AAFX TRADING

Daily Market Lookup

  • The dollar was up on Monday morning in Asia over worries triggered by fresh COVID-19 outbreaks in some Asian countries. However, investors are heavily positioning for a fall in the U.S. currency as the U.S. Federal Reserve sticks to its current dovish policy. However, the pound was near a two-and-a-half-month high as the U.K. reopens its economy after a four-month lockdown. The greenback was boosted by easing commodity prices and the COVID-19 outbreaks in Singapore and Taiwan, where there were a record 206 new cases, with both countries tightening restrictive measures. Singaporean primary, secondary, junior college and Millennia Institute students shifted to full home-based learning from May 19 till the end of the school term on May 28. However, a bounce from higher-than-expected U.S. inflation data released during the previous week faded over mounting investor expectations that the Fed will keep interest rates low Investors are also looking to the Fed’s minutes from its April meeting, due to be released on Wednesday, for further clues on the central bank’s next steps. Investors increased bets against the dollar during the previous week, mostly turning towards the euro and pound to a lesser extent, as Europe and the U.K. continue their path towards economic recovery.
  • The U.S. dollar was supported on Monday amid renewed worries about coronavirus restrictions in Asia, but investors are heavily positioned for it to fall while the U.S. Federal Reserve keeps rates low Bitcoin skidded to a three-month low after Tesla Inc boss Elon Musk suggested at the weekend that the car maker is considering selling or may have already sold some of its holdings in the cryptocurrency. Easing commodity prices and fresh virus outbreaks in Singapore and Taiwan - where COVID-19 had been contained - helped modest dollar gains of 0.3% against the Australian dollar and 0.4% versus the New Zealand dollar. The greenback was little changed against the euro and the yen, but it remained close to testing major support levels, which if broken could see a return to a downtrend that pressed it lower through April. A dollar bounce that followed higher-than-expected inflation data last week has also faded as traders figure the U.S. Federal Reserve will keep rates low. Fed minutes, from an April meeting that predated the data surprise on inflation last week, are due on Wednesday and are the next market focus for clues on the central bank's thinking. Cryptocurrencies traded under pressure after another weekend bouncing around following a tweet from Tesla's Musk suggesting the company is possibly selling its bitcoin holdings. Speculators increased their bets against the dollar last week, mostly by adding to bets on the euro and to a lesser extent sterling as Britain and Europe head toward recovery. Sterling was perched near a two-and-a-half-month high on Monday, at $1.4086, as Britain reopens its economy after a four-month COVID lockdown. Things are travelling in the opposite direction in Asia where some early leaders in taming the pandemic are now dealing with new outbreaks. Singapore and Taiwan have both tightened curbs as cases rise, which weighed on the Singapore dollar, while the Taiwan dollar fell to a three-week low on Monday.The onshore yuan was little changed at 6.4380 per dollar after a mixed round of economic data showed China's industrial output had slowed and retail sales missed forecasts last month.
  • Gold was up on Monday morning in Asia, climbing to a three-month high as inventors digested disappointing economic data from China and the U.S. The dollar, which usually moves inversely to gold, inched up on Monday and the benchmark 10-year U.S. Treasury yield came down further from a more than one-month high hit during the previous week. Chinese data released earlier in the day said that industrial production growth slowed down to 9.8% year-on-year in April. In the U.S., data released on Friday said that retail sales did not grow month-on-month in April as the bounce from stimulus checks distributed earlier in the year faded. However, an acceleration could be forthcoming in the coming months as savings surge to record levels and the economy continues to re-open.The weak U.S. data did help to calm rising worries about runaway inflation and bets that the U.S. Federal Reserve would hike interest rates sooner than expected Dallas Fed President Robert Kaplan on Friday warned of a worrisome rise in U.S. inflation expectations, as imbalances between supply and demand for labor and goods put upward pressure on prices. However, Cleveland Fed President Loretta Mester said that the Fed’s policy is currently in a good place Other officials from the central bank, including Fed Vice Chair Richard Clarida and Atlanta Fed President Raphael Bostic, will also speak later in the week. Investors now await the minutes from the U.S. Federal Reserve’s latest meeting, due on Wednesday, with the Reserve Bank of Australia publishing its own minutes the day before.
  • Oil was up on Monday morning in Asia as investors are optimistic about the recovery of fuel demand in key markets, despite concerns over the COVID-19 resurgence in parts of Asia. Crude demand is increasing as the U.S. and parts of Europe continue their economic recovery from COVID-19 thanks to an accelerating COVID-19 vaccination rate. In the U.K., the government said on Sunday that more than 20 million people, or 38% of the British adult population, have been fully vaccinated against COVID-19. On the supply front, pump stations in the U.S. are restarting to supply gasoline as Colonial Pipeline is slowly restarting its entire pipeline system after being hit by a cyber-attack earlier in the month. Meanwhile, U.S. energy firms added oil and natural gas rigs for three consecutive weeks due to higher crude prices, energy services firm Baker Hughes Co. said on Friday. However, parts of Asia, including Singapore and Taiwan, are seeing new outbreaks of COVID-19 cases. Meanwhile, Japan on Friday further expanded a COVID-19 state of emergency before the beginning of the Tokyo Olympics in July and some Indian states said on Sunday that they would extend COVID-19 restrictions. Data from China, the world’s biggest oil importer, released earlier in the day also disappointed as the country's industrial production growth slowed down to 9.8% year-on-year in April. Across the Middle East, Israel and Palestinians’ conflict moved into its second week, with no clear end in sight to the violence. Some Indian states said on Sunday they would extend COVID-19 lockdowns to help contain the pandemic, which has killed more than 270,000 people in the country. There are fears that the nation's annual budget may fall flat as it did not account for a crippling second wave of COVID-19 infections. Singapore warned on Sunday that new coronavirus variants were affecting more children, as the city-state prepares to shut most schools from this week, while Japan has declared a state of emergency in three more prefectures hit hard by the pandemic Disappointing retail data from China also added to pressure, Rakuten's Yoshida said. China's retail sales significantly missed expectations as officials warned of new problems affecting the recovery in the world's second-largest economy. China's crude oil throughput rose 7.5% in April from the same month a year ago, but remained off the peak seen in the last quarter of 2020.

