AAFX TRADING

Daily Market Lookup

  • The dollar traded higher in early European trade Tuesday, with sterling nursing losses as uncertainty over the likelihood of a post-Brexit trade deal grows. Fresh negotiations between the EU and the U.K. over a potential trade deal are set to start again later Tuesday, but the U.K. lit the touchpaper over the weekend by threatening to undermine the exit agreement unless free trade terms are agreed by next month. Talks have been at an impasse for months over two key issues - state aid and fisheries. U.K.-focused equity funds saw record outflows of 1.2 billion pounds ($1.58 billion) over the past three months as investors worry about a no-deal Brexit and the impact of the coronavirus pandemic, data from fund network Calastone showed on Tuesday. Additionally, EUR/USD dropped 0.1% to 1.1813 as investors look ahead to the European Central Bank’s policy meeting later this week amid growing expectation of a dovish message. Most analysts don't expect a change in the central bank's policy stance, but are looking to the message on its inflation forecasts and whether it seems concerned by the euro's strength - especially after the single currency posted a two-year high just above $1.20 at the beginning of the month. Japan's economy shrank an annualised 28.1% in the second quarter, more than a preliminary reading of a 27.8% contraction. Additionally, Yoshihide Suga, the frontrunner to succeed incumbent Shinzo Abe as prime minister in leadership elections scheduled for the following week, has hinted at snap elections.
  • The dollar held steady on Tuesday as investors weighed whether an accommodative turn from the European Central Bank later this week could hit the euro, while the pound nursed losses due to Brexit uncertainty. The main focus this week is on the European Central Bank's policy decision on Thursday. Most analysts don't expect a change in the central bank's policy stance but are looking to the message on its inflation forecasts and whether it seems concerned by the euro's strength. The meeting comes after the single currency marked a two-year high just above $1.20 at the beginning of the month, until comments about its level from ECB chief economist Philip Lane knocked it lower. The British pound , meanwhile, was the laggard amid a fresh crisis in EU-UK trade negotiations. A Financial Times report suggesting Britain might legislate to override its Brexit withdrawal agreement prompted the EU to warn there would be no deal if that happened, raising the prospect again of a hard Brexit. New talks are due to begin in London later on Tuesday. Final European GDP figures are due later in the day. U.K. Prime Minister Boris Johnson is reportedly contemplating legislation to override the country’s Brexit withdrawal agreement with the European Union (EU). The news triggered an EU warning that there would be no deal if the U.K. went ahead with the move, increasing the prospects of a hard Brexit yet again. Fresh talks between the U.K and the EU will be held later in the day.
  • Oil prices fell on Tuesday amid concerns over fuel demand as the peak U.S. driving season drew to a close and the U.S. Labor Day long weekend added to worries over rising coronavirus cases in more U.S. states. Coronavirus cases rose in 22 of the 50 U.S. states, a Reuters analysis showed, on the holiday weekend traditionally filled with gatherings to mark the end of summer. At the same time cases are flaring up in India and Britain. Brent dropped on Monday after Saudi Arabia's Aramco (SE:2222), the world's top oil exporter, cut the October official selling prices for its Arab light crude, seen as a sign demand growth may be stuttering as COVID-19 cases flare up around the world. Also weighing on the market is the upcoming maintenance season for U.S. refineries, which could cut crude demand by 1.5 million to 2 million barrels per day, he said. WTI and Brent have dropped out of the ranges they were in throughout August, with WTI now below $40 after having traded around $42 for most of the month. Brent has dropped from around $45. The market had been helped by a weaker U.S. dollar, which has since rebounded slightly. A stronger dollar also weighed broadly on commodities as this makes the greenback-priced oil more expensive to global buyers A day after thin holiday trade, the greenback was slightly stronger against a basket of currencies and firmed marginally against the euro. Oil was down on Tuesday morning in Asia, with fuel demand worries persisting as the Labor Day holiday in the U.S. marks the end of the peak driving season. The upcoming maintenance seasons for U.S. refineries could also cut crude demand by 1.5 million to 2 million barrels per day, he added. India, 22 U.S. states and the U.K. recently reported an uptick in cases. The total number of global cases topped 27.2 million as of September 8, according to Johns Hopkins University data. Meanwhile, Saudi Aramco (SE:2222) slashed the October official selling prices for its Arab light crude on Monday, indicating the Saudi giant’s doubt over demand growth as COVID-19 continues its worldwide rampage. Investors now await data on crude oil supply from the American Petroleum Institute (API), due later in the day.

 

 
Intraday RESISTANCE LEVELS
8th September 2020 R1 R2 R3
GOLD-XAU 1,940-1,954 1,971 1,989-2,010
Silver-XAG 27.00-28.10 29.00 29.80-30.50
Crude Oil 39.50-40.60 41.00 42.00-43.15
EURO/USD 1.1850-1.1900 1.1955 1.2000-1.2050
GBP/USD 1.3180-1.3210 1.3290 1.3350-1.3420
USD/JPY 106.90 107.30 108.10-108.90

Intraday SUPPORTS LEVELS
8th September 2020 S1 S2 S3
GOLD-XAU 1,924-1,915 1,900 1,889-1,880
Silver-XAG 26.55-26.10 25.10 24.50-23.70
Crude Oil 39.00-38.55 37.10 36.40-36.00
EURO/USD 1.1800-1.1730 1.1690 1.1635-1.1600
GBP/USD 1.3100-1.3050 1.3000 1.2940-1.2900
USD/JPY 106.10-105.50 104.90 104.30-103.90

Intra-Day Strategy (8th September 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 Monday made its intraday high of US$1941.33/oz and low of US$1924.40/oz. Gold down 0.091% at US$1928.01/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1882) and breakage below will call for 1805. 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 overbought territory and giving positive crossover to bullish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1924-1870 with risk below 1870, targeting 1940-1954-1971 and 1989-2010-2023. Sell below 1940-2010 keeping stop loss closing above 2010, targeting 1924-1900-1889.

 
Intraday Support Levels
S1     1,924-1,915
S2     1,900
S3     1,889-1,880
Intraday Resistance Levels
R1     1,940-1,954
R2     1,971
R3     1,989-2,010

Technical Indicators

Name   Value Action
14DRSI  

58.043

Buy
20-DMA   1966.45 Buy
50-DMA  

1882.25

Buy
100-DMA   1805.63 Buy
200-DMA   1682.51 Buy
STOCH(5,3)   88.503 Buy
MACD(12,26,9)   15.45 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$27.15/oz and low of US$26.61/oz settled down by 0.193% at US$26.80/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 26.55-24.00 targeting 27.00-28.10-29.00 and 29.80-30.50-31.00, stop breakage below 22.50. Sell below 27.00-30.50 with stop loss above 30.50; targeting 26.55-26.10 and 25.00-24.30.

 
Intraday  Support Levels
S1     26.55-26.10
S2     25.10
S3     24.50-23.70

Intraday  Resistance Levels
R1     27.00-28.10
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 Monday made an intra‐day high of US39.75/bbl, intraday low of US$38.77/bbl and settled down by 0.778% to close at US$39.38/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 41.15-38.50 with risk daily closing below 36.65 and targeting 42.00-43.15-44.10 and 45.00-46.30-47.00. Sell in between 42.10-47.30 with stop loss at 47.30; targeting 42.00-43.15-42.00-41.00 and 40.60-39.50-38.50.

 
Intraday Support Levels
S1     39.00-38.55
S2     37.10
S3     36.40-36.00

Intraday Resistance Levels
R1     39.50-40.60
R2     41.00
R3     42.00-43.15

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.099 Sell
20-DMA   42.14 Buy
50-DMA   41.02 Buy
100-DMA   34.96 Buy
200-DMA   42.11 Sell
STOCH(5,3)   78.130 Buy
MACD(12,26,9)   0.738 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.1810/EUR, high of US$1.1847/EUR and settled the day down by 0.257% to close at US$1.1814/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 1.1800-1.1600 with risk below 1.1600, targeting 1.1850-1.1900-1.1955 and 1.2050-1.2100-1.2170. Sell below 1.1850-1.2250 targeting 1.1800-1.1730-1.1690 and 1.1635-1.1600 with stop-loss at daily closing above 1.2250.

 
Intraday Support Levels
S1     1.1800-1.1730
S2     1.1690
S3     1.1635-1.1600

Intraday  Resistance Levels
R1     1.1850-1.1900
R2     1.1955
R3     1.2000-1.2050

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.032 Buy
20-DMA   1.1834 Buy
50-DMA   1.1631 Buy
100-DMA   1.1329 Buy
200-DMA   1.1178 Buy
STOCH(5,3)   38.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3139/GBP, high of US$1.3269/GBP and settled the day down by 0.631% to close at US$1.3161/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.3134) is become immediate support 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 1.3180-1.3550 with targets at 1.3100-1.3050-1.3000 and 1.2940-1.2900 stop-loss should be 1.3550. Buy above 1.3100-1.2900 with targets 1.3180-1.3210-1.3290 and 1.3350-1.3420-1.3490 with stop loss closing below 1.3000.

 
Intraday Support Levels
S1     1.3100-1.3050
S2     1.3000
S3     1.2940-1.2900

Intraday Resistance Levels
R1     1.3180-1.3210
R2     1.3290
R3     1.3350-1.3420

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

59.904

Buy
20-DMA   1.3183 Buy
50-DMA   1.2911 Buy
100-DMA   1.2661 Sell
200-DMA   1.2734 Sell
STOCH(5,3)   36.940 Buy
MACD(12,26,9)   0.0124 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY106.12/USD and made an intraday high of JPY106.38/USD and settled the day down by 0.0235% at JPY106.22/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 106.50-111.00 with risk above 111.00 targeting 106.10-105.50-104.90 and 104.50-103.90-103.10. Long positions above 106.50-103.00 with targets of 106.90-107.50 and 107.90-108.40-109.40 with stop below 105.00.

 
Intraday Support Levels
S1     106.10-105.50
S2     104.90
S3     104.30-103.90

INTRADAY RESISTANCE LEVELS
R1     106.90
R2     107.30
R3     108.10-108.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.904 Buy
20-DMA   106.08 Sell
50-DMA   106.46 Sell
100-DMA   106.92 Sell
200-DMA   107.92 Sell
STOCH(9,6)   46.253 Sell
MACD(12,26,9)   -0.099 Sell

AAFX TRADING
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