AAFX TRADING

Daily Market Lookup

  • The dollar weakened in early European trading Thursday, trading near two-week lows after minutes of the Federal Reserve's March policy meeting pointed - unsurprisingly - to continued loose monetary policy. The minutes for the U.S. central bank’s last meeting showed that the officials remained cautious about the country’s economic recovery from the ravages of the coronavirus pandemic, even while acknowledging that the recovery was gathering steam, and committed to monetary policy support until a rebound was more secure. Fed Chair Jerome Powell will speak at a virtual International Monetary Fund conference later on Thursday. Also weighing on the greenback has been the recent slide in bond yields. Although the benchmark 10-year Treasury yield last traded around 1.66%, after dipping below 1.63% during the previous session, this is still a far cry from the more than one-year high of above 1.77% late last month. The dollar's strong rally of the previous quarter was based on the idea that accelerating U.S. economic growth and inflation could force the Fed to abandon its pledge to keep interest rates near zero until 2024. While the Fed maintained its dovish stance, it did acknowledge that growth was expanding, and a quick look at the situation over in Europe with virus infections on the rise suggests that this competitive advantage is here to stay, at least for the next few months.
  • The U.S. dollar traded near more than two-week troughs versus major peers on Thursday, tracking Treasury yields lower, after minutes of the Federal Reserve's March policy meeting offered no new catalysts to dictate market direction. Fed officials remained cautious about the risks of the pandemic - even as the U.S. recovery gathered steam amid massive stimulus - and committed to pouring on monetary policy support until a rebound was more secure, the minutes showed Wednesday. Fed Chair Jerome Powell will speak at a virtual International Monetary Fund conference later on Thursday The chief currency strategist at Citigroup (NYSE:C) Global Markets Japan, Osamu Takashima, said that the market's direction is difficult to call, but expects the next move for the greenback to be lower. The Fed’s minutes from its March meeting failed to offer any new catalysts to dictate the market direction and remained cautious about the road to recovery from COVID-19. The central bank reiterated its pledge to continue monetary policy support for the economy until the recovery was on a more solid footing, even as unprecedented stimulus measure saw the U.S. recovery gather pace. However, some investors remained optimistic about the U.S. currency’s prospects. U.S. Treasury yields were also on investors’ minds as the benchmark 10-year Treasury yield hovered near 1.67% on Thursday after dipping below 1.63% during the previous session. Although the market's direction is difficult to call, Citigroup (NYSE:C) Global Markets Japan’s chief currency strategist Osamu Takashima expects the next move for the greenback to be lower.
  • Gold was down on Thursday morning in Asia, with investors turning to riskier assets after the U.S. Federal Reserve reiterated its continued policy support in its latest meeting minutes and boosted hopes for the economic recovery from COVID-19. The Fed’s minutes from its March meeting released on Wednesday emphasized the “highly uncertain” path to recovery, with the central bank not planning to scale back its massive bond-buying program until the recovery is further along the path. Officials also downplayed the risk of inflation from the recent surge in Treasury yields, insisting that the surge reflects stronger growth prospects. These comments in turn prompted investors to scale back their most-aggressive positioning for interest rates to start rising by the end of 2022. Meanwhile, Fed Chairman Jerome Powell will take part in a panel about the global economy later in the day. More U.S. stimulus could also be around the corner, with U.S. President Joe Biden appealing for U.S companies to foot a large part of the $2 trillion-plus bill for his infrastructure plan. However, he indicated a willingness to negotiate the exact amount to be paid. Helping to cap the yellow metal’s losses, however, was the dollar languishing near more than two-week lows on Thursday.
  • Oil was down Thursday morning in Asia, as an unexpected build in U.S. gasoline stocks raised concerns about weakening demand for crude in the world’s biggest oil consumer alongside rising stockpiles. U.S. crude oil supply data from the U.S. Energy Information Administration (EIA) showed a draw of 3.522 million barrels, against the 1.436-million-barrel draw in forecasts prepared by Investing.com and the 876,000-barrel-draw reported the week before Supply data from the American Petroleum Institute the day before showed a draw of 2.618 million barrels. The EIA data also said that gasoline inventories jumped to 4.044 million barrels, against the 221,000-barrel draw in forecasts prepared by Investing.com and the 1.735-million-barrel draw reported during the previous week. Some investors urged caution as refiners ramp up production ahead of the summer driving season. Meanwhile, global crude oil supply is also increasing as Russia reportedly increased its output from average March levels in the first few days of April. Iranian supply could also increase, as talks on reviving a nuclear deal with the U.S. and other countries continue and raise the possibility that some sanctions could be lifted. Investors continue to draw hope for fuel demand recovery, however, from the IMF’s prediction of better-than-expected global growth in 2021. The organization said earlier in the week that the unprecedented public spending deployed to combat COVID-19 could increase global growth to 6%, a rate that has not achieved since the 1970s. A rosier economic outlook would boost demand for the black liquid, in turn keeping stockpiles in check.

 

 
Intraday RESISTANCE LEVELS
8th April 2021 R1 R2 R3
GOLD-XAU 1,750-1,762 1,770 1,790-1,810
Silver-XAG 25.60 26.05 26.50-27.25
Crude Oil 59.25-60.50 62.00-62.55 62.00-62.55
EURO/USD 1.1850-1.1905 1.1960 1.2015-1.2100
GBP/USD 1.3800-1.3860 1.3900 1.3950-1.4010
USD/JPY 110.00-111.00 111.70 112.20-113.00

Intraday SUPPORTS LEVELS
8th April 2021 S1 S2 S3
GOLD-XAU 1,730-1,715 1,705 1,690-1,684
Silver-XAG 24.70-23.90 23.55 23.00-22.50
Crude Oil 58.25-57.20 56.50 55.90-54.00
EURO/USD 1.1800 1.1760 1.1705-1.1650
GBP/USD 1.3747 1.3700 1.3650-1.3600
USD/JPY 109.45-109.00 108.50 108.00-107.35

Intra-Day Strategy (8th April 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 Wednesday made its intraday high of US$1744.24/oz and low of US$1730.57/oz. Gold down 0.289% at US$1737.33/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 1730-1675 with risk below 1675, targeting 1743-1751 and 1770-1776. Sell below 1750-1776 keeping stop loss closing above 1776, targeting 1730-1715-1705 and 1684-1675.

 
Intraday Support Levels
S1     1,730-1,715
S2     1,705
S3     1,690-1,684
Intraday Resistance Levels
R1     1,750-1,762
R2     1,770
R3     1,790-1,810

Technical Indicators

Name   Value Action
14DRSI  

49.752

Buy
20-DMA   1726.62 Sell
50-DMA  

1766.69

Sell
100-DMA   1812.42 Sell
200-DMA   1857.00 Sell
STOCH(5,3)   91.503 Sell
MACD(12,26,9)   -11.276 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$25.26/oz and low of US$24.84/oz settled down by 0.103% 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 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 25.50-27.50 with stop loss above 27.50; targeting 24.70-24.45 and 23.90-23.50-23.00. Buy silver in between 24.70-22.60, targeting 26.05-26.50 and 27.25- 28.20-28.90 with stop loss should be place on the breakage below 24.60.

 
Intraday  Support Levels
S1     24.70-23.90
S2     23.55
S3     23.00-22.50

Intraday  Resistance Levels
R1     25.60
R2     26.05
R3     26.50-27.25

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.994 Buy
20-DMA   25.99 Sell
50-DMA   26.36 Sell
100-DMA   25.59 Sell
200-DMA   24.49 Buy
STOCH(5,3)   38.468 Buy
MACD(12,26,9)   -0.151 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US60.03/bbl, intraday low of US$58.13/bbl and settled up by 0.421% to close at US$59.53/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 58.25-56.00 with risk daily closing below 56.00 and targeting 59.25-60.50-61.25 and 62.00-62.55-63.50. Sell in between 58.25-54.70 with stop loss at 54.00; targeting 58.25-57.10-56.40 and 55.90-54.00.

 
Intraday Support Levels
S1     58.25-57.20
S2     56.50
S3     55.90-54.00

Intraday Resistance Levels
R1     59.25-60.50
R2     62.00-62.55
R3     62.00-62.55

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.168 Sell
20-DMA   62.56 Buy
50-DMA   58.37 Buy
100-DMA   51.51 Buy
200-DMA   45.93 Buy
STOCH(5,3)   18.130 Sell
MACD(12,26,9)   1.188 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday an intraday low of US$1.1860/EUR, high of US$1.1914/EUR and settled the day down by 0.0732% to close at US$1.1864/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 1.1850-1.1600 with risk below 1.1600, targeting 1.1905-1.1960 and 1.2015-1.2090-1.2150. Sell below 1.1850-1.2090 targeting 1.1800-1.1760-1.1705 and 1.1650-1.1600 with stop-loss at daily closing above 1.2100.

 
Intraday Support Levels
S1     1.1800
S2     1.1760
S3     1.1705-1.1650

Intraday  Resistance Levels
R1     1.1850-1.1905
R2     1.1960
R3     1.2015-1.2100

TECHNICAL INDICATORS
Name   Value Action
14DRSI   34.812 Buy
20-DMA   1.1922 Sell
50-DMA   1.2032 Sell
100-DMA   1.2049 Sell
200-DMA   1.1857 Buy
STOCH(5,3)   5.758 Sell
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3723/GBP, high of US$1.3839/GBP and settled the day down by 0.6222% to close at US$1.3733/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 1.3800-1.4080 with targets at 1 1.3745-1.3700 and 1.3650-1.3600-1.3565 stop-loss should be 1.3950. Buy above 1.3860-1.3520 with targets 1.3865-1.3900 and 1.3940-1.3990 with stop loss closing below 1.3520.

 
Intraday Support Levels
S1     1.3747
S2     1.3700
S3     1.3650-1.3600

Intraday Resistance Levels
R1     1.3800-1.3860
R2     1.3900
R3     1.3950-1.4010

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

43.806

Buy
20-DMA   1.3820 Buy
50-DMA   1.3852 Buy
100-DMA   1.3672 Buy
200-DMA   1.3314 Buy
STOCH(5,3)   21.940 Sell
MACD(12,26,9)   -0.0022 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY109.57/USD and made an intraday high of JPY109.93/USD and settled the day up by 0.106% at JPY109.84/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 111.00-113.50 with risk above 113.50 targeting 110.50-109.50-108.50 and 108.00-107.50-106.90. Long positions above 110.50-108.00 with targets of 111.00-111.70-112.20 and 113.00-113.50 with stop below 106.00.

 
Intraday Support Levels
S1     109.45-109.00
S2     108.50
S3     108.00-107.35

INTRADAY RESISTANCE LEVELS
R1     110.00-111.00
R2     111.70
R3     112.20-113.00

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

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