AAFX TRADING

Daily Market Lookup

  • The dollar was down on Monday morning in Asia, with the U.S. Federal Reserve expected to increase purchases of longer-dated Treasuries to contain a rise in yields when it hands down its policy later in the week. The dollar is also under pressure with investors expectant that the Fed will keep interest rates low for an extended period at its last policy meeting of 2020. Investors had been retreating from the dollar as hopes for a global economic recovery from COVID-19 grew over positive vaccine news and hopes for the latest U.S. stimulus measures increasing investors’ risk appetite. The U.S. Food and Drug Administration (FDA) approved the emergency use authorization of BNT162b2, the COVID-19 vaccine co-developed by Pfizer (NYSE:PFE) and BioNTech SE (F:22UAy), on Dec. 11 The AUD was up against the dollar ahead of the release of the Reserve Bank of Australia ‘s minutes from its latest policy meeting, due on Tuesday. Investors are widely expected to scale back bets for additional monetary policies following the minutes’ release. The GBP/USD pair rose 0.73% to 1.3320, seeing its biggest one-day gain since Dec. 1 over increased hopes that the U.K. and the European Union (EU) would reach a Brexit trade deal. Hopes were raided after both parties agreed to extend talks beyond a Sunday deadline set by both parties during the previous week. Negotiators for both sides will “go the extra mile” in coming days to try to reach an agreement before the end-of-the-year deadline to avert a chaotic divorce between the U.K. and the EU, despite missing the latest deadline. The U.K. has been in a transition period since it formally left the EU in January, during which rules on trade, travel and business remained unchanged as the country remained in the EU single market and customs union. However, should both sides fail to reach an agreement before the end of the month, around $1 trillion in annual trade from tariffs and quotas, businesses on both sides would be left unprotected and at risk. Some investors said that the pound is more vulnerable to selling than the euro, warning that the pound’s rally is not likely to last. Both sides have yet to narrow their differences on a variety of issues, including fishing rights, and the risk that they will not reach a deal before the deadline remains.
  • The British pound rose against the dollar and euro on hopes that Britain and the European Union will secure a free trade agreement after their decision to extend negotiations beyond the Sunday deadline. The dollar traded near a 2 1/2-year low against major peers ahead of a U.S. Federal Reserve meeting ending Wednesday where policymakers are expected to increase purchases of longer-dated Treasuries to contain a rise in yields. The rally in sterling may not last, some analysts warn, because Britain and the EU have repeatedly struggled to narrow their differences and there is still a risk that trade and business will be thrown into chaos without an agreement. London and Brussels agreed on Sunday to "go the extra mile" in coming days to try to reach an elusive trade agreement despite missing their latest deadline to avert a turbulent exit for Britain from the European Union at the end of the month. Britain formally left the EU in January, but has since been in a transition period during which it remains in the EU single market and customs union, meaning that rules on trade, travel and business have stayed the same. That all ends on Dec. 31, and if by then there is no agreement to protect around $1 trillion in annual trade from tariffs and quotas, businesses on both sides would be hit hard, but the British pound is more vulnerable to selling than the euro, analysts warn. The dollar, which has also been under selling pressure recently, faces a big week because of the Fed's policy meeting U.S. dollar net short positioning in the latest week climbed to its highest since late September, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday. The dollar index against a basket of six major currencies stood at 90.793, close to a 2 1/2-year low. Investors have sold the dollar on expectations of a global recovery, buoyed by positive coronavirus vaccine news and hopes for further U.S. stimulus that should lift the market's risk appetite. The dollar is also under pressure due to expectations that U.S. interest rates will remain low for an extended period.
  • Oil prices rose on Monday, pushing Brent back above $50 a barrel, buoyed by hopes that a rollout of coronavirus vaccines will lift global fuel demand while a tanker explosion in Saudi Arabia jangled nerves in the market. Prices also extended gains amid supply jitters after a shipping firm said an oil tanker was hit by an external source while discharging at Jeddah port in Saudi Arabia. Brent and WTI have rallied for six consecutive weeks, their longest stretch of gains since June. The United States kicked off its vaccination campaign against COVID-19, buoying hopes that pandemic restrictions could end soon and lift demand at the world's largest oil consumer. An extension of Brexit talks among European powers also buoyed financial markets on Monday. Major European countries continued in lockdown mode to curb the spread of COVID-19 which has reduced fuel demand. For example, Germany, the fourth largest economy in the world, plans to impose stricter lockdown from Wednesday to battle the virus. Investors are looking ahead to two meetings between the Organization of the Petroleum Exporting Countries and its allies including Russia, a grouping known as OPEC+. The OPEC+ joint ministerial monitoring committee (JMMC) that monitors compliance among members will meet on Dec. 16, while OPEC+ will meet on Jan. 4 to study the market after their last decision to limit production rises to 500,000 barrels per day starting next year. In the United States, energy firms last week added the most oil and natural gas rigs in a week since January as producers continued to return to the wellpad. Two separate fires occurred at Nigeria's Qua Iboe crude oil export terminal and at an oil pipeline in Iran on Sunday but the incidents have mostly been contained.

 

 
Intraday RESISTANCE LEVELS
14th 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 47.50 48.00 49.20-50.00
EURO/USD 1.2150 1.2190 1.2240-1.2275
GBP/USD 1.3300-1.3400 1.3480 1.3520-1.3550
USD/JPY 104.50-105.00 105.40 105.90-106.40

Intraday SUPPORTS LEVELS
14th December 2020 S1 S2 S3
GOLD-XAU 1.830 1,821-1,808 1,790
Silver-XAG 23.60-23.20 22.60 22.00-21.50
Crude Oil 46.50-45.10 44.60 43.90-43.00
EURO/USD 1.2090-1.2050 1.1990 1.1950-1.1905
GBP/USD 1.3250 1.3200 1.3160-1.3085
USD/JPY 103.80 103.15 102.50-102.05

Intra-Day Strategy (14th 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 Friday made its intraday high of US$1847.67/oz and low of US$1823.90/oz. Gold up 0.222% at US$1839.32/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 1830-1796 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     1.830
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 Friday made its intraday high of US$24.10/oz and low of US$23.58/oz settled down by 0.171% at US$23.92/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 23.60-26.80 with stop loss above 26.80; targeting 23.20-22.00 and 21.60-21.20-20.50. Buy silver in between 23.60-21.60, 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     23.60-23.20
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   47.473 Buy
20-DMA   23.82 Sell
50-DMA   25.06 Sell
100-DMA   25.06 Sell
200-DMA   20.85 Buy
STOCH(5,3)   67.268 Sell
MACD(12,26,9)   -0.121 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US47.40/bbl, intraday low of US$46.46/bbl and settled up by 1.088% to close at US$46.59/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 46.50-42.00 with risk daily closing below 42.00 and targeting 47.50-48.00-48.60 and 49.30-50.00. Sell in between 47.50-50.30 with stop loss at 50.30; targeting 44.60-44.00-43.60 and 43.00-42.50-41.50.

 
Intraday Support Levels
S1     46.50-45.10
S2     44.60
S3     43.90-43.00

Intraday Resistance Levels
R1     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 Friday an intraday low of US$1.2162/EUR, high of US$1.2162/EUR and settled the day up by 0.196% to close at US$1.2112/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 Friday made an intra‐day low of US$1.3133/GBP, high of US$1.3323/GBP and settled the day down by 0.616% to close at US$1.3234/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 1.3300-1.3600 with targets at 1.3290-1.3200 and 1.3150-1.3100 stop-loss should be 1.3550. Buy above 1.3250-1.2880 with targets 1.3340-1.3400-1.3480 and 1.3520-1.3600 with stop loss closing below 1.2800.

 
Intraday Support Levels
S1     1.3250
S2     1.3200
S3     1.3160-1.3085

Intraday Resistance Levels
R1     1.3300-1.3400
R2     1.3480
R3     1.3520-1.3550

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 Friday made intra‐day low of JPY103.81/USD and made an intraday high of JPY104.26/USD and settled the day up by 0.170% at JPY104.04/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     103.80
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
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING