AAFX TRADING

Daily Market Lookup

  • The dollar was up on Thursday morning in Asia, as the U.S. and the U.K. both scramble to meet deadlines for the latest stimulus measures and Brexit trade talks with the European Union (EU) respectively Investors turned to the dollar, viewed as a safe-haven asset, as doubts begin to mount on whether the Republicans and Democrats can reach a consensus over the latest stimulus measures. The two sides have until Dec. 11 to do so, in order to avert a government shutdown. However, it remains to be seen whether the two parties can agree on one of the proposals and counter proposals currently flying around Congress. The Federal Reserve will convene for its last policy meeting of 2020 later in the day. The GBP/USD pair was down 0.24% to 1.3364, staying above the week’s low of $1.3225 seen on Monday after falling around 0.5% on Thursday. This was after U.K. Prime Minister Boris Johnson and European Commission President Ursula von der Leyen agreed to delay a “firm decision” about the future of Brexit talks during their meeting. Despite a “lively” dinner with Johnson, von der Leyen warned afterwards that the European Commission and the U.K. remain “far apart” on the trade deal. Bank of England Governor Andrew Bailey issued a warning of his own, saying that a no-deal Brexit would cause longer-term damage to the U.K.’s economy than even the COVID-19 pandemic, with the impact of the change potentially felt for decades. The outcome disappointed some investors, who hoped that the dinner to bring some resolution to the stalemate between the two parties before the end-of-year deadline. Sera was referring to the European Council, which will meet from Dec. 10 to 11 in Brussels. The European Central Bank (ECB) is also convening for its last policy meeting of 2020 later in the day, where it is widely expected to expand stimulus measures to support the COVID-19-stricken EU economy. ECB President Christine Lagarde has already made it clear in recent weeks that an expanded Pandemic Emergency Purchase Program and more subsidized long-term loans for banks will form the basis of the ECB’s policy measures. The euro fell to $1.2082, a fourth consecutive day of losses and slightly below the two-and-a-half year high of $1.2177 seen on Friday. Lagarde’s comments have also reduced investor appetite for the euro.
  • The British pound lost about 0.5% on Thursday after British Prime Minister Boris Johnson and European Commission President Ursula von der Leyen agreed they have until Sunday to take a "firm decision" about the future of trade talks. The European Commission and Britain remained "far apart" on Brexit trade deal, the bloc's chief executive said after what she described as a "lively" dinner with the British Prime Minister. Bank of England Governor Andrew Bailey has warned a no-deal Brexit would cause longer-term damage to Britain's economy than the COVID-19 pandemic, and the impact of the change might be felt for decades. The U.S. dollar, which tends to fall when risk appetite is strong, held firm against other major currencies as an agreement on U.S. stimulus remains elusive as proposals and counterproposals on COVID-19 aid have flown around the U.S. Capitol. Also curbing appetite for the common currency, the European Central Bank is widely expected to expand its stimulus measures to prop up the recession-hit currency bloc at its policy meeting later on Thursday. ECB President Christine Lagarde has made clear in recent weeks that a bigger Pandemic Emergency Purchase Programme (PEPP) and more subsidised long-term loans for banks will form the backbone of its policy measures.
  • Oil prices rose on Thursday, buoyed by a COVID-19 vaccine rollout in Britain and the imminent approval of a vaccine in the United States that could spur a rebound in fuel demand, despite a large build in U.S. crude stocks last week. Vaccinations could start as soon as this weekend in the United States, with a panel of advisers to meet on Thursday to discuss whether to recommend to the Food and Drug Administration emergency use authorization of the Pfizer/BioNTech vaccine. Canada approved its first COVID-19 vaccine on Wednesday and said inoculations would start next week. Oil prices were also supported by some nervousness after two wells at a small oilfield in northern Iraq were set ablaze in what the government called a "terrorist attack", though production was not affected. Analysts were surprised that the market had shrugged off an unexpectedly large build in U.S. crude stocks in government data released on Wednesday, largely due to a plunge in U.S. crude exports to their lowest since 2018. Crude inventories rose by 15.2 million barrels in the week to Dec. 4, the Energy Information Administration said, compared with analysts' expectations in a Reuters poll for a 1.4 million -barrel drop. EIA on Tuesday cut its 2021 world oil demand growth forecast by 110,000 barrels per day to 5.78 million bpd. Oil was up on Thursday morning in Asia, with the U.K.’s rollout of a COVID-19 vaccine and the imminent arrival of the same vaccine in the U.S. spurring hopes of a recovery in fuel demand and eclipsing a larger-than-expected build in U.S. crude stocks during the previous week. A plunge in U.S. crude exports to their lowest level since 2018 saw an unusually large build in U.S. crude stocks. Data from the U.S. Energy Information Administration (EIA) released overnight showed a 15.189-million-barrel build for the week to Dec. 4, much bigger than the 1.424-million-barrel draw in forecasts prepared by Investing.com and the previous week’s 679,000-barrel draw. The EIA data follows that released by the American Petroleum Institute on Tuesday showing a 1.141-million-barrel build in U.S. crude oil supplies, also bigger than the forecast 1.514-million-barrel draw but down from the previous week’s 4.146-million-barrel build. However, some investors remained optimistic despite the data. Driving optimism for investors such as Innes are COVID-19 vaccines. The U.S. FDA will meet later in the day to discuss BNT162b2, the COVID-19 vaccine co-developed by Pfizer and BioNTech. Should the FDA grant emergency use authorization during its meeting which is widely expected, distribution could begin as soon as 24 hours after the decision, Health & Human Services Secretary Alex Azar has said Health Canada gave its nod to the vaccine on Wednesday, following the U.K.’s Medicines & Healthcare Products Regulatory Agency (MHRA)’s temporary authorization for emergency use issued during the previous week. Although the U.K. has already inoculated its first patients, MHRA has warned that anyone with a history of anaphylaxis to a medicine or food should not be inoculated. Also boosting oil prices was investor jitters following the incineration of two wells at a small oilfield in northern Iraq, described by the government as a “terrorist attack”. Although the incident has not impacted production at the oilfield, some investors expressed concern.

