AAFX TRADING

Daily Market Lookup

  • The dollar was down on Wednesday morning in Asia, despite caution over the new B.1.1.7 strain of the COVID-19 virus pushing investors turn toward safe-haven assets. The discovery of the B.1.1.7 strain, first seen in the U.K., saw London and southeastern England put under Tier 4 lockdowns. The Philippines banned all U.K. flights from Dec. 24 earlier in the day, joining over 40 countries that have closed their borders to the U.K. and causing travel chaos just a few days before Christmas. With the U.K. government also negotiating a post-Brexit deal with the European Union (EU), some investors expected dollar weakness to continue in the short term. Demand for the dollar had been weakening as the rollout of vaccines and the possibility of more U.S. stimulus measures boosted hopes for a global economic recovery from COVID-19, sapping demand for the dollar and other safe-haven currencies. The Senate also passed the COVID-19 aid package bill on Monday, following the House of Representatives passing the bill earlier. However, President Donald Trump's threat not to sign the bill seems to have a smaller-than-expected impact on investors. The AUD/USD pair gained 0.43% to 0.7553. Australia continues to deal with a new outbreak of COVID-19 cases in Sydney’s Northern Beaches area. With the number of cases growing to 97, authorities said that the current lockdown will be extended over the Christmas holidays to curb the spread of the virus in the city. New South Wales state Premier Gladys Berejiklian said that decisions on the lockdown in terms of New Year’s Eve celebrations and upcoming sporting events will be made after Christmas. EU chief Brexit negotiator Michel Barnier said the bloc is making a “final push” for a deal, although the two sides still disagree over the matter of fishing rights.
  • The dollar held gains against major peers in holiday-thinned trading on Wednesday as caution about a fast-spreading coronavirus variant in the UK stoked demand for the safest assets. The pound has fallen for three straight days as time runs out for London to reach a trade deal with Brussels before the UK completes its exit from the European Union at year-end. The market has been positioned for a pandemic recovery that lifts global growth, sapping demand for the dollar and other haven currencies. U.S. Congress passed an $892 billion COVID-19 aid package overnight, and vaccine rollouts are gaining momentum. That development has since been clouded by President Donald Trump's threat not to approve the stimulus bill, saying it should be amended to increase the amount in the stimulus checks, though this has had little impact on markets so far. At the same time, the new coronavirus variant has introduced new risks to that rosy scenario, even as medical experts have sought to allay people's fears. With only days left before the UK leaves the EU's trade orbit, the pound has vacillated as it awaits signs of progress in negotiations. A deal is possible Wednesday, an ITV (LON:ITV) reporter tweeted. Earlier, the EU's chief negotiator said the bloc is making a "final push" for a trade deal, although there are still deep rifts over fishing rights.
  • Gold was up on Wednesday morning in Asia, slowly gaining back earlier losses. U.S. President Donald Trump said on Tuesday that he may not sign a COVID-19 bill passed by both the House of Representatives and the Senate on Monday. He called the bill an unsuitable “disgrace,” but stopped short of threatening to veto the legislation. The threat puts the bill becoming law, which requires Trump’s signature, and the timing of Americans receiving stimulus checks, into disarray. President-elect Joe Biden has said his administration will put forward another COVID-19 relief package early next year but warned that the “darkest days in the battle against COVID-19 are ahead of us.” More countries continue to impose new travel restrictions to keep the new B.1.1.7 strain of the COVID-19 virus out. The Philippines banned all U.K. flights from Dec. 24 earlier in the day, joining a list of more than 40 countries shutting their borders to the U.K., where the strain was first seen. The U.K. itself has already imposed a Tier 4 lockdown on London and southeastern England. Drugmakers are now scrambling to test their COVID-19 vaccines against the new strain. Even with the rollout of two vaccines in the U.S., the country reported the most number of cases for any single country, the World Health Organization said on Tuesday. On the data front, grim U.S. consumer and housing data had earlier bolstered hopes for further stimulus to support an economic recovery from COVID-19. The data showed that the Conference Board (CB) Consumer Confidence index fell to 88.6 in December, down from the 97 in forecasts prepared by Investing.com and November’s 92.9 reading. Existing home sales also fell to 6.69 million in November, down from the forecast 6.7 million and October’s 6.86 million However, the Commerce Department said that the country’s GDP rose at a record 33.4% quarter-on-quarter in the third quarter, higher than the 33.1% growth in forecasts and the 31.4% contraction seen in the second quarter. Across the Atlantic, the European Union (EU) rejected U.K. Prime Minister Boris Johnson’s latest concessions on fishing rights as the two sides continue to negotiate a post-Brexit trade deal. However, there were hopes that the EU would continue negotiations with the U.K. past the end-of-the-year deadline after an update from EU chief Brexit negotiator Michel Barnier.
  • Oil fell in early trade on Wednesday after industry data showed U.S. crude oil stocks rose last week, defying expectations for a decline, and U.S. President Donald Trump rattled markets by threatening not to sign a long-awaited COVID-19 relief bill. Both contracts fell nearly 2% on Tuesday, in a second straight session of declines, with Brent just managing to settle above $50 ahead of the release of the data from the American Petroleum Institute (API). API reported crude inventories rose by 2.7 million barrels in the week to Dec. 18, compared with analysts' expectations in a Reuters poll for a decline of 3.2 million barrels. Distillate stocks, which include diesel, heating oil and jet fuel, rose by 1 million barrels, also a surprise against expectations for a drawdown of 904,000 barrels. However, gasoline stocks fell by 224,000 barrels, against expectations for a build of 1.2 million barrels. Oil fell further after Trump threatened not to sign an $892 billion coronavirus relief bill, saying he wants Congress to increase the amount in the stimulus checks which lawmakers approved on Monday. COVID-19 cases continued to surge in the United States, with more than a million new cases in just six days, and Americans were warned again to avoid travelling for Christmas, further dampening fuel demand.

 

 
Intraday RESISTANCE LEVELS
23rd December 2020 R1 R2 R3
GOLD-XAU 1,881-1,890 1,905 1,918-1,931
Silver-XAG 25.60-26.05 26.50 27.00-27.65
Crude Oil 47.00-48.00 49.20 50.00-50.40
EURO/USD 1.2245-1.2275 1.2350 1.2400-1.2475
GBP/USD 1.3470-1.3540 1.3590 1.3670
USD/JPY 103.80-104.50 105.00 105.40-105.90

Intraday SUPPORTS LEVELS
23rd December 2020 S1 S2 S3
GOLD-XAU 1,860-1,849 1,836 1,830-1,817
Silver-XAG 24.95 24.50 24.10-23.70
Crude Oil 46.45 45.90 45.10-44.60
EURO/USD 1.2170-1.2140 1.2090 1.2050-1.1990
GBP/USD 1.3400-1.3340 1.3240 1.3200-1.3140
USD/JPY 103.15-102.50 102.05 101.60-101.20

Intra-Day Strategy (23rd 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 Tuesday made its intraday high of US$1884.22/oz and low of US$1858.83/oz. Gold down 0.961% at US$1858.83/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 1860-1817 with risk below 1849, targeting 1881-1890-1905 and 1918-1931-1940. Sell below 1881-1956 keeping stop loss closing above 1956, targeting 1860-1849-1836 and 1830-1817.

 
Intraday Support Levels
S1     1,860-1,849
S2     1,836
S3     1,830-1,817
Intraday Resistance Levels
R1     1,881-1,890
R2     1,905
R3     1,918-1,931

Technical Indicators

Name   Value Action
14DRSI  

61.041

Buy
20-DMA   1838.19 Sell
50-DMA  

1870.78

Sell
100-DMA   1903.27 Sell
200-DMA   1815.19 Buy
STOCH(5,3)   88.503 Buy
MACD(12,26,9)   -6.276 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$26.56/oz and low of US$25.06/oz settled down by 3.72% at US$25.16/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 in between 25.60-28.00 with stop loss above 28.90; targeting 24.95-24.50 and 24.05-23.70. Buy silver in between 25.50-23.70, targeting 26.05-26.50-27.05 and 27.65-28.00-28.50 with stop loss should be place on the breakage below 24.60.

 
Intraday  Support Levels
S1     24.95
S2     24.50
S3     24.10-23.70

Intraday  Resistance Levels
R1     25.60-26.05
R2     26.50
R3     27.00-27.65

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.473 Buy
20-DMA   24.37 Sell
50-DMA   24.28 Sell
100-DMA   25.11 Sell
200-DMA   21.21 Buy
STOCH(5,3)   90.268 Sell
MACD(12,26,9)   0.480 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US47.95/bbl, intraday low of US$46.25/bbl and settled down by 2.97% to close at US$47.82/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 20DMA i.e. 45.74 which is a support level and breakage below will call for 45.74. 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 46.45-44.60 with risk daily closing below 44.60 and targeting 47.00-48.00-49.20 and 50.00 and 50.40- 50.90-51.50. Sell in between 47.00-51.30 with stop loss at 51.30; targeting 46.45-45.90 and 45.10-44.60-43.85.

 
Intraday Support Levels
S1     46.45
S2     45.90
S3     45.10-44.60

Intraday Resistance Levels
R1     47.00-48.00
R2     49.20
R3     50.00-50.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.216 Sell
20-DMA   46.44 Buy
50-DMA   42.67 Buy
100-DMA   41.71 Buy
200-DMA   36.93 Buy
STOCH(5,3)   58.130 Buy
MACD(12,26,9)   1.555 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.2151/EUR, high of US$1.2256/EUR and settled the day down by 0.644% to close at US$1.2160/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 20DMA (1.2050), which become immediate resistance level, break above will target 1.1990. MACD is above zero line and histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving positive crossovers to signal for bullish outlook for intraday. 14D RSI is currently in overbought region and giving no directions to consider right now.

Trading Strategy: Neutral to Buy

Buy above 1.2190-1.1840 with risk below 1.1800, targeting 1.2240-1.2275 and 1.2350-1.2400-1.2475. Sell below 1.2240-1.2475 targeting 1.2190-1.2150-1.2090 and 1.2050-1.1990-1.1960 with stop-loss at daily closing above 1.2475.

 
Intraday Support Levels
S1     1.2170-1.2140
S2     1.2090
S3     1.2050-1.1990

Intraday  Resistance Levels
R1     1.2245-1.2275
R2     1.2350
R3     1.2400-1.2475

TECHNICAL INDICATORS
Name   Value Action
14DRSI   67.812 Buy
20-DMA   1.2107 Buy
50-DMA   1.1919 Buy
100-DMA   1.1859 Buy
200-DMA   1.1490 Buy
STOCH(5,3)   76.758 Buy
MACD(12,26,9)   0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3302/GBP, high of US$1.3469/GBP and settled the day down by 0.830% to close at US$1.3351/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 in between 1.3470-1.3540 with targets at 1.3400-1.3340-1.3240 and 1.3200-1.3140-1.3115 stop-loss should be 1.3540. Buy above 1.3400-1.3150 with targets 1.3470-1.3540 and 1.3600-1.3670 with stop loss closing below 1.3100.

 
Intraday Support Levels
S1     1.3400-1.3340
S2     1.3240
S3     1.3200-1.3140

Intraday Resistance Levels
R1     1.3470-1.3540
R2     1.3590
R3     1.3670

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 JPY103.27/USD and made an intraday high of JPY103.72/USD and settled the day up by 0.301% at JPY103.62/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 103.80-108.00 with risk above 108.00 targeting 103.15-102.50-102.05 and 101.60-101.20. Long positions above 103.10-101.00 with targets of 103.80-104.50-105.00 and 105.40-105.90- with stop below 105.00.

 
Intraday Support Levels
S1     103.15-102.50
S2     102.05
S3     101.60-101.20

INTRADAY RESISTANCE LEVELS
R1     103.80-104.50
R2     105.00
R3     105.40-105.90

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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