AAFX TRADING

Daily Market Lookup

  • The dollar was down on Tuesday morning in Asia but was near a three-and-a-half high as bond yields rose and the U.S.’ economic normalization from COVID-19 is expected to come faster than expected, which puts the U.S. currency at a distinct advantage. The USD/JPY pair was up 0.22% to 109.09, with the dollar rising to its highest level against the yen in nine months and surpassing the 109-mark. Japan released data earlier in the day that said that the GDP grew 2.8% quarter-on-quarter in the fourth quarter of 2020, lower than both the 3% growth in forecasts prepared by Investing.com and the third quarter’s 5.3% growth. The data also said that GDP grew 11.7% year-on-year, also below the forecast 12.7% growth and the third quarter’s 22.9% growth. The euro dropped to a low last seen in late November 2020, ahead of the European Central Bank handing down its policy decision on Thursday. Investors also continue to price in increasing optimism for the U.S. economic recovery from COVID-19, as well as higher inflation, as ten-year U.S. bond yields climbed to a one-year high on Friday. There are concerns that yields could rise further, ahead of a $120 billion auction of three, ten, and 30-year Treasuries later in the week. The previous week saw a soft auction, particularly for seven-year notes, that drove yields up. Meanwhile, COVID-19 vaccines continue to be rolled out in the U.S., with around 30 million people, or 9.2% of the U.S. population, inoculated against the virus. This statistic led the U.S. Centers for Disease Control and Prevention to recommend that fully vaccinated people can meet without masks indoors in small groups with others who have been inoculated. The Fed will next meet for its two-day policy meeting on Mar. 16.
  • The dollar held near a 3 1/2-month high against its rivals on Tuesday as higher bond yields and expectations of faster economic normalisation from the pandemic in the United States put the U.S. currency at an advantage. The dollar index has firmed more than 2% so far this year as upbeat marcoeconomic data, combined with a loose monetary policy, has lifted bond yields and pressured richly valued U.S. technology stocks. All eyes will now be on the U.S. Federal Reserve's two-day meeting next week, although expectations are low that the central bank will announce major policy changes after Chair Jerome Powell last week did not express concern about the rise in bond yields. Traders are wary yields could rise further this week as the market will have to digest a $120 billion auction of 3-, 10-, and 30-year Treasuries, especially after last week's soft auction and a horrible 7-year note sale that saw a spike in yields. Higher U.S. yields have started to undermine emerging market currencies, which had attracted funds escaping rock-bottom bond returns in the United States. Another test for the market later will be the sale of three-year Treasury notes at 1 PM ET (1800 GMT), a week after a poorly-received auction of seven-year notes triggered a sharp rise in yields. Three-year maturities are more sensitive to short-term interest rates, and the prices bid will thus be a more explicit comment on when investors expect the Federal Reserve to start hiking interest rates. Driving the gains in the greenback, with the dollar index up around 2.5% this year, has been upbeat macroeconomic data, combined with a loose monetary policy. Analysts have revised their forecasts for U.S. growth higher while tending to revise down their forecasts for other countries. Added to the mix has been the passage of the Biden’s administration’s $1.9 trillion stimulus plan on Saturday, which heads back to the House of Representatives this week after being passed by the Senate over the weekend, which has raised concerns of increased inflationary pressures. The yield on the benchmark 10-year Treasury currently trades around 1.55%, below the 1.62% level seen at the end of last week, but could rise again this week as the market will have to digest a $120 billion auction 10- and 30-year Treasuries in addition to the three-year notes later Tuesday.
  • Oil fell the most in a week as the dollar strengthened and investors shrugged off an attack on the world’s largest crude terminal in Saudi Arabia. Global benchmark Brent futures slid 1.6% on Monday after earlier surging above $71 a barrel. The Bloomberg Dollar Spot Index rose as much as 0.5% on Monday, reducing the appeal of commodities priced in the currency. Meanwhile, the market looked past an assault on a storage tank farm at the Ras Tanura terminal on Sunday, with Saudi Arabia saying the attack was intercepted and oil output appeared to be unaffected. Oil has surged more than 30% this year as OPEC+ keeps a lid on production and demand is seen recovering with economies emerging from the coronavirus crisis. Forward oil prices point toward further strength, with the Brent strip for 2022 near the highest since July 2019. Production and export capabilities following the attack in Saudi Arabia “came out relatively unscathed, so the market has taken that as a cue for some profit-taking,” said Tony Headrick, energy commodity broker at CHS Hedging. “But underlying it all is a fundamental setup that is supportive. Global crude and product inventories continue to drain down, encouraged as of late by the recent OPEC+ decision.” Meanwhile, the U.S. market continued to recover from the effects of the deep freeze that hit Texas and other parts of the country last month. Seven of 18 refineries that were affected by the cold blast -- representing over 2 million barrels a day of crude processing capacity -- were operating normally as of Monday. Physical oil prices in the U.S. have rebounded, with Mars Blend trading this month at the largest premium to Nymex oil futures in nearly three weeks. The global benchmark crude’s rally north of $70 earlier Monday may cause a headache for Asian refiners, which are warning that the rapid surge and spike in volatility will hurt demand and whittle away still-tight processing margins. Saudi Arabia has also boosted its official selling prices to buyers in the region for April. Saudi Arabia said the Ras Tanura site on the country’s Gulf coast was targeted by a drone from the sea. The terminal is capable of exporting about 6.5 million barrels a day -- almost 7% of demand -- and, as such, is one of the world’s most protected facilities. It’s the most serious attack on Saudi oil installations since a key processing facility and two oil fields came under fire in September 2019. The assault follows a recent escalation of hostilities in the Middle East region after Yemen’s Houthi rebels launched a series of attacks on Saudi Arabia. The new U.S. administration also carried out airstrikes in Syria last month on sites it said were connected with Iran-backed groups.

 

 
Intraday RESISTANCE LEVELS
9th March 2021 R1 R2 R3
GOLD-XAU 1,747 1,747 1,764-1,776
Silver-XAG 26.05-26.50 27.25 27.65-28.20
Crude Oil 65.40-66.00 66.70 67.50-68.00
EURO/USD 1.1925-1.1960 1.2015 1.2090-1.2150
GBP/USD 1.3900 1.3950 1.3990-1.4040
USD/JPY 109.00 109.90 110.50-111.00

Intraday SUPPORTS LEVELS
9th March 2021 S1 S2 S3
GOLD-XAU 1,695-1,684 1,675 1,655-1,643
Silver-XAG 25.40-24.90 24.10 23.60-23.00
Crude Oil 64.50 63.50-62.90 61.30
EURO/USD 1.1850-1.1810 1.1760 1.1705-1.1650
GBP/USD 1.3865-1.3747 1.3700 1.3650-1.3565
USD/JPY 108.50-108.00 107.50 106.90-106.10

Intra-Day Strategy (9th March 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 Monday made its intraday high of US$1714.20/oz and low of US$1676.75/oz. Gold down 1.049% at US$1683.29/oz.

Technicals in Focus:

In daily charts, prices are below 200DMA (1858) 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 1690-1643 with risk below 1643, targeting 1715-1730-1747 and 1764-1776-1787. Sell below 1715-1776 keeping stop loss closing above 1776, targeting 1700-1684-1675 and 1675-1650.

 
Intraday Support Levels
S1     1,695-1,684
S2     1,675
S3     1,655-1,643
Intraday Resistance Levels
R1     1,747
R2     1,747
R3     1,764-1,776

Technical Indicators

Name   Value Action
14DRSI  

27.752

Buy
20-DMA   1779.87 Sell
50-DMA  

1829.00

Sell
100-DMA   1848.88 Sell
200-DMA   1858.18 Sell
STOCH(5,3)   10.503 Sell
MACD(12,26,9)   -34.276 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$25.91/oz and low of US$24.93/oz settled down by 0.841% at US$25.11/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (25.40), 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 26.05-29.50 with stop loss above 30.00; targeting 25.05-24.45 and 24.00-23.50-23.00. Buy silver in between 25.05-23.60, targeting 26.05-26.50-27.25 and 28.20-28.90-29.50 with stop loss should be place on the breakage below 24.60.

