AAFX TRADING

Daily Market Lookup

  • The dollar was down on Friday morning in Asia, after earlier gains were reversed over lingering doubts about the latest U.S. stimulus package. Meanwhile, the Chinese yuan was boosted by the inclusion of Chinese debt to FTSE Russell’s World Government Bond (WGBI) index. U.S. markets rose on Thursday over increased hopes that the U.S. Congress would break a months-long impasse to pass the latest COVID-19 stimulus measures. Democrats in the U.S. House of Representatives announced that they are working on a $2.2 trillion COVID-19 stimulus package that could be voted on next week. There is also a suggestion that House of Representatives Speaker Nancy Pelosi and U.S. Treasury Secretary Steven Mnuchin could resume stalled stimulus talks. But some investors remained skeptical on whether Congress will overcome the impasse. U.S. President Donald Trump refused to commit to a peaceful transfer of power should he fail to be re-elected in November’s presidential elections, increasing the chances of a disputed election. Meanwhile, data released on Thursday showed that the number of Americans claiming unemployment over the past week increased to 870,000, indicating a slowdown in the economic recovery and highlighting the pressing need for Congress to pass the support measures.
  • The U.S. dollar dipped from a two-month peak early on Friday as renewed hopes of U.S. stimulus eased investors' concerns about economic recovery, while the Chinese yuan gained after the country was added to a global bond benchmark. Currencies and stocks reversed direction, with U.S. equities gaining as traders latched on to hopes that stalled stimulus talks could resume between House of Representatives Speaker Nancy Pelosi, a Democrat and U.S. Treasury Secretary Steven Mnuchin Democrats in the U.S. House of Representatives are working on a $2.2 trillion coronavirus stimulus package that could be voted on next week. The move came after the latest data showed the number of Americans filing new claims for unemployment benefits unexpectedly increased last week in a sign the economic recovery was running out of steam. Many market players were cautious, however, as there remain doubts over whether the U.S. can overcome divisions to agree on a package. U.S. political uncertainties are also keeping many investors on edge,with a disputed election becoming more likely after U.S. President Donald Trump refused to commit to a peaceful transfer of power if he lost the election. The British pound managed to stay above Wednesday's two-month lows after Britain's government launched scaled-back job support for workers hit by a resurgent COVID-19 pandemic. The Turkish lira maintained its firm tone following a jump from Thursday's record low after the country's central bank unexpectedly hiked interest rates by 200 basis points.
  • Oil prices rose on Friday but are on track for a weekly fall because of rising concerns about the global resurgence of coronavirus infections and its effects on fuel demand, while the likely return of exports from Libya will add to supply. Brent is heading for a drop of around 2.5% this week with U.S. crude on track for a decline of about 1.5%. Both benchmarks are also heading for a monthly decline, which would be the first for Brent in six months. An oil tanker was loading a cargo on Thursday from one of three Libyan terminals that were reopened in recent days and more cargoes are expected to be lifted in the coming days. In the United States, which has the highest death toll from the coronavirus pandemic and is the world's biggest oil consumer, unemployment claims unexpectedly rose last week suggesting an economic recovery is flailing and pushing down fuel demand. U.S. fuel demand remains in the doldrums as the pandemic constrains travel. The four-week average of gasoline demand last week was 9% below a year earlier, government data showed on Wednesday. In other parts of the world, daily increases of coronavirus infections are hitting records and new restrictions are being put in place that will likely limit travel and fuel demand. In India, throughput by crude oil refiners in August fell 26.4% from a year ago, the most in four months, as fuel demand ebbed because surging coronavirus cases hindered industrial and transport activity. In the U.S., uncertainty over the fate of a COVID-19 stimulus bill played its part in dampening investors’ enthusiasm, as did President Donald Trump’s refusal to commit to a peaceful transition of power should he lose the upcoming election. An unexpected rise in U.S. unemployment claims were also a factor in keeping expectations low. Another headwind for oil prices comes with Libyan refineries starting to ship oil from refineries that had been blockaded for several months. The rise of COVID-19 cases in Europe is giving cause for concern, with several major economies introducing stiffer measures to constrain the spread of the virus. However, in Germany, the E.U.’s powerhouse, the ifo Business Climate Index rose to 93.4 in September as businesses take a more positive stance on their future prospects. Although up from August's 92.5 figure, the reading was lower that the 93.8 in forecasts prepared by Investing,com.