 

 
Intraday RESISTANCE LEVELS
17th May 2021 R1 R2 R3
GOLD-XAU 1,854-1,860 1,865 1,874-1,880
Silver-XAG 27.90-28.50 28.90 29.50-30.10
Crude Oil 65.90-66.40 67.00 67.85-68.50
EURO/USD 1.2200 1.2240-1.2300 1.2350
GBP/USD 1.4180-1.4240 1.4300 1.4360-1.4400
USD/JPY 109.70-110.20 110.90 111.70-112.50

Intraday SUPPORTS LEVELS
17th May 2021 S1 S2 S3
GOLD-XAU 1,844-1,824 1,816 1,803-1,795
Silver-XAG 27.25-26.55 26.00 27.90-28.50
Crude Oil 65.30-64.55 63.70 62.70-62.00
EURO/USD 1.2140-1.2070 1.2010 1.1960-1.1905
GBP/USD 1.4090-1.4065 1.4010 1.3900-1.3800
USD/JPY 109.00-108.50 107.50 107.00-106.50

Intra-Day Strategy (17th May 2021)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Buy
EUR/USD Neutral to Sell
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Friday made its intraday high of US$1845.80/oz and low of US$1819.62/oz. Gold up 0.903% at US$1843.13/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 1844-1795 with risk below 1795, targeting 1854-1860 and 1872-1880. Sell below 1860-1880 keeping stop loss closing above 1880, targeting 1844-1824-1816 and 1803- 1790.

 
Intraday Support Levels
S1     1,844-1,824
S2     1,816
S3     1,803-1,795
Intraday Resistance Levels
R1     1,854-1,860
R2     1,865
R3     1,874-1,880

Technical Indicators

Name   Value Action
14DRSI  

65.752

Buy
20-DMA   1782.15 Buy
50-DMA  

1796.61

Buy
100-DMA   1796.61 Buy
200-DMA   1851.57 Sell
STOCH(5,3)   88.503 Buy
MACD(12,26,9)   12.276 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$27.47/oz and low of US$26.80/oz settled up by 0.0113% at US$27.39/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 27.90-30.10 with stop loss above 30.10; targeting 27.25-26.55-26.00 and 25.60-24.70-24.45. Buy silver in between 27.25-25.00, targeting 27.90-28.35 and 28.90-29.50 with stop loss should be place on the breakage below 25.00.

