AAFX TRADING

Daily Market Lookup

  • The U.S. dollar found support on Tuesday as investors prepared for U.S. inflation data due later in the week following weaker-than-expected jobs data, which has eased concerns about early tapering of the Federal Reserve's monetary stimulus. The euro fell, weakened by the dollar's strength and data showing German industrial production numbers declined in April. Currency markets were generally in a holding pattern ahead of Thursday, when the European Central Bank meets and U.S. inflation numbers are published. The dollar has weakened in 2021 but the drop has paused in recent weeks as investors try to make sense of where U.S. monetary policy is headed. The Federal Reserve also meets next week, giving investors further reason to sit on the sidelines for now. With recent trading channels tight, implied volatilities on both currencies have dropped to their lowest levels since early 2020, before markets were pummelled by the COVID-19 pandemic.
  • The dollar edged higher in early European trade Tuesday, but activity remains subdued ahead of this week’s key U.S. inflation release after Friday’s lackluster payrolls number. Friday’s U.S. nonfarm payrolls release showed an increase of 559,000 jobs last month after a revised 278,000 gain in April, below the 650,000 gain expected. While this softer-than-expected release eased the immediate pressure on the Federal Reserve to rein in its ultra-easy monetary policies, there still remain concerns that the central bank will shortly start discussing tapering asset purchases given the high levels of inflation. This view was reinforced by comments from U.S. Treasury Secretary Janet Yellen over the weekend that higher interest rates, and higher inflation levels, would be good for the economy. With this in mind, investors are now looking to consumer price data on Thursday for fresh direction, one of the last major pieces of economic data ahead of the next Fed meeting on June 15-16. Euro-area inflation is running at 2%, marginally above the ECB’s goal but a far cry from the levels seen across the Atlantic, and gross domestic product is seen growing 4.3%, only reaching its pre-crisis level next year.
  • Gold was down on Tuesday morning in Asia, hovering just below the $1,900 mark as investors await further clues later in the week to gauge inflationary pressure. Investors await the U.S. consumer price index report, due out on Friday, that could indicate the Federal Reserve’s next policy move. The Fed will meet to hand down its policy decision in the following week. The European Central Bank will hand down its own policy decision ahead of the Fed on Thursday, with both decisions to be scrutinized for any hints of asset tapering. On the data front, Japan’s GDP contracted 1% quarter-on-quarter for the first quarter of 2021, according to data released earlier in the day. The contraction was smaller than the 1.2% contraction in forecasts prepared by Investing.com but was lower than the previous quarter’s 2.8% growth.
  • Oil prices extended losses on Tuesday on profit taking and a stronger U.S. dollar, but overall optimism about strong demand recovery kept a floor under prices. As oil is priced in dollars, a stronger greenback makes crude more expensive for buyers with other currencies. Also weighing on prices was data showing China's crude imports were down 14.6% in May on a yearly basis Heavy Chinese refinery maintenance in May also contributed to the decline. Crude prices have risen in recent weeks, with Brent up by nearly 40% this year and WTI gaining even more, amid expectations of demand returning as some countries succeed in vaccinating populations against COVID-19. Restraint on supply by the Organization of the Petroleum Exporting Countries and allies has also helped buttress prices. In Britain, one of the most vaccinated countries in the world, there are now doubts that the country will lift all coronavirus-related restrictions as previously planned on June 21. Investor worries were heightened by trade data from China, the world’s top oil importer, released on Monday. Imports grew 51.1% year-on-year in May, below the 51.5% in forecasts prepared by Investing.com but higher than April’s 43.1% growth. Investors also await the outcome of talks between Iran and world powers to revive a 2015 nuclear deal and potentially re-add Iranian crude to the global supply. Discussions are scheduled to resume in Vienna on Jun. 10. The black liquid has seen a rally in recent weeks, with Brent futures climbing almost 40% in the year to date. Fuel demand optimism grew as some countries saw falling numbers of COVID-19 cases and rolled out vaccination programs. Also boosting prices was the Organization of the Petroleum Exporting Countries and allies (OPEC+)’s reiterated decision to keep supply restrained at its meeting earlier in the month. However, the optimism has been dampened by waves of COVID-19 cases in countries such as India, the world’s third-largest oil importer. Investors now await crude oil supply data from the American Petroleum Institute, due later in the day.

 

 
Intraday RESISTANCE LEVELS
8th June 2021 R1 R2 R3
GOLD-XAU 1,900-1,910 1,920 1,929-1,940
Silver-XAG 27.90-28.50 28.90 29.50-30.10
Crude Oil 69.30 69.70-70.50 71.00
EURO/USD 1.2190-1.2240 1.2300 1.2350-1.2400
GBP/USD 1.4200 1.4240 1.4300-1.4360
USD/JPY 110.20-110.90 111.70 112.50-113.00

Intraday SUPPORTS LEVELS
8th June 2021 S1 S2 S3
GOLD-XAU 1,884-1,876 1,865 1,856-1,845
Silver-XAG 27.55-27.25 26.55 26.00-25.60
Crude Oil 68.50-67.90 67.00 66.10-65.30
EURO/USD 1.2140-1.2100 1.2070 1.2010-1.1950
GBP/USD 1.4140-1.4090 1.4065 1.4010-1.3900
USD/JPY 109.50-109.00 108.50 107.50-107.00

Intra-Day Strategy (8th June 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 Monday made its intraday high of US$1900.01/oz and low of US$1881.41/oz. Gold up 0.411% at US$1881.41/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1843) and breakage below will call for 1800. MACD is above zero line and histograms are also increasing trend and it will bring upward stance in the upcoming sessions. RSI is in overbought region and more upside is expected before it gets stretched. Stochastic Oscillator is in overbought 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 1890-1845 with risk below 1845, targeting 1900-1910-1920 and 1929-1940. Sell below 1900-1940 keeping stop loss closing above 1940, targeting 1884-1876-1864 and 1856-1845-1836.

 
Intraday Support Levels
S1     1,884-1,876
S2     1,865
S3     1,856-1,845
Intraday Resistance Levels
R1     1,900-1,910
R2     1,920
R3     1,929-1,940

Technical Indicators

Name   Value Action
14DRSI  

61.420

Buy
20-DMA   1873.61 Buy
50-DMA  

1805.67

Buy
100-DMA   1795.01 Buy
200-DMA   1842.37 Buy
STOCH(5,3)   45.503 Sell
MACD(12,26,9)   26.276 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$27.83/oz and low of US$27.21/oz settled up by 1.173% at US$27.75/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 and 26.00-25.60-24.70. Buy silver in between 27.55-25.00, targeting 28.35-28.90 and 29.50-30.10 with stop loss should be place on the breakage below 25.00.

 
Intraday  Support Levels
S1     27.55-27.25
S2     26.55
S3     26.00-25.60

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.037 Buy
20-DMA   27.46 Buy
50-DMA   26.26 Buy
100-DMA   26.30 Buy
200-DMA   25.68 Buy
STOCH(5,3)   56.468 Buy
MACD(12,26,9)   0.436 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$69.82/bbl, intraday low of US$68.76/bbl and settled down by 0.378% to close at US$69.04/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 20DMA i.e. 65.09 which is a support level and breakage below will call for 62.70. 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; sell in between 69.30-71.70 with stop loss at 71.70; targeting 68.50-67.90-67.00 and 66.10-65.30-64.70. Buy above 68.50-65.70 with risk daily closing below 65.70 and targeting 69.00 and 69.70-70.50-71.00.

 
Intraday Support Levels
S1     68.50-67.90
S2     67.00
S3     66.10-65.30

Intraday Resistance Levels
R1     69.30
R2     69.70-70.50
R3     71.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.168 Sell
20-DMA   65.88 Buy
50-DMA   63.57 Buy
100-DMA   61.24 Buy
200-DMA   52.05 Buy
STOCH(5,3)   88.130 Buy
MACD(12,26,9)   1.831 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.2144/EUR, high of US$1.2201/EUR and settled the day up by 0.280% to close at US$1.2188/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.2143), which become immediate Support 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 Sell

Sell below 1.2170-1.2490 targeting 1.2100-1.2070 and 1.2010-1.1960-1.1905 with stop-loss at daily closing above 1.2490. Buy above 1.2140-1.1900 with risk below 1.1900, targeting 1.2240-1.2300-1.2350 and 1.2400-1.2490.

 
Intraday Support Levels
S1     1.2140-1.2100
S2     1.2070
S3     1.2010-1.1950

Intraday  Resistance Levels
R1     1.2190-1.2240
R2     1.2300
R3     1.2350-1.2400

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.621 Buy
20-DMA   1.2175 Buy
50-DMA   1.2047 Buy
100-DMA   1.2039 Buy
200-DMA   1.1980 Buy
STOCH(5,3)   36.758 Sell
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.4110/GBP, high of US$1.4190/GBP and settled the day up by 0.246% to close at US$1.4179/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.4079) 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 neutral territory and giving positive crossover to confirm bullish 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 1.4150-1.4490 with targets at 1.4100-1.4065 and 1.4010-1.3900-1.3800 stop-loss should be 1.4360. Buy above 1.4150-1.3900 with targets 1.4200-1.4240-1.4300 and 1.4360-1.4400 with stop loss closing below 1.3700.

 
Intraday Support Levels
S1     1.4140-1.4090
S2     1.4065
S3     1.4010-1.3900

Intraday Resistance Levels
R1     1.4200
R2     1.4240
R3     1.4300-1.4360

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

61.806

Buy
20-DMA   1.4079 Buy
50-DMA   1.3923 Buy
100-DMA   1.3869 Buy
200-DMA   1.3520 Buy
STOCH(5,3)   56.940 Buy
MACD(12,26,9)   0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY109.18/USD and made an intraday high of JPY109.63/USD and settled the day down 0.264% at JPY109.23/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 109.50-106.50 with targets of 109.70-110.20 and 110.90-111.70-112.20 with stop below 106.00. Sell below 110.20-112.50 with risk above 112.50 targeting 109.00-108.50-108.00 and 107.50-106.90.

 
Intraday Support Levels
S1     109.50-109.00
S2     108.50
S3     107.50-107.00

INTRADAY RESISTANCE LEVELS
R1     110.20-110.90
R2     111.70
R3     112.50-113.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.407 Buy
20-DMA   108.83 Sell
50-DMA   109.07 Sell
100-DMA   106.99 Sell
200-DMA   106.00 Sell
STOCH(9,6)   51.253 Sell
MACD(12,26,9)   0.103 Sell

AAFX TRADING
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