AAFX TRADING

Daily Market Lookup

  • The dollar bounced back from a three-week low on Tuesday as market players bought it back, particularly against riskier peers, after Chinese authorities appeared to be trying to put a brake on recent rises in the yuan. But overall risk sentiment was propped up by hope that former U.S. Vice President Joe Biden will beat President Donald Trump in the Nov. 3 U.S. election and push forward with a large stimulus to shore up a pandemic-hit economy. China's central bank announced on the weekend the removal of reserve requirements for some foreign exchange forwards, cementing speculation Beijing wants to curb the yuan's strength. A Biden victory is seen as negative for the dollar also partly because his pledge to increase corporate tax would reduce returns from investments in the United States, putting pressure on the dollar even against safe-have currencies such as the yen and the Swiss franc. Sterling traded above the key $1.30 level as hopes for a Brexit deal offset concern about pressure on the economy from new corona virus restrictions British Prime Minister Boris Johnson has announced. The dollar was up on Tuesday morning in Asia, despite edging closer to three-week lows and some investors stubbornly holding onto hopes of large U.S. stimulus measures to prop up the COVID-19 ravaged economy before the Nov. 3 presidential election. But other investors were skeptical that Republicans and Democrats would reach a consensus and pass the measures before the election, with Democrat Joe Biden continuing to widen his lead against President Donald Trump and a Biden victory expected to bring big stimulus measures. Should Biden triumph over Trump on November 3, his campaign pledge to raise corporate taxes is seen as negative for the greenback as it would reduce returns from investments in the U.S. Investors awaiting Chinese trade data, including exports, imports and the trade balance, due later in the day. The offshore yuan is still reeling from the impact of the People’s Bank of China’s removal of financial institutions’ reserve requirement ratio when conducting foreign exchange forwards trading. The move, an attempt to curb the recent appreciation in the yuan, also lowered the cost of shortening the currency. Hopes for a Brexit deal with the European Union, with only two days remaining until Prime Minister Boris Johnson’s self-imposed deadline of Oct.15, outweighed worries over Johnson’s new COVID-19 restrictions on Monday.
  • Oil prices were steady on Tuesday, sitting on losses of nearly 3% from the previous session as supplies began to resume in Norway, the U.S. Gulf of Mexico and Libya, while the IEA forecast a 5% fall in global energy demand in 2020. Oil prices are under pressure from concerns about the return of supplies, while resurgent COVID-19 infections in the U.S. Midwest and Europe raise worries about fuel demand growth, posing a challenge for the Organization of Petroleum Exporting Countries and its allies, together called OPEC+. With workers returning to U.S. Gulf of Mexico platforms after Hurricane Delta and Norwegian workers returning to rigs after ending a strike, all eyes were on Libya, a member of the OPEC, which on Sunday lifted force majeure at the Sharara oilfield. Libya's total output on Monday was at 355,000 bpd. The Sharara field was producing 300,000 bpd of oil before the blockade. OPEC+ has curbed supply to help shore up oil prices amid coronavirus pandemic, with cuts of 7.7 million barrels per day due to hold through December. The producers' market monitoring panel is due to meet next Monday. The International Energy Agency (IEA), which advises Western governments on energy policy, said in its newly released annual World Energy Outlook that in its central scenario, a vaccine and therapeutic could mean the global economy rebounds in 2021 and energy demand recovers by 2023. But under a "delayed recovery scenario", the timeline is pushed back two years, it said. Stoking worries about fuel demand, curbs were being tightened in Britain and the Czech Republic to battle rising cases of COVID-19, while French Prime Minister Jean Castex said he could not rule out local lockdowns. Oil was up on Tuesday morning in Asia, staging a slight recovery from the previous day’s 2.9% fall. However, oversupply issues continue to dog the market with ever-rising COVID_19 number continuing to slash global demand. Recent supply outages that have assisted oil prices are coming to an end, leading to the strong fall in the previous trading session. U.S. Gulf of Mexico rigs are coming back onstream after Hurricane Delta passed through the region late in the previous week. In Norway, an agreement has been reached between striking oil workers and management, ending a strike that had disrupted 8% of Norway’s output. The country’s 460K bpd Johan Sverdup field was due to have been shut down by strike action next week, the anticipation of which had helped sustain prices. A further oversupply factor is coming from Libya, where the Sharara field had its force majeure embargo lifted on Oct. 11. The field is expected to reach 300K bpd if it returns to pre-embargo levels, nearly doubling the North African OPEC member’s current output. OPEC+, a group formed of OPEC and its allies, is due hold a meeting of its market monitoring panel on Oct. 19. The group is expected to continue with the 7.7 bpd cuts it put in place earlier in the year, though many investors are anticipating these to be both extended and deepened Investors are looking to crude oil supply data from the American Petroleum Institute, due later on the next day.