 
Intraday  Support Levels
S1     27.25-26.55
S2     26.00
S3     27.90-28.50

Intraday  Resistance Levels
R1     27.90-28.50
R2     28.90
R3     29.50-30.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   68.037 Buy
20-DMA   26.28 Sell
50-DMA   25.79 Sell
100-DMA   26.12 Sell
200-DMA   25.59 Buy
STOCH(5,3)   90.468 Buy
MACD(12,26,9)   0.436 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US65.54/bbl, intraday low of US$63.33/bbl and settled up by 2.575% to close at US$65.43/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 65.30-62.00 with risk daily closing below 62.00 and targeting 66.40-67.00 and 67.80-68.50-69.20. Sell in between 65.40-69.20 with stop loss at 69.20; targeting 64.55-63.70 and 62.90-62.00-61.45.

 
Intraday Support Levels
S1     65.30-64.55
S2     63.70
S3     62.70-62.00

Intraday Resistance Levels
R1     65.90-66.40
R2     67.00
R3     67.85-68.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.168 Sell
20-DMA   63.35 Buy
50-DMA   62.30 Buy
100-DMA   58.16 Buy
200-DMA   49.79 Buy
STOCH(5,3)   51.130 Buy
MACD(12,26,9)   1.097 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday an intraday low of US$1.2070/EUR, high of US$1.2149/EUR and settled the day up by 0.583% to close at US$1.2149/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 Sell

Sell below 1.2200-1.2350 targeting 1.2070-1.2010-1.1960 and 1.1905-1.1800-1.1760 with stop-loss at daily closing above 1.2400. Buy above 1.2140-1.1800 with risk below 1.1800, targeting 1.2200-1.2240 and 1.2300-1.2350.

 
Intraday Support Levels
S1     1.2140-1.2070
S2     1.2010
S3     1.1960-1.1905

Intraday  Resistance Levels
R1     1.2200
R2     1.2240-1.2300
R3     1.2350

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.621 Buy
20-DMA   1.2050 Buy
50-DMA   1.1948 Buy
100-DMA   1.2047 Buy
200-DMA   1.1946 Buy
STOCH(5,3)   86.758 Buy
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.4035/GBP, high of US$1.4110/GBP and settled the day up by 0.3445% to close at US$1.1.4097/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 1.4180-1.4360 with targets at 1.4100-1.4065-1.4010 and 1.3900-1.3800-1.3745 stop-loss should be 1.4360. Buy above 1.4100-1.3700 with targets 1.4180-1.4240 and 1.4300-1.4360 with stop loss closing below 1.3700.

 
Intraday Support Levels
S1     1.4090-1.4065
S2     1.4010
S3     1.3900-1.3800

Intraday Resistance Levels
R1     1.4180-1.4240
R2     1.4300
R3     1.4360-1.4400

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

65.806

Buy
20-DMA   1.3892 Buy
50-DMA   1.3858 Buy
100-DMA   1.3785 Buy
200-DMA   1.3447 Buy
STOCH(5,3)   82.940 Sell
MACD(12,26,9)   -0.0022 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY109.17/USD and made an intraday high of JPY109.65/USD and settled the day down by 0.173% at JPY109.27/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

Long positions above 109.00-106.50 with targets of 109.70-110.20 and 110.90-111.70-112.20 with stop below 106.00. Sell below 109.70-112.50 with risk above 112.50 targeting 109.00-108.50-108.00 and 107.50-106.90.

 
Intraday Support Levels
S1     109.00-108.50
S2     107.50
S3     107.00-106.50

INTRADAY RESISTANCE LEVELS
R1     109.70-110.20
R2     110.90
R3     111.70-112.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.407 Buy
20-DMA   109.48 Sell
50-DMA   107.72 Sell
100-DMA   105.79 Sell
200-DMA   105.70 Sell
STOCH(9,6)   31.253 Sell
MACD(12,26,9)   0.508 Sell

AAFX TRADING
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