AAFX TRADING

Daily Market Lookup

  • The dollar traded marginally higher Tuesday, stabilizing below recent highs ahead of the start of the latest U.S. Federal Reserve meeting which could provide clues of future policy action. Trading ranges are likely to be small Tuesday at the start of the two-day meeting of the Federal Reserve, concluding on Wednesday. There isn’t expected to be a change in policy at this meeting, but traders will be looking for any discussions about the timing of the removal of the central bank’s bond purchases as well as the members’ thinking over the current elevated inflation levels. The pair has risen around 0.4% over the last month with the yuan weighed by a Chinese regulatory crackdown as well as China reporting the most Covid cases on Monday since the end of January. EUR/HUF rose 0.1% to 361.53 and USD/HUF rose 0.2% to 306.58 ahead of the latest meeting of Hungary’s central bank, which is expected to result in a second interest-rate increase in as many months to combat sharply rising prices. Most analysts surveyed by Bloomberg predict the base rate will be lifted by 15 basis points from the current 0.90%, but some are looking for a larger increase. The U.S. dollar hovered below recent peaks on Tuesday, as investors turned to this week's Federal Reserve meeting for clues on the policy outlook, while cryptocurrencies pulled back sharply from an attempt to break out of a monthslong range. The greenback has been rising broadly for more than a month as markets have become wary of the Fed starting to taper its monetary support. Investors turned long dollars for the first time since March 2020 last week, positioning data shows. The Fed meeting is on Wednesday and the focus is on discussions around bond purchases and insight into the bank's comfort with surging inflation, with the upshot for currency markets not clear cut. Steve Englander, head of G10 FX research at Standard Chartered (OTC:SCBFF), however, said that a steer on the Fed's thinking about a sharp but likely transitory jump in inflation will be just as important. A tick higher in inflation expectations on Monday pushed U.S. 10-year real yields to a record low of -1.123%, which also contributed to overnight softness in the dollar. Elsewhere, concern at the spread of the Delta coronavirus variant and jitters in China's stock market kept trade cautious during Asia hours. The risk-sensitive Australian dollar was steady at $0.7382 and the kiwi held around $0.7000. Sterling was above its 20-day moving average and near a one-week high at $1.3827 as early data seemed to show an ebb in surging COVID-19 cases in Britain in spite of the removal of many social curbs last week. The Chinese yuan has held up despite turmoil in equities and was steady at 6.4760. The dollar index slipped slightly to 92.833 due to pressure from the euro and yen, but was still close to last week's 3-1/2-month high of 93.194 It has gained nearly 4% from a recent low on May 25 as an improving U.S. economy bolstered the outlook for the Fed to start paring asset purchases as early as this year. They added that there were risks for a slightly later announcement of a taper decision from the Fed - for example, out to the fourth quarter - given the added uncertainty associated with the Delta variant of the coronavirus The Fed at its last meeting on June 16 dropped a reference to the coronavirus as a drag on the economy. The risks from the Delta variant continue to rise globally, with U.S. top infectious disease official Anthony Fauci saying some Americans may need booster shots amid new mask mandates and a surge in new cases. China reported its highest number of cases since the end of January, while new infections have also spiked in Japan, where Tokyo is currently hosting the Olympics.
  • Gold was down on Tuesday morning in Asia. Investors were cautious ahead of a U.S. Federal Reserve policy decision later in the week for clues over when the central bank will adopt a more hawkish tone. The dollar, which normally moves inversely to gold, inched down on Tuesday. However, the greenback remained just below recent peaks and has been rising broadly for more than a month. Fed officials will begin a two-day meeting later in the day, with the policy decision to be handed down on Wednesday. The central bank is likely to affirm that a strong U.S. recovery and plans for an eventual policy shift are both ongoing. In Asia, Bank of Japan governor Haruhiko Kuroda will speak later in the day. Despite strong economic growth prospects for 2021 into 2022, the surging number of global COVID-19 cases involving the Delta variant continues to pose the biggest threat to that outlook. Net gold imports of gold into China, the biggest bullion consumer globally, via Hong Kong jumped nearly 42% in June after a slump in May, according to data released on Monday. SPDR Gold Trust (P:GLD) holdings fell 0.2% to 1,025.64 tons on Monday, its biggest loss since May 13. It has seen outflows of about 20 tons for the month of July to date.
  • Oil was up Tuesday morning in Asia, with prices steadying from Monday’s fall. Investors are hoping that tight supply and rising vaccination rates will offset the impact of rising global COVID-19 cases on fuel demand. The surging number of COVID-10 cases prompted the U.S. to issue travel warnings to Spain and Portugal and a White House official to tell Reuters on Wednesday that wider travel curbs will not be immediately lifted. But in the U.K., the lowest daily total of new Covid-19 cases since Jul. 4 was recorded on Monday, with hopes rising that the country’s latest surge in cases has passed its peak. Some investors were optimistic about the fuel demand outlook as they looked to COVID-19 vaccines to prevent new restrictive measures from being implemented. Despite Shum’s optimism, global oil markets are expected to remain in deficit even as the Organization of the Petroleum Exporting Countries and its allies, or OPEC+, resolved a supply dispute and will raise production through the rest of 2021. However, other investors also remained optimistic. Investors now await U.S. crude oil supply data from the American Petroleum Institute, due later in the day.

