AAFX TRADING

Daily Market Lookup

  • The dollar was up on Wednesday morning in Asia, with other major currencies holding tight ranges ahead of the U.S. Federal Reserve’s policy decision later in the day. The index has risen for the past three sessions, boosted by U.S. bond yields that are climbing as expectations of a strong economic recovery grow. The Fed decision is widely expected to match the rosy view, with investors watching for any indications the central bank could start rate hikes earlier or let bond yields rise further. Fed Chairman Jerome Powell is expected to forecast that the U.S. economy will grow in 2021 at the fastest rate in decades, as the COVID-19 vaccination rollout gathers pace and U.S. households start to benefit from a $1.9 trillion stimulus package signed into law during the previous week. The more pertinent question for investors is whether the Fed will give any inclination to start raising interest rates in 2023, earlier than it has previously said. Such a move could drive a further rally in the dollar. The Bank of England and the Bank of Japan will hand their own decisions down on Thursday and Friday respectively. The euro was at $1.1903, after its downward trend over the last three days, with Sweden and Latvia the latest countries to suspend usage of the AstraZeneca PLC (LON:AZN)/University of Oxford COVID-19 vaccine over potential side effects concerns. The growing list of countries doing the same is dealing a further blow to Europe’s vaccine rollout. The European Medicines Agency will release the results of its side effects investigation on Thursday. The dollar maintained a strong tone in early European trading Wednesday, as traders looked forward to the conclusion of the two-day Federal Reserve meeting for guidance on future monetary policies. The Federal Reserve concludes its two-day policy meeting later Wednesday, and is expected to update its economic forecasts to predict stronger U.S. economic growth in the wake of a ramped-up Covid-19 vaccination program and $1.9 trillion in new stimulus. That said, “a substantial shift in tone by the FOMC appears unlikely and markets will probably remain unfussed by a mere reiteration of the “lower-for-longer” (and QE for longer) pledge despite improved recovery prospects,” said analysts at ING, in a research note. Traders will also be looking to see whether the Fed will give any inclination to start raising interest rates in 2023, earlier than it has previously said. Late Tuesday, French Prime Minister Jean Castex said his country had entered a third wave of the Covid-19 pandemic, as the seven-day average of new cases rose above 25,000 for the first time since late November. The bank is expected to do so to stem a slide in the currency that’s pushing inflation higher, driven, at least in part, by the amount the country has spent trying to shield its economy from the effects of the pandemic.
  • The U.S. dollar held gains against major currencies on Wednesday as investors looked to the U.S. Federal Reserve's policy meeting for indications it could start rate hikes earlier or let bond yields rise further. With Fed policymakers expected to forecast the fastest U.S. economic growth in decades in the wake of COVID-19 vaccinations and $1.9 trillion in new stimulus, market participants will be focused on cues that the central bank could start raising interest rates in 2023, earlier than it had said. Europe's medicines watchdog will release results of its investigation into incidents of bleeding, blood clots and low platelet counts in recipients of AstraZeneca (NASDAQ:AZN)'s coronavirus vaccine on Thursday afternoon. The British pound was down about 0.1% at $1.3886 in Asian trading on Wednesday. The currency has come under pressure from profit-taking after it hit a near three-year high last month on the back of a fast vaccine roll-out.
  • Trading in oil futures is now as heavy as it was in the first months of the COVID-19 crisis, according to market data and analysts, with oil bulls and bears rushing to hedge against jolts in the steady rise of prices. But speculation over when and if people will begin to travel and commute as they once did is driving dueling bets in the market and historic volumes of trade Total monthly contracts for U.S. WTI crude held by producers and merchants increased to more than 1 million in February for the first time since May, according to the U.S. Commodity Futures Trading Commission. Meanwhile, market open interest in ICE (NYSE:ICE)'s Brent futures contract reached an all-time high of 2.8 million contracts on Feb. 19, topping its last record in April last year. Open interest refers to a trader's position in the market, long or short, and reflects their sentiment over future value. Oil market participants engage in futures trading to mitigate risks by price changes to their business - producers generally use short positions to protect themselves from price plunges while consumers use longs to hedge against increases. The recent surge in oil prices encouraged both producers and consumers to wade into the market with their competing bets, the U.S. Energy Information Administration (EIA) said. Underscoring the instability is a disconnect between the four-month surge in the futures price and slow physical crude sales - with global demand expected to match supply only later in 2021. A solid return for global demand may be the only exit from the market's bumpiest-ever periods. Price volatility from the close of one trading day to the next last March hit highs last seen in the Gulf War, and the current highs are the highest since November. "This time, what is different is the dramatic decrease in consumer and commercial demand", said Gianna Bern, finance professor at the University of Notre Dame in Indiana. Oil prices climbed on Wednesday as investors weighed a recovery in U.S. refinery activity as industry data showed U.S. crude stockpiles unexpectedly fell last week against concerns of rocky demand in Europe. U.S. crude inventories fell by 1 million barrels in the week to March 12, according to trading sources citing data from the American Petroleum Institute. Analysts in a Reuters poll had expected a build of 3 million barrels. The narrower weekly draw in gasoline stocks signalled that refiner activity was normalising after a big freeze in Texas smothered production in the previous month, Innes said in a note. The historic icy spell in the southern U.S. states knocked out nearly a quarter of the country's refining capacity last month. Traders will be looking for confirmation of the drawdown in crude stocks in official data due from the Energy Information Administration due on Wednesday. Investors are also looking to the results of the U.S. central bank's Federal Open Market Committee (FOMC), which ends its two-day meeting on Wednesday, for indications on the direction of monetary policy. Trading in oil futures is now as heavy as it was in the first months of the COVID-19 crisis with oil bulls and bears rushing to hedge against jolts in prices. While demand is growing in India and the United States, it remains weak in Europe, ANZ said in a research note, noting France's road fuel consumption fell 10.8% in February from a year earlier, according to the country's petroleum industry federation.

 

 
Intraday RESISTANCE LEVELS
17th March 2021 R1 R2 R3
GOLD-XAU 1,730-1742 1,751 1,764-1,776
Silver-XAG 26.05-26.50 27.25 27.65-28.20
Crude Oil 66.00-66.70 67.50 68.00
EURO/USD 1.1925-1.1960 1.2015 1.2090-1.2150
GBP/USD 1.3950 1.3990 1.4040-1.4090
USD/JPY 109.40 109.90 110.50-111.00

Intraday SUPPORTS LEVELS
17th March 2021 S1 S2 S3
GOLD-XAU 1,715-1,705 1,684 1,675-1,655
Silver-XAG 25.40-24.90 24.10 23.60-23.00
Crude Oil 65.20-64.70 63.50 62.55-62.00
EURO/USD 1.1850 1.1810 1.1760-1.1705
GBP/USD 1.3865-1.3800 1.3747 1.3700-1.3650
USD/JPY 108.50-108.00 107.50 106.90-106.10

Intra-Day Strategy (17th 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 Tuesday made its intraday high of US$1741.05/oz and low of US$1726.03/oz. Gold up 0.008% at US$1731.07/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 overbought territory and giving positive crossover to bullish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1715-1643 with risk below 1643, targeting 1730-1743-1751 and 1764-1776-1787. Sell below 1730-1776 keeping stop loss closing above 1776, targeting 1700-1684-1675 and 1675-1650.

 
Intraday Support Levels
S1     1,715-1,705
S2     1,684
S3     1,675-1,655
Intraday Resistance Levels
R1     1,730-1742
R2     1,751
R3     1,764-1,776

Technical Indicators

Name   Value Action
14DRSI  

41.752

Buy
20-DMA   1743.11 Sell
50-DMA  

1803.70

Sell
100-DMA   1835.31 Sell
200-DMA   1858.86 Sell
STOCH(5,3)   79.503 Buy
MACD(12,26,9)   -34.276 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$26.29/oz and low of US$25.82/oz settled up by 1.057% at US$25.92/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 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 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   45.364 Buy
20-DMA   26.66 Sell
50-DMA   26.43 Sell
100-DMA   25.44 Sell
200-DMA   24.24 Buy
STOCH(5,3)   79.468 Buy
MACD(12,26,9)   -0.151 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US65.44/bbl, intraday low of US$63.84/bbl and settled down by 0.564% to close at US$64.95/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 65.40-62.00 with risk daily closing below 62.00 and targeting 66.00-66.70-67.50 and 68.00-69.00. Sell in between 65.90-69.00 with stop loss at 69.00; targeting 65.40-64.70-63.50 and 62.90-62.00-61.40.

 
Intraday Support Levels
S1     65.20-64.70
S2     63.50
S3     62.55-62.00

Intraday Resistance Levels
R1     66.00-66.70
R2     67.50
R3     68.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.168 Sell
20-DMA   62.34 Buy
50-DMA   57.12 Buy
100-DMA   50.32 Buy
200-DMA   45.32 Buy
STOCH(5,3)   55.130 Sell
MACD(12,26,9)   2.196 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.1881/EUR, high of US$1.1951/EUR and settled the day down by 0.2196% to close at US$1.1900/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 neutral territory and still 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 1.1925-1.1705 with risk below 1.1700, targeting 1.1960-1.2015-1.2090 and 1.2150-1.2190-1.2300. Sell below 1.1960-1.2190 targeting 1.1925-1.1850-1.1800 and 1.1760-1.1705 with stop-loss at daily closing above 1.2340.

 
Intraday Support Levels
S1     1.1850
S2     1.1810
S3     1.1760-1.1705

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.812 Buy
20-DMA   1.2043 Sell
50-DMA   1.2098 Sell
100-DMA   1.2035 Sell
200-DMA   1.1828 Buy
STOCH(5,3)   66.758 Buy
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3808/GBP, high of US$1.3905/GBP and settled the day down by 0.0661% to close at US$1.3891/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 1.3865-1.4200 with targets at 1.3800-1.3745 and 1.3700-1.3650-1.3565 stop-loss should be 1.4200. Buy above 1.3800-1.3570 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     1.3865-1.3800
S2     1.3747
S3     1.3700-1.3650

Intraday Resistance Levels
R1     1.3950
R2     1.3990
R3     1.4040-1.4090

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

56.806

Buy
20-DMA   1.3943 Buy
50-DMA   1.3775 Buy
100-DMA   1.3521 Buy
200-DMA   1.3184 Buy
STOCH(5,3)   86.940 Buy
MACD(12,26,9)   0.0061 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY109.28/USD and made an intraday high of JPY109.28/USD and settled the day down by 0.1337% at JPY108.99/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 109.40-111.00 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     109.40
R2     109.90
R3     110.50-111.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   77.407 Buy
20-DMA   106.48 Sell
50-DMA   105.01 Sell
100-DMA   104.61 Sell
200-DMA   105.48 Sell
STOCH(9,6)   83.253 Sell
MACD(12,26,9)   1.025 Sell

AAFX TRADING
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