 

 
Intraday RESISTANCE LEVELS
10th December 2020 R1 R2 R3
GOLD-XAU 1,849-1,860 1,868 1,880-1,890
Silver-XAG 23.90¬-24.95 25.65 26.50-27.00
Crude Oil 46.50-47.50 48.00 49.20-50.00
EURO/USD 1.2150 1.2190 1.2240-1.2275
GBP/USD 1.3400-1.3480 1.3520 1.3550-1.3600
USD/JPY 104.50-105.00 105.40 105.90-106.40

Intraday SUPPORTS LEVELS
10th December 2020 S1 S2 S3
GOLD-XAU 1.836 1,821-1,808 1,790
Silver-XAG 23.20 22.60 22.00-21.50
Crude Oil 45.10-44.60 44.60 44.00-43.60
EURO/USD 1.2090-1.2050 1.1990 1.1950-1.1905
GBP/USD 1.3300-1.3250 1.3200 1.3160-1.3085
USD/JPY 103.90 103.15 102.50-102.05

Intra-Day Strategy (10th December 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 Wednesday made its intraday high of US$1870.83/oz and low of US$1825.32/oz. Gold down 1.668% at US$1838.86/oz.

Technicals in Focus:

In daily charts, prices are below 50DMA (1899) and breakage above will call for 1916. 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 1836-1796 with risk below 1796, targeting 1840-1849-1868 and 1880-1890-1900. Sell below 1839-1900 keeping stop loss closing above 1900, targeting 1829-1821-1808 and 1796-1790.

 
Intraday Support Levels
S1     1.836
S2     1,821-1,808
S3     1,790
Intraday Resistance Levels
R1     1,849-1,860
R2     1,868
R3     1,880-1,890

Technical Indicators

Name   Value Action
14DRSI  

53.041

Buy
20-DMA   1844.17 Sell
50-DMA  

1878.01

Sell
100-DMA   1910.98 Sell
200-DMA   1804.92 Buy
STOCH(5,3)   90.503 Sell
MACD(12,26,9)   -17.276 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$24.58/oz and low of US$24.41/oz settled up by 2.52% at US$24.50/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 50DMA (24.30), breakage above will lead to 25.00. MACD is below zero line and histograms are decreasing trend and it will bring bearish stance in the upcoming sessions. RSI is approaching neutral 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, Sell below 23.95-26.80 with stop loss above 26.80; targeting 23.20-22.00 and 21.60-21.20-20.50. Buy silver in between 23.50-21.60, targeting 24.95-25.65 and 26.05-26.40-26.80 with stop loss should be place on the breakage below 21.50.

