38.50
EURO/USD 1.1800-1.1730 1.1690 1.1650-1.5490
GBP/USD 1.3050-1.3015 1.2950 1.2900-1.2840
USD/JPY 106.50-105.50 104.90 104.30-103.90

Intra-Day Strategy (14th August 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$1966.21/oz and low of US$1912.43/oz. Gold up 1.951% at US$1952.23/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 1940-1862 with risk below 1860, targeting 1954-1966-1981 and 1989-2005. Sell below 1954-2005 keeping stop loss closing above 2005, targeting 1940-1954-1966 and 1981-2005.

 
Intraday Support Levels
S1     1,940-1920
S2     1,900
S3     1,890-1,870
Intraday Resistance Levels
R1     1,954
R2     1,966
R3     1,981-1,989

Technical Indicators

Name   Value Action
14DRSI  

52.098

Buy
20-DMA   1936.00 Buy
50-DMA  

1829.07

Buy
100-DMA   1761.32 Buy
200-DMA   1649.02 Buy
STOCH(5,3)   27.503 Buy
MACD(12,26,9)   47.94 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$27.70/oz and low of US$25.25/oz settled up by 7.38% at US$27.43/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 20DMA (21.60), breakage below will lead to 19.40. 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 neutral 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 26.10-22.50 targeting 27.00-27.90-29.00 and 29.80-30.50, stop breakage below 22.50. Sell below 27.00-30.00 with stop loss above 30.00; targeting 26.10-25.00-24.30 and 23.35-22.90-22.50.

 
Intraday  Support Levels
S1     26.10-26.55
S2     25.10
S3     24.30-23.35

Intraday  Resistance Levels
R1     27.00-27.90
R2     29.00
R3     29.80-30.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.514 Buy
20-DMA   24.90 Buy
50-DMA   20.81 Buy
100-DMA   18.30 Buy
200-DMA   17.66 Buy
STOCH(5,3)   49.268 Buy
MACD(12,26,9)   1.914 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US43.05/bbl, intraday low of US$42.31/bbl and settled down by 0.654% to close at US$42.47/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 42.00-38.50 with risk daily closing below 36.65 and targeting 43.10-44.10-45.00 and 46.30. Sell in between 43.00-46.30 with stop loss at 46.30; targeting 42.00-41.00-40.60 and 39.50-38.50.

 
Intraday Support Levels
S1     42.00-41.00
S2     40.60
S3     39.50-38.50

Intraday Resistance Levels
R1     43.15
R2     44.10
R3     45.00-46.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.099 Sell
20-DMA   41.06 Buy
50-DMA   39.57 Buy
100-DMA   32.50 Buy
200-DMA   43.09 Sell
STOCH(5,3)   62.130 Buy
MACD(12,26,9)   0.738 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.1710/EUR, high of US$1.1816/EUR and settled the day up by 0.375% to close at US$1.1783/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 1.1800-1.1540 with risk below 1.1540, targeting 1.1850-1.1900 and 1.1950-1.2000. Sell below 1.1800-1.2050 targeting 1.1800-1.1720-1.1650 and 1.1500-1.1450-1.1400 with stop-loss at daily closing above 1.1950.

 
Intraday Support Levels
S1     1.1800-1.1730
S2     1.1690
S3     1.1650-1.5490

Intraday  Resistance Levels
R1     1.1850
R2     1.1900
R3     1.1950-1.2000

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.032 Buy
20-DMA   1.1713 Buy
50-DMA   1.1456 Buy
100-DMA   1.1190 Buy
200-DMA   1.1169 Buy
STOCH(5,3)   36.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.30245/GBP, high of US$1.3124/GBP and settled the day up by 0.261% to close at US$1.3066/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 1.3100-1.3350 with targets at 1.3065-1.3015-1.2950 and 1.2870-1.2760-1.2680 stop-loss should be 1.3100. Buy above 1.3065-1.2840 with targets 1.3100-1.3160-1.3200 and 1.3290-1.3350 with stop loss closing below 1.2400.

 
Intraday Support Levels
S1     1.3050-1.3015
S2     1.2950
S3     1.2900-1.2840

Intraday Resistance Levels
R1     1.3100-1.3160
R2     1.3210
R3     1.3290-1.3350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

70.904

Buy
20-DMA   1.2871 Buy
50-DMA   1.2666 Buy
100-DMA   1.2501 Sell
200-DMA   1.2705 Sell
STOCH(5,3)   52.940 Sell
MACD(12,26,9)   0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY106.55/USD and made an intraday high of JPY107.04/USD and settled the day up by 0.112% at JPY106.91/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 106.00-111.00 with risk above 111.00 targeting 105.50-104.90-104.50 and 103.90-103.10. Long positions above 105.50-103.00 with targets of 106.00-106.50-106.90 and 107.90-108.40-109.40 with stop below 105.00.

 
Intraday Support Levels
S1     106.50-105.50
S2     104.90
S3     104.30-103.90

INTRADAY RESISTANCE LEVELS
R1     106.90-107.30
R2     108.10
R3     108.90-109.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.904 Buy
20-DMA   107.21 Sell
50-DMA   107.45 Sell
100-DMA   107.53 Sell
200-DMA   108.36 Sell
STOCH(9,6)   44.253 Sell
MACD(12,26,9)   -0.1448 Sell

AAFX TRADING
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