AAFX TRADING

Daily Market Lookup

  • The dollar was up on Monday morning in Asia. Risk currencies remained above their recent lows against both the U.S. currency and the yen as investor fears of a slowdown in the global economic recovery from COVID-19 calmed down for now. The USD/JPY pair inched up 0.01% to 110.16. Data released earlier in the day said Japan’s core machinery orders grew a better-than-expected 7.8% month-on-month and 12.2% year-on-year in May. The data also said the country’s producer price index (PPI) grew 5% year-on-year and 0.6% month-on-month in June. The USD/CNY pair inched down 0.07% to 6.4741, with Chinese trade data, including exports, imports and the trade balance, due to be released later in the week. Investors’ focus turned to U.S. inflation and when the country’s Federal Reserve will start tightening its monetary policy ahead of the release of the U.S. core consumer price index (CPI) for June on Tuesday. Fed Chairman Jerome Powell will also testify before the Senate Banking Committee later in the week. A recovery in risk sentiment hampered the safe-haven yen ahead of the release of the U.S. CPI as well as the PPI. Should the data indicate inflation is more persistent than previously thought, the Fed could begin asset tapering sooner than expected and boost the greenback. However, more benign data would benefit riskier currencies as asset tapering would begin later than expected in this scenario. Risk currencies slipped earlier in the previous week as disappointing economic data from several countries led to decreased investor bets. The latest outbreaks of COVID-19, including the Delta variant of the virus, led to renewed restrictive measures in countries including Australia and South Korea and added to an already cautious mood However, the selloff had subsided by Friday, and investor sentiment further improved after the People’s Bank of China cut banks' reserve requirement ratio across the board in a surprise move to bolster China’s economic recovery from COVID-19.
  • The dollar posted strong gains throughout most of last week, helped by its safe haven status amid worries that the fast-spreading delta variant of the Covid-19 virus could hamper the global economic revival However, this demand largely subsided on Friday, helped by China’s decision to cut banks' reserve requirement ratio to underpin a recovery that looked like it was losing momentum. Attention this week is set to turn back to the outlook for U.S. inflation and the speed of the Federal Reserve's future policy tightening, with Tuesday seeing the release of consumer price data and Wednesday the release of factory gate price data. Additionally, Fed Chair Jerome Powell is set to testify in front of Congress on both Wednesday and Thursday. Any signs that inflation could be more persistent than previously thought could lift expectations the Fed may quickly rein in its very easy monetary policy, supporting the dollar. Elsewhere, USD/CNY fell 0.1% to 6.4746, with China set to release a deluge of economic data this week, including figures on trade, retail sales and industrial output. Last week’s sudden easing in policy last week has raised concerns that this figures will show a slowing in the country’s recovery from the pandemic.
  • Crude futures slipped on Monday as concerns over slowing global growth outweighed the prospect of tightening supply after talks among key producers to raise output in coming months stalled. The spread of coronavirus variants and unequal access to vaccines threaten the global economic recovery, finance chiefs of the G20 large economies warned on Saturday. A Reuters tally of new COVID-19 infections shows them rising in 69 countries, with the daily rate pointing upwards since late-June and now hitting 478,000. Oil prices slumped last Tuesday after the Organization of the Petroleum Exporting Countries and their allies, a group known as OPEC+, did not reach an agreement to increase output from August. This was because the United Arab Emirates rejected a proposed eight-month extension to OPEC+ output curbs. The world's top oil exporter Saudi Arabia met full contractual demand for crude oil from five buyers in August, but turned down at least two requests for additional volumes. Front-month WTI crude futures posted their sixth weekly gain last week after a bullish report from the U.S. Energy Information Administration showed U.S. crude and gasoline stocks fell while gasoline demand reached its highest since 2019. In response to higher oil prices, U.S. energy firms added oil and natural gas rigs for a second week in a row, data from Baker Hughes showed.

 

 
Intraday RESISTANCE LEVELS
12th July 2021 R1 R2 R3
GOLD-XAU 1,805-1,812 1,820 1,833-1,840
Silver-XAG 26.00-26.50 26.90 27.55-27.90
Crude Oil 71.00-71.40 72.00 72.60-73.20
EURO/USD 1.1840-1.1910 1.1990 1.2040-1.2080
GBP/USD 1.3800-1.3905 1.3965 1.4025-1.4100
USD/JPY 110.50-111.70 112.50 113.00-113.90

Intraday SUPPORTS LEVELS
12th July 2021 S1 S2 S3
GOLD-XAU 1,790 1,780 1,767 -1,760
Silver-XAG 25.70-25.05 24.80 24.50-24.05
Crude Oil 70.10-69.50 68.70 67.80-67.00
EURO/USD 1.1800 1.1750 1.1690-1.1600
GBP/USD 1.3770 1.3720 1.3650-1.3600
USD/JPY 109.70-109.10 107.50-106.80 107.50-106.80

Intra-Day Strategy (12th July 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$1818.34/oz and low of US$1794.20/oz. Gold down 0.0454% at US$1802.54/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

Buy in Between 1790-1771 with risk below 1771, targeting 1805-1812-1820 and 1833-1840-1852. Sell in between 1805-1840 keeping stop loss closing above 1840, targeting 1805-1790-1771 and 1767-1755.

 
Intraday Support Levels
S1     1,790
S2     1,780
S3     1,767 -1,760
Intraday Resistance Levels
R1     1,805-1,812
R2     1,820
R3     1,833-1,840

Technical Indicators

Name   Value Action
14DRSI  

37.215

Buy
20-DMA   1820.03 Sell
50-DMA  

1832.84

Sell
100-DMA   1790.71 Sell
200-DMA   1830.21 Sell
STOCH(5,3)   44.503 Sell
MACD(12,26,9)   -23.653 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$26.20/oz and low of US$25.79/oz settled down by 0.970% at US$25.90/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (26.62), breakage above will lead to 27.60. 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 oversold region and giving positive crossover to show upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 25.70-24.80, targeting 26.65-27.00-27.55 and 27.90-28.35-28.90 with stop loss should be place on the breakage below 24.00. Sell in between 26.50-28.50 with stop loss above 28.50; targeting 26.00-25.70 and 25.05-24.80-24.00.

 
Intraday  Support Levels
S1     25.70-25.05
S2     24.80
S3     24.50-24.05

Intraday  Resistance Levels
R1     26.00-26.50
R2     26.90
R3     27.55-27.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.739 Buy
20-DMA   26.73 Sell
50-DMA   27.04 Sell
100-DMA   26.51 Sell
200-DMA   25.68 Buy
STOCH(5,3)   64.413 Buy
MACD(12,26,9)   -0.3810 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$72.67/bbl, intraday low of US$70.25/bbl and settled up by 1.256% to close at US$72.63/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 20DMA i.e. 68.50 which is a support level and breakage below will call for 65.40. 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

Buy above 70.1069.30 with risk daily closing below 69.30 and targeting 74.00-74.60-75.00 and 75.80-76.50-77.05. Sell in between 74.00-76.50 with stop loss at 76.50; targeting 73.10-72.60-72.00 and 71.40-70.90.

 
Intraday Support Levels
S1     70.10-69.50
S2     68.70
S3     67.80-67.00

Intraday Resistance Levels
R1     71.00-71.40
R2     72.00
R3     72.60-73.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.920 Sell
20-DMA   72.62 Buy
50-DMA   68.64 Buy
100-DMA   65.19 Buy
200-DMA   55.73 Buy
STOCH(5,3)   50.130 Sell
MACD(12,26,9)   1.767 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday an intraday low of US$1.1782/EUR, high of US$1.1867/EUR and settled the day up by 0.452% to close at US$1.1824/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 1.1840-1.2140 targeting 1.1850-1.1800-1.1750 with stop-loss at daily closing above 1.2140. Buy above 1.1800-1.1600 with risk below 1.1600, targeting 1.1910-1.1990-1.2040 and 1.2100-1.2140.

 
Intraday Support Levels
S1     1.1800
S2     1.1750
S3     1.1690-1.1600

Intraday  Resistance Levels
R1     1.1840-1.1910
R2     1.1990
R3     1.2040-1.2080

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 Thursday made an intra‐day low of US$1.3741/GBP, high of US$1.3804/GBP and settled the day down by 0.0130% to close at US$1.3780/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 1.3800-1.4220 with targets at 1.3770-1.3720 and 1.3660-1.3600-1.3560 stop-loss should be 1.4220. Buy above 1.3770-1.3560 with targets 1.3800-1.3905-1.3965 and 1.4025-1.4065-1.4090 with stop loss closing below 1.3660.

 
Intraday Support Levels
S1     1.3770
S2     1.3720
S3     1.3650-1.3600

Intraday Resistance Levels
R1     1.3800-1.3905
R2     1.3965
R3     1.4025-1.4100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

32.738

Buy
20-DMA   1.3987 Sell
50-DMA   1.4026 Sell
100-DMA   1.3942 Buy
200-DMA   1.3633 Buy
STOCH(5,3)   8.940 Sell
MACD(12,26,9)   0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY109.52/USD and made an intraday high of JPY110.67/USD and settled the day down 0.274% at JPY109.63/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 110.50-106.50 with targets of 110.90-111.70-112.20 with stop below 106.00. Sell below 111.70-114.50 with risk above 114.50 targeting 110.90-110.20-109.50 and 109.00-108.50-108.00.

 
Intraday Support Levels
S1     109.70-109.10
S2     107.50-106.80
S3     107.50-106.80

INTRADAY RESISTANCE LEVELS
R1     110.50-111.70
R2     112.50
R3     113.00-113.90

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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