 
Intraday  Support Levels
S1     25.40-24.90
S2     24.10
S3     23.60-23.00

Intraday  Resistance Levels
R1     26.05-26.50
R2     27.25
R3     27.65-28.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.922 Buy
20-DMA   26.99 Sell
50-DMA   26.47 Sell
100-DMA   25.38 Sell
200-DMA   24.04 Buy
STOCH(5,3)   13.468 Sell
MACD(12,26,9)   -0.151 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US67.83/bbl, intraday low of US$64.45 /bbl and settled up by 3.08% to close at US$64.54/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 64.50-62.50 with risk daily closing below 62.50 and targeting 65.40-66.00-66.70 and 67.50-68.00-69.00. Sell in between 65.40-69.40 with stop loss at 69.40; targeting 64.50-62.90 and 63.50-61.40.

 
Intraday Support Levels
S1     64.50
S2     63.50-62.90
S3     61.30

Intraday Resistance Levels
R1     65.40-66.00
R2     66.70
R3     67.50-68.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   67.168 Sell
20-DMA   57.49 Buy
50-DMA   53.14 Buy
100-DMA   47.36 Buy
200-DMA   43.42 Buy
STOCH(5,3)   55.130 Sell
MACD(12,26,9)   2.447 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.1843/EUR, high of US$1.1931/EUR and settled the day down by 0.586% to close at US$1.1845/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.2028), which become immediate resistance level, break above will target 1.2090. MACD is above zero line and histograms are increasing mode which will bring bullish view. Stochastic is in oversold territory and still 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 1.850-1.1705 with risk below 1.1700, targeting 1.1900-1.2015-1.2090 and 1.2150-1.2190-1.2300. Sell below 1.1900-1.2190 targeting 1.1850-1.1800 and 1.1760-1.1705 with stop-loss at daily closing above 1.2340.

 
Intraday Support Levels
S1     1.1850-1.1810
S2     1.1760
S3     1.1705-1.1650

Intraday  Resistance Levels
R1     1.1925-1.1960
R2     1.2015
R3     1.2090-1.2150

TECHNICAL INDICATORS
Name   Value Action
14DRSI   33.812 Buy
20-DMA   1.2089 Sell
50-DMA   1.2130 Sell
100-DMA   1.2028 Sell
200-DMA   1.1809 Buy
STOCH(5,3)   14.758 Sell
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3799/GBP, high of US$1.3864/GBP and settled the day up by 0.126% to close at US$1.3820/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.3610) 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 1.3900-1.4200 with targets at 1.3865-1.3800-1.3745 and 1.3700-1.3650-1.3565 stop-loss should be 1.4200. Buy above 1.3865-1.3570 with targets 1.3900-1.3940-1.3990 and 1.4040-1.4100-1.4200 with stop loss closing below 1.3570.

 
Intraday Support Levels
S1     1.3865-1.3747
S2     1.3700
S3     1.3650-1.3565

Intraday Resistance Levels
R1     1.3900
R2     1.3950
R3     1.3990-1.4040

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

76.806

Buy
20-DMA   1.3839 Buy
50-DMA   1.3420 Buy
100-DMA   1.3420 Buy
200-DMA   1.3096 Buy
STOCH(5,3)   86.940 Buy
MACD(12,26,9)   0.0061 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY108.22/USD and made an intraday high of JPY108.93/USD and settled the day up by % at JPY108.83/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 109.00-111.00 with risk above 111.00 targeting 108.50-107.50-106.90 and 106.10-105.60-105.00. Long positions above 108.50-106.00 with targets of 109.00-109.90 and 110.50-111.00 with stop below 106.00.

 
Intraday Support Levels
S1     108.50-108.00
S2     107.50
S3     106.90-106.10

INTRADAY RESISTANCE LEVELS
R1     109.00
R2     109.90
R3     110.50-111.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   79.407 Buy
20-DMA   106.28 Sell
50-DMA   104.91 Sell
100-DMA   104.58 Sell
200-DMA   105.48 Sell
STOCH(9,6)   85.253 Sell
MACD(12,26,9)   0.986 Sell

AAFX TRADING
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