AAFX TRADING

Daily Market Lookup

  • The dollar hovered near a five-month low versus major peers on Thursday as investors looked to U.S. inflation data and a European Central Bank meeting later in the day to provide a spur for lacklustre currency markets. Investors have adopted a wait-and-see attitude all week, sucking volatility from the market and leaving major currencies mostly range-bound. The dollar index has fluctuated narrowly around the psychologically important 90 level, and was last at 90.206 - not too far from last month's low of 89.533, a level not seen since early January. The U.S. Labor Department's consumer prices data has been much anticipated after last month's report showed consumer prices increased by the most in nearly 12 years in April. That has stoked bets that higher prices could last longer than some anticipate, potentially calling into question the Federal Reserve's insistence that current inflation pressures are transitory and monetary stimulus should stay in place for some time yet. Economists polled by Reuters estimated the CPI advanced 0.4% in May. Westpac analysts side with Federal Open Market Committee (FOMC) officials in the inflation debate, and don't expect a taper of the central bank's asset-purchase programme until the second half of next year. They forecast the dollar index will drop to 87.30 at that time, before then grinding higher again "as U.S. monetary tightening takes effect," according to a research note. While the greenback has kept to tight ranges in the run-up to the CPI report, benchmark 10-year Treasury yields - which helped drive the dollar index to a multi-year high earlier this year - have taken a sizeable step lower in the past week and were at 1.4806% in Asia from as high as 1.6350% on Friday. With the ECB, investors will be watching for any clues of an imminent slowdown to its bond-buying program. While the ECB is widely expected to keep policy settings steady, the euro could be sensitive to changes in the bank's economic forecasts or any signal that the pace of bond buying could be reduced in months ahead. In crypto markets, bitcoin held gains from its biggest rally in four months on Wednesday, when it jumped nearly 12%. It last traded largely unchanged at $36,709.67, after rebounding from a three-week low of $31,025 hit on Tuesday when signs of institutional investor caution and regulatory attention drove selling.
  • The dollar edged higher in early European trade Thursday, amid cautious trading with traders looking towards key U.S. inflation data and an ECB meeting for clues of future direction. Activity within the foreign exchange market has been limited all week, leaving major currencies mostly range-bound, with traders cautiously awaiting the release of the U.S. Labor Department's consumer prices data for May. Last month's report showed consumer prices increased by the most in nearly 12 years in April, and that called into question the Federal Reserve's guidance that current inflation pressures would be transitory and thus monetary stimulus should stay in place for some time yet. Another strong report would increase the pressure on the central bank to act even further, potentially driving up U.S. Treasury yields to the benefit of the dollar. Economists are looking for CPI to have advanced 0.4% on the month in May, an annual climb of 4.7% for the headline figure. The core figure, which excludes price rises from the volatile food and energy sectors, is seen up 0.4% on the month, 3.4% on the year. The other major event Thursday is the latest policy decision by the European Central Bank, with investors carefully watching for any clues of an imminent slowdown to its bond-buying program. This move throws the focus forward to next month’s meeting, amid growing expectations for another reduction in emergency stimulus. The central bank was among the first from advanced economies to shift to a less expansionary policy in April, when it accelerated the timetable for a possible interest-rate increase and pared back its bond purchases.
  • Oil prices fell on Thursday as inventory data in the United States, the world's top oil consumer, showed a surge in gasoline stocks that indicated weaker-than-expected fuel demand at the start of summer, the country's peak season for motoring. U.S. crude oil stockpiles that include the Strategic Petroleum Reserve (SPR) fell for the 11th straight week as refiners ramped up output, but fuel inventories grew sharply due to weak consumer demand, the Energy Information Administration (EIA) said on Wednesday. Crude inventories that exclude the SPR fell by 5.2 million barrels in the week to June 4 to 474 million barrels, the third consecutive weekly drop. But fuel stocks were up sharply, with product supplied falling to 17.7 million barrels per day (bpd) versus 19.1 million the week before. Implied gasoline demand fell to 8.48 million bpd in the week to June 4, down from 9.15 million bpd from the week before, but up from 7.9 million bpd a year ago, EIA data showed. In another development weighing on prices, Libya's Waha Oil Co aims to return to normal output operations on Thursday after fixing a leak on a pipeline that more than halved the company's oil production, an oil source at the Es Sider crude export terminal said. In India, the world's third-largest oil consumer, fuel demand slumped in May to its lowest since August last year, with a second COVID-19 wave stalling mobility and muting economic activity in the world's third largest oil consumer.

 

 
Intraday RESISTANCE LEVELS
10th June 2021 R1 R2 R3
GOLD-XAU 1,884-1,900 1,920-1,929 1,920-1,929
Silver-XAG 27.90-28.50 28.90 29.50-30.10
Crude Oil 70.50-71.00 71.60 72.00-72.50
EURO/USD 1.2190-1.2240 1.2300 1.2350-1.2400
GBP/USD 1.4090-1.4140 1.4200 1.4240-1.4300
USD/JPY 110.20-110.90 111.70 112.50-113.00

Intraday SUPPORTS LEVELS
10th June 2021 S1 S2 S3
GOLD-XAU 1,876 1,865 1,856-1,845
Silver-XAG 27.55-27.25 26.55 26.00-25.60
Crude Oil 69.30 68.50 67.90-67.00
EURO/USD 1.2140-1.2100 1.2070 1.2010-1.1950
GBP/USD 1.4065-1.4010 1.3920 1.3850-1.3800
USD/JPY 109.50-109.00 108.50 107.50-107.00

Intra-Day Strategy (10th 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 Thursday made its intraday high of US$1898.91/oz and low of US$1883.70/oz. Gold up 0.220% at US$1888.34/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     1,876
S2     1,865
S3     1,856-1,845
Intraday Resistance Levels
R1     1,884-1,900
R2     1,920-1,929
R3     1,920-1,929

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 Wednesday made its intraday high of US$27.99/oz and low of US$27.50/oz settled down by 1.025% at US$27.74/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 Wednesday made an intra‐day high of US$70.46/bbl, intraday low of US$69.31/bbl and settled down by 0.346% to close at US$69.57/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 70.50-72.70 with stop loss at 72.70; targeting 69.70-69.30-68.50 and 67.90-67.00-66.10. 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     69.30
S2     68.50
S3     67.90-67.00

Intraday Resistance Levels
R1     70.50-71.00
R2     71.60
R3     72.00-72.50

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 Wednesday an intraday low of US$1.2170/EUR, high of US$1.2217/EUR and settled the day up by 0.133% to close at US$1.2179/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 Wednesday made an intra‐day low of US$1.4109/GBP, high of US$1.4188/GBP and settled the day down by 0.240% to close at US$1.4116/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 1.4090-1.4490 with targets at 1.4065-1.4010 and 1.3920-1.3800 stop-loss should be 1.4500. Buy above 1.4065-1.3800 with targets 1.4090-1.4140-1.4200 and 1.4240-1.4300-1.4360 with stop loss closing below 1.3700.

 
Intraday Support Levels
S1     1.4065-1.4010
S2     1.3920
S3     1.3850-1.3800

Intraday Resistance Levels
R1     1.4090-1.4140
R2     1.4200
R3     1.4240-1.4300

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 Wednesday made intra‐day low of JPY109.21/USD and made an intraday high of JPY109.65/USD and settled the day up 0.0904% at JPY109.59/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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