 
Intraday  Support Levels
S1     23.20
S2     22.60
S3     22.00-21.50

Intraday  Resistance Levels
R1     23.90¬-24.95
R2     25.65
R3     26.50-27.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.473 Buy
20-DMA   24.11 Sell
50-DMA   25.04 Sell
100-DMA   25.04 Sell
200-DMA   20.76 Buy
STOCH(5,3)   67.268 Sell
MACD(12,26,9)   -0.121 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US46.35/bbl, intraday low of US$45.06/bbl and settled up by 0.148% to close at US$45.77/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 40.58 which is a support level and breakage below will call for 40.10. MACD is above 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 upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy above 45.10-42.00 with risk daily closing below 42.00 and targeting 45.90-46.50-47.50 and 48.60-49.30. Sell in between 46.00-49.30 with stop loss at 49.30; targeting 44.60-44.00-43.60 and 43.00-42.50-41.50.

 
Intraday Support Levels
S1     45.10-44.60
S2     44.60
S3     44.00-43.60

Intraday Resistance Levels
R1     46.50-47.50
R2     48.00
R3     49.20-50.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.216 Sell
20-DMA   43.20 Buy
50-DMA   40.88 Buy
100-DMA   40.98 Buy
200-DMA   36.44 Buy
STOCH(5,3)   70.130 Buy
MACD(12,26,9)   1.547 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday an intraday low of US$1.2058/EUR, high of US$1.2146/EUR and settled the day down by 0.0619% to close at US$1.2077/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 12090-1.1840 with risk below 1.1800, targeting 1.2150-1.2190 and 1.2240-1.2275. Sell below 1.2150-1.2275 targeting 1.2050-1.1990-1.1960 and 1.1905-1.1860 1.1790 with stop-loss at daily closing above 1.2275.

 
Intraday Support Levels
S1     1.2090-1.2050
S2     1.1990
S3     1.1950-1.1905

Intraday  Resistance Levels
R1     1.2150
R2     1.2190
R3     1.2240-1.2275

TECHNICAL INDICATORS
Name   Value Action
14DRSI   74.812 Buy
20-DMA   1.1898 Buy
50-DMA   1.1794 Buy
100-DMA   1.1494 Buy
200-DMA   1.1426 Buy
STOCH(5,3)   97.758 Buy
MACD(12,26,9)   0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3346/GBP, high of US$1.3477/GBP and settled the day up by 0.288% to close at US$1.3388/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 1.3400-1.3600 with targets at 1.3340-1.3290 and 1.3200-1.3150-1.3100 stop-loss should be 1.3550. Buy above 1.3340-1.2880 with targets 1.3400-1.3480-1.3520 and 1.3550-1.3600 with stop loss closing below 1.2800.

 
Intraday Support Levels
S1     1.3300-1.3250
S2     1.3200
S3     1.3160-1.3085

Intraday Resistance Levels
R1     1.3400-1.3480
R2     1.3520
R3     1.3550-1.3600

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

53.783

Buy
20-DMA   1.3317 Sell
50-DMA   1.3133 Buy
100-DMA   1.3080 Buy
200-DMA   1.2746 Buy
STOCH(5,3)   68.940 Buy
MACD(12,26,9)   0.009 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY103.94/USD and made an intraday high of JPY104.20/USD and settled the day up by 0.103% at JPY104.15/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 104.50-108.00 with risk above 108.00 targeting 103.90-103.10 and 102.50-102.00. Long positions above 104.00-101.00 with targets of 105.00-106.90 and 107.50-107.90-108.40 with stop below 105.00.

 
Intraday Support Levels
S1     103.90
S2     103.15
S3     102.50-102.05

INTRADAY RESISTANCE LEVELS
R1     104.50-105.00
R2     105.40
R3     105.90-106.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.307 Buy
20-DMA   104.40 Sell
50-DMA   105.36 Sell
100-DMA   105.36 Sell
200-DMA   106.45 Sell
STOCH(9,6)   57.253 Sell
MACD(12,26,9)   -0.199 Sell

AAFX TRADING
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