 

 
Intraday RESISTANCE LEVELS
25th September 2020 R1 R2 R3
GOLD-XAU 1,869 1,882 1889-1,900
Silver-XAG 23.30-24.00 24.50 25.20-25.90
Crude Oil 40.60-41.10 41.60 42.55-43.25
EURO/USD 1.1690-1.1730 1.1800 1.1860-1.1900
GBP/USD 1.2820-1.2900 1.2940 1.3000-1.3050
USD/JPY 105.50-104.90 106.10 106.90-107.30

Intraday SUPPORTS LEVELS
25th September 2020 S1 S2 S3
GOLD-XAU 1,862-1,850 1,842 1,820-1,809
Silver-XAG 22.90-22.20 21.65 21.00-19.50
Crude Oil 39.40-39.00 38.40 37.50-36.40
EURO/USD 1.1635 1.1570 1.1500-1.1460
GBP/USD 1.2725-1.2650 1.2600 1.2510-1.2450
USD/JPY 104.30-103.90 103.50 103.10-102.50

Intra-Day Strategy (25th 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 Thursday made its intraday high of US$1877.03/oz and low of US$1848.75/oz. Gold up 0.201% at US$1866.83/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 1862-1810 with risk below 1810, targeting 1869-1882 and 1889-1900. Sell below 1869-1924 keeping stop loss closing above 1924, targeting 1850-1842-1820 and 1809-1791.

 
Intraday Support Levels
S1     1,862-1,850
S2     1,842
S3     1,820-1,809
Intraday Resistance Levels
R1     1,869
R2     1,882
R3     1889-1,900

Technical Indicators

Name   Value Action
14DRSI  

35.576

Buy
20-DMA   1929.85 Buy
50-DMA  

1941.38

Buy
100-DMA   1844.77 Buy
200-DMA   1723.15 Buy
STOCH(5,3)   13.503 Buy
MACD(12,26,9)   14.45 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$23.34/oz and low of US$21.64/oz settled up by 1.715% at US$23.12/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 21.65-18.50 targeting 22.20-22.90-24.00 and 24.50-25.10, stop breakage below 18.50. Sell below 24.00-28.50 with stop loss above 28.50; targeting 23.30-22.90 and 22.20-21.50.

 
Intraday  Support Levels
S1     22.90-22.20
S2     21.65
S3     21.00-19.50

Intraday  Resistance Levels
R1     23.30-24.00
R2     24.50
R3     25.20-25.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   33.681 Buy
20-DMA   26.82 Buy
50-DMA   25.61 Buy
100-DMA   21.51 Buy
200-DMA   19.00 Buy
STOCH(5,3)   19.268 Buy
MACD(12,26,9)   1.914 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US40.40/bbl, intraday low of US$39.16/bbl and settled up by 1.286% to close at US$40.15/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 39.40-36.50 with risk daily closing below 36.50 and targeting 40.60-41.60-42.00 and 42.55-43.25-44.00. Sell in between 40.60-44.00 with stop loss at 44.00; targeting 41.10-40.60-39.50 and 39.00-38.55-37.10.

 
Intraday Support Levels
S1     39.40-39.00
S2     38.40
S3     37.50-36.40

Intraday Resistance Levels
R1     40.60-41.10
R2     41.60
R3     42.55-43.25

TECHNICAL INDICATORS
Name   Value Action
14DRSI   23.194 Sell
20-DMA   40.24 Sell
50-DMA   41.14 Sell
100-DMA   38.43 Buy
200-DMA   40.44 Sell
STOCH(5,3)   60.130 Sell
MACD(12,26,9)   0.738 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday an intraday low of US$1.1625/EUR, high of US$1.1686/EUR and settled the day down by 0.075% to close at US$1.1667/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 1.1635-1.1460 with risk below 1.1460, targeting 1.1690-1.1730-1.1800 and 1.1900-1.1955. Sell below 1.1690-1.2000 targeting 1.1635-1.1570 and 1.1500-1.1460 with stop-loss at daily closing above 1.2050.

 
Intraday Support Levels
S1     1.1635
S2     1.1570
S3     1.1500-1.1460

Intraday  Resistance Levels
R1     1.1690-1.1730
R2     1.1800
R3     1.1860-1.1900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.032 Buy
20-DMA   1.1841 Buy
50-DMA   1.1755 Buy
100-DMA   1.1436 Buy
200-DMA   1.1220 Buy
STOCH(5,3)   55.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2689/GBP, high of US$1.2780/GBP and settled the day down by 0.150% to close at US$1.2740/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 1.2820-1.3270 with targets at 1.2735-1.2650-1.2600 and 1.2510-1.2450 stop-loss should be 1.3270. Buy above 1.2735-1.2450 with targets 1.2820-1.2900-1.3000 and 1.3050-1.3100-1.3210 with stop loss closing below 1.3000.

 
Intraday Support Levels
S1     1.2725-1.2650
S2     1.2600
S3     1.2510-1.2450

Intraday Resistance Levels
R1     1.2820-1.2900
R2     1.2940
R3     1.3000-1.3050

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

43.904

Buy
20-DMA   1.3180 Sell
50-DMA   1.2911 Buy
100-DMA   1.2661 Buy
200-DMA   1.2734 Buy
STOCH(5,3)   17.940 Buy
MACD(12,26,9)   0.0124 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY105.19/USD and made an intraday high of JPY105.52/USD and settled the day up by 0.040% at JPY105.39/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 105.00-108.00 with risk above 108.00 targeting 104.50-103.90-103.50 and 103.10-102.50. 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     104.30-103.90
S2     103.50
S3     103.10-102.50

INTRADAY RESISTANCE LEVELS
R1     105.50-104.90
R2     106.10
R3     106.90-107.30

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

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