 

 
Intraday RESISTANCE LEVELS
14th October 2020 R1 R2 R3
GOLD-XAU 1,934-1,944 1,955 1,968-1,980
Silver-XAG 25.30 26.05-26.80 27.50
Crude Oil 40.80-42.00 42.50 43.10-43.85
EURO/USD 1.1800-1.1860 1.1900 1.1950-1.2010
GBP/USD 1.3060-1.3100 1.3190 1.3270-1.3300
USD/JPY 105.50-105.90 106.90 107.60-108.00

Intraday SUPPORTS LEVELS
14th October 2020 S1 S2 S3
GOLD-XAU 1,916-1,900 1,890 1,882-1,869
Silver-XAG 24.50-24.00 23.30 22.90-22.20
Crude Oil 40.00-39.70 39.00 38.40-37.50
EURO/USD 1.1750-1.1690 1.1635 1.1570-1.1500
GBP/USD 1.3020-1.2940 1.2900 1.2820-1.2725
USD/JPY 104.90 104.30 103.90-103.10

Intra-Day Strategy (14th October 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$1933.16/oz and low of US$1918.12/oz. Gold up 0.347% at US$1921.96/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 1916-1810 with risk below 1810, targeting 1934-1944 and 1955-1964-1976. Sell below 1934-1980 keeping stop loss closing above 1955, targeting 1916-1900-1882 and 1869-1862-1850.

 
Intraday Support Levels
S1     1,916-1,900
S2     1,890
S3     1,882-1,869
Intraday Resistance Levels
R1     1,934-1,944
R2     1,955
R3     1,968-1,980

Technical Indicators

Name   Value Action
14DRSI  

54.576

Buy
20-DMA   1906.39 Buy
50-DMA  

1944.06

Buy
100-DMA   1855.12 Buy
200-DMA   1736.17 Buy
STOCH(5,3)   81.503 Buy
MACD(12,26,9)   -11.45 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$25.55/oz and low of US$24.76/oz settled up by % at US$25.08/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 24.50-21.05 targeting 24.00-24.50-25.10 and 26.00-26.50, stop breakage below 21.50. Sell below 25.30-28.00 with stop loss above 28.00; targeting 24.00-23.30-22.90 and 22.20-21.50.

 
Intraday  Support Levels
S1     24.50-24.00
S2     23.30
S3     22.90-22.20

Intraday  Resistance Levels
R1     25.30
R2     26.05-26.80
R3     27.50

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 Monday made an intra‐day high of US40.62/bbl, intraday low of US$39.26/bbl and settled down by 2.472% to close at US$39.65/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 40.10-37.50 with risk daily closing below 37.50 and targeting 40.80-42.00-42.50 and 43.10-43.85. Sell in between 40.80-43.85 with stop loss at 44.00; targeting 40.10-39.70-39.00 and 38.40-37.50-36.40.

 
Intraday Support Levels
S1     40.00-39.70
S2     39.00
S3     38.40-37.50

Intraday Resistance Levels
R1     40.80-42.00
R2     42.50
R3     43.10-43.85

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.194 Sell
20-DMA   39.86 Sell
50-DMA   40.76 Sell
100-DMA   39.92 Buy
200-DMA   38.96 Sell
STOCH(5,3)   80.130 Sell
MACD(12,26,9)   0.0111 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.1786/EUR, high of US$1.1826/EUR and settled the day up by 0.121% to close at US$1.1810/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 1.1750-1.1460 with risk below 1.1460, targeting 1.1800-1.1860 and 1.1900-1.1955-1.2010. Sell below 1.1800-1.2000 targeting 1.1690-1.1635-1.1570 and 1.1500-1.1460 with stop-loss at daily closing above 1.2050.

 
Intraday Support Levels
S1     1.1750-1.1690
S2     1.1635
S3     1.1570-1.1500

Intraday  Resistance Levels
R1     1.1800-1.1860
R2     1.1900
R3     1.1950-1.2010

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.726 Buy
20-DMA   1.1758 Buy
50-DMA   1.1800 Buy
100-DMA   1.1548 Buy
200-DMA   1.1258 Buy
STOCH(5,3)   64.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3004/GBP, high of US$1.3081/GBP and settled the day up by 0.321% to close at US$1.3062/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 1.3000-1.3270 with targets at 1.2900-1.2820-1.2735 and 1.2650-1.2600-1.2510 stop-loss should be 1.3270. Buy above 1.2940-1.2450 with targets 1.2900-1.3000 and 1.3050-1.3100-1.3210 with stop loss closing below 1.3000.

 
Intraday Support Levels
S1     1.3020-1.2940
S2     1.2900
S3     1.2820-1.2725

Intraday Resistance Levels
R1     1.3060-1.3100
R2     1.3190
R3     1.3270-1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

43.904

Buy
20-DMA   1.3180 Sell
50-DMA   1.2911 Buy
100-DMA   1.26611.2911 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 Monday made intra‐day low of JPY105.23/USD and made an intraday high of JPY105.79/USD and settled the day down by % at JPY105.31/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 105.90-108.00 with risk above 108.00 targeting 104.90-104.50-103.90 and 103.50-103.10. Long positions above 105.50-103.00 with targets of 106.90-107.50 and 107.90-108.40-109.40 with stop below 105.00.

 
Intraday Support Levels
S1     104.90
S2     104.30
S3     103.90-103.10

INTRADAY RESISTANCE LEVELS
R1     105.50-105.90
R2     106.90
R3     107.60-108.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.716 Buy
20-DMA   105.58 Sell
50-DMA   105.80 Sell
100-DMA   106.62 Sell
200-DMA   107.92 Sell
STOCH(9,6)   46.253 Sell
MACD(12,26,9)   -0.099 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING