AAFX TRADING

Daily Market Lookup

  • The dollar was up on Thursday morning in Asia, continuing a rebound from near three-year lows against major peers as investors await U.S. President-elect Joe Biden’s plans for further stimulus measures. Chinese trade data released earlier in the day outperformed, with exports growing 18.1% year-on-year, imports growing 6.5% year-on-year and the trade balance at $78.17 billion in December. Biden is scheduled to unveil plans for “trillions” of dollars in further COVID-19 stimulus measures later in the day. Investor expectancy that the measures will lead to faster economic recovery lifted U.S. Treasury yields, in turn giving the greenback a boost. Investors continued to unwind bearish bets, which also helped the U.S. currency hold onto gains made on Wednesday. The prospect of more stimulus measures weighed in on U.S. government bonds and saw the benchmark Treasury yield top 1% for the first time since March 2020, in turn leading the dollar to ee gains in four of the past five trading sessions. Bitcoin held onto its 10% gains from Wednesday, rallying after a slide of almost $12,000 from its all-time high of $42,000 seen during the previous week. The digital currency was 0.6% higher at $37,655 on Thursday, climbing up from the low of $30,261.13 seen on Jan. 11. However, some investors were cautious and warned that the dollar’s bounce could be temporary, as a build-up of bearish positions are unwound. FOREX speculators have been net short the dollar since March 2020 as a surge in investors’ appetite for riskier assets turned them away from the dollar. More stimulus will also support risk sentiment in the long term, further dampening demand for the safe-haven dollar.
  • The dollar extended its rebound from near three-year lows versus major peers on Thursday, supported by higher U.S. yields, as President-elect Joe Biden prepared to outline his plans for massive fiscal stimulus. The dollar index held onto gains made on Wednesday in early Asian trading as investors continued to unwind bearish bets. The dollar has risen in four of the past five trading sessions as the prospect of more stimulus has weighed on U.S. government bonds, sending the benchmark Treasury yield above 1% for the first time since March. Bitcoin also held on to 10% gains made on Wednesday as it rebounded after sliding almost $12,000 from an all-time high of $42,000 hit last week. Biden will give details on Thursday of a plan for "trillions" of dollars in pandemic relief. The 10-year Treasury yield ticked up after CNN reported the package will be around $2 trillion, adding support for the dollar However many analysts expect the currency's bounce to be temporary, as a build up of bearish dollar positions are shaken out. Longer term, they expect more U.S. stimulus to support risk sentiment, weighing on the greenback, which is traditionally considered a safe-haven. FX speculators have been net short the dollar since mid-March, as investors' surging appetite for riskier assets hurt demand for the greenback. Interest in the cryptocurrency has been soaring as institutional investors began buying heavily, viewing it as both an inflation hedge and as exposed to gains if it became more widely adopted.
  • Gold was down on Thursday morning in Asia, with investors awaiting details on U.S. President-elect Joe Biden’s plans for further stimulus measures. Biden has promised to deliver measures that could cost “trillions” of dollars and will unveil them later in the day The yellow metal will be struggling around these price levels as the stimulus will have both positive and negative impacts, she added. Investors will also look for further clues on the U.S. monetary policy outlook when Federal Reserve Chairman Jerome Powell speaks at a virtual event later in the day. Fed Governor Lael Brainard has already pushed back against suggestions the Fed could taper its bond-buying program in 2021. The central bank said on Wednesday the U.S. economy was growing modestly, although it tempered optimism as the number of COVID-19 cases continues to surge. Meanwhile, investors are monitoring the ongoing political unrest in the U.S. ahead of Biden and his administration taking office on Jan. 20. Earlier in the day, the House of Representatives voted 232-197 to impeach incumbent President Donald Trump on the charge of inciting his supports to the Capitol Hill riot during the past week that left five dead and the building ransacked. The vote opens Trump’s second impeachment, after little more than a year since his first and making him the first U.S. president to face two impeachments.
  • Oil was down Thursday morning in Asia, with investors weighing the ever-rising number of COVID-19 cases and the impact for fuel demand against a fifth consecutive week of declines in U.S. crude oil supply. U.S. crude oil supply data from the U.S. Energy Information Administration (EIA) released on Wednesday showed a draw of 3.247 million barrels for the week to Jan. 8. The draw was bigger than the 2.266-million-barrel draw in forecasts prepared by Investing.com, but smaller than the previous week’s 8.010-million-barrel draw. Tuesday’s data from the American Petroleum Institute showed a draw of 5.821 million barrels. The EIA data also showed a rise in gasoline and distillate inventories as refiners increased output to the highest level since August 2020. On the COVID-19 front, China reported that the number of new cases in its northeastern province of Heilongjiang nearly tripled, the biggest daily jump in more than ten months. The outbreak in the world’s second largest oil consumer underscores the growing threat ahead of the Lunar New Year holidays in February. In Europe, tighter and longer lockdown measures were introduced in some countries to curb the B177 strain of the virus first seen in southeastern England in September 2020 as the impact of COVID-19 vaccine rollouts is not expected to be seen for another two to three months. Oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook, an International Energy Agency official told Reuters. However, more stimulus measures that are expected to be unveiled by U.S. President-elect Joe Biden later in the day helped cap losses. Also giving prices a boost was a reported move by Saudi Arabia, the world’s top oil exporter, to cut supplies of February-loading crude for some Asian buyers by up to a quarter.

 

 
Intraday RESISTANCE LEVELS
14th January 2021 R1 R2 R3
GOLD-XAU 1,852-1,867 1,878 1,887-1,900
Silver-XAG 25.60-26.05 26.50 27.00-27.65
Crude Oil 53.60-54.00 54.60 55.00-55.70
EURO/USD 1.2190-1.2250 1.2300 1.2350-1.2400
GBP/USD 1.3670-1.3710 1.3800 1.3860-1.3900
USD/JPY 104.00-104.50 105.00 105.40-106.00

Intraday SUPPORTS LEVELS
14th January 2021 S1 S2 S3
GOLD-XAU 1,838 1,828 1,817-1,810
Silver-XAG 25.05-24.45 24.00 23.60-23.20
Crude Oil 53.00 52.50 51.90-51.20
EURO/USD 1.2140 1.2090 1.2050-1.1960
GBP/USD 1.3590 1.3540 1.3470-1.3400
USD/JPY 103.80-103.15 102.50 102.05-101.60

Intra-Day Strategy (14th January 2021)
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$1862.97/oz and low of US$1841.82/oz. Gold down 0.526% at US$1844.34/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 1852-1800 with risk below 1800, targeting 1867-1918-1931-1948 and 1955-1965-1973. Sell below 1867-1900 keeping stop loss closing above 1900, targeting 1900-1885 and 1878-1860.

 
Intraday Support Levels
S1     1,838
S2     1,828
S3     1,817-1,810
Intraday Resistance Levels
R1     1,852-1,867
R2     1,878
R3     1,887-1,900

Technical Indicators

Name   Value Action
14DRSI  

43.114

Buy
20-DMA   1879.04 Buy
50-DMA  

1867.81

Buy
100-DMA   1891.14 Sell
200-DMA   1837.55 Buy
STOCH(5,3)   23.503 Sell
MACD(12,26,9)   7.276 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$25.67/oz and low of US$25.11/oz settled down by 1.211% at US$25.20/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 overbought 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, sell in between 25.60-28.00 with stop loss above 28.00; targeting 25.05-24.45-24.00 and 23.60-23.20. Buy silver in between 25.05-23.20, targeting 25.60-26.05-26.50 and 27.00-27.65-28.00 with stop loss should be place on the breakage below 24.60.

 
Intraday  Support Levels
S1     25.05-24.45
S2     24.00
S3     23.60-23.20

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   68.957 Buy
20-DMA   25.42 Sell
50-DMA   24.56 Sell
100-DMA   25.06 Sell
200-DMA   21.68 Buy
STOCH(5,3)   77.268 Buy
MACD(12,26,9)   0.7277 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US53.90/bbl, intraday low of US$52.57/bbl and settled down by 0.877% to close at US$52.85/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 20DMA i.e. 48.34 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 52.50-48.50 with risk daily closing below 48.50 and targeting 53.60-54.00-54.60 and 55.00-55.70. Sell in between 53.60-55.70 with stop loss at 55.70; targeting 52.50-51.90-51.20 and 50.25-49.30-48.50.

 
Intraday Support Levels
S1     53.00
S2     52.50
S3     51.90-51.20

Intraday Resistance Levels
R1     53.60-54.00
R2     54.60
R3     55.00-55.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.2031 Sell
20-DMA   48.67 Buy
50-DMA   44.96 Buy
100-DMA   42.54 Buy
200-DMA   38.45 Buy
STOCH(5,3)   91.130 Buy
MACD(12,26,9)   1.697 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday an intraday low of US$1.2139/EUR, high of US$1.2222/EUR and settled the day down by 0.404% to close at US$1.2156/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 20DMA (1.2177), which become immediate resistance level, break above will target 1.1970. MACD is above zero line and histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving negative crossovers to signal for bearish 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 1.2140-1.1840 with risk below 1.1800, targeting 1.1250-1.2300-1.2350 and 1.2400-1.2475-1.2545. Sell below 1.2190-1.2545 targeting 1.2140-1.2090 and 1.2050-1.1990 with stop-loss at daily closing above 1.2545.

 
Intraday Support Levels
S1     1.2140
S2     1.2090
S3     1.2050-1.1960

Intraday  Resistance Levels
R1     1.2190-1.2250
R2     1.2300
R3     1.2350-1.2400

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.812 Buy
20-DMA   1.2226 Buy
50-DMA   1.2051 Buy
100-DMA   1.1916 Buy
200-DMA   1.1584 Buy
STOCH(5,3)   27.758 Sell
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3610/GBP, high of US$1.3700/GBP and settled the day up by 0.1844% to close at US$1.3634/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 1.3670-1.3900 with targets at 1.3590-1.3540-1.3470 and 1.3400-1.3340-1.3240 stop-loss should be 1.3900. Buy above 1.3590-1.3240 with targets 1.3670-1.3710-1.3800 and 1.3860-1.3900 with stop loss closing below 1.3200.

 
Intraday Support Levels
S1     1.3590
S2     1.3540
S3     1.3470-1.3400

Intraday Resistance Levels
R1     1.3670-1.3710
R2     1.3800
R3     1.3860-1.3900

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

58.783

Buy
20-DMA   1.3461 Sell
50-DMA   1.3305 Buy
100-DMA   1.3158 Buy
200-DMA   1.2849 Buy
STOCH(5,3)   82.940 Buy
MACD(12,26,9)   0.009 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY103.51/USD and made an intraday high of JPY103.99/USD and settled the day up by 0.110% at JPY103.86/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 103.10-102.50-102.05 and 101.60-101.20. Long positions above 103.10-101.00 with targets of 103.80-104.50 and 105.00-105.40 with stop below 105.00.

 
Intraday Support Levels
S1     103.80-103.15
S2     102.50
S3     102.05-101.60

INTRADAY RESISTANCE LEVELS
R1     104.00-104.50
R2     105.00
R3     105.40-106.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   34.604 Buy
20-DMA   103.60 Sell
50-DMA   104.07 Sell
100-DMA   104.83 Sell
200-DMA   106.02 Sell
STOCH(9,6)   27.253 Sell
MACD(12,26,9)   -0.290 Sell

AAFX TRADING
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