 

 
Intraday RESISTANCE LEVELS
27th July 2021 R1 R2 R3
GOLD-XAU 1,800-1,812 1,820 1,833-1,840
Silver-XAG 25.50-26.00 26.50 26.90-27.55
Crude Oil 71.65-71.90 72.50 73.40-74.00
EURO/USD 1.1840-1.1910 1.1990 1.2040-1.2080
GBP/USD 1.3810 1.3890 1.3950-1.4010
USD/JPY 110.50-111.70 112.50 113.00-113.90

Intraday SUPPORTS LEVELS
27th July 2021 S1 S2 S3
GOLD-XAU 1,786¬-1,780 1,774 1,769-1,760
Silver-XAG 25.05-24.80 24.50 24.00-23.50
Crude Oil 71.00-70.10 69.40 69.00-68.60
EURO/USD 1.1770-1.1690 1.1610 1.1550-1.1500
GBP/USD 1.3750-1.3720 1.3685 1.3600-1.3520
USD/JPY 109.60-109.10 108.50 107.50-106.80

Intra-Day Strategy (27th 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 Monday made its intraday high of US$1811.43/oz and low of US$1796.32 /oz. Gold down 0.277% at US$1797.43/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 1790-1769 with risk below 1760, targeting 1800-1812-1820 and 1833-1840-1854. Sell in between 1812-1860 keeping stop loss closing above 1860, targeting 1800-1790 and 1771-1767-1755.

 
Intraday Support Levels
S1     1,786¬-1,780
S2     1,774
S3     1,769-1,760
Intraday Resistance Levels
R1     1,800-1,812
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 Monday made its intraday high of US$25.42/oz and low of US$25.10/oz settled down by 0.0436% at US$25.17/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 25.05-23.50, targeting 25.50-26.00-26.65 and 26.90-27.55-27.90 with stop loss should be place on the breakage below 23.50. Sell in between 25.50-28.50 with stop loss above 28.50; targeting 26.00-25.70 and 25.05-24.80-24.00.

 
Intraday  Support Levels
S1     25.05-24.80
S2     24.50
S3     24.00-23.50

Intraday  Resistance Levels
R1     25.50-26.00
R2     26.50
R3     26.90-27.55

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.742 Buy
20-DMA   25.69 Sell
50-DMA   26.17 Sell
100-DMA   26.22 Sell
200-DMA   25.45 Buy
STOCH(5,3)   53.413 Buy
MACD(12,26,9)   -0.3810 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$72.18/bbl, intraday low of US$70.34/bbl and settled up by 0.146% to close at US$71.96/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 neutral 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 70.10-66.90 with risk daily closing below 66.90 and targeting 70.90-71.65 and 71.90-72.50. Sell in between 71.65-74.05 with stop loss at 74.05; targeting 71.00-70.10-69.40 and 68.50-67.90-66.90.

 
Intraday Support Levels
S1     71.00-70.10
S2     69.40
S3     69.00-68.60

Intraday Resistance Levels
R1     71.65-71.90
R2     72.50
R3     73.40-74.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.266 Sell
20-DMA   74.51 Buy
50-DMA   72.21 Buy
100-DMA   70.01 Buy
200-DMA   59.74 Buy
STOCH(5,3)   49.130 Buy
MACD(12,26,9)   1.767 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.1762/EUR, high of US$1.1785/EUR and settled the day up by 0.0076% to close at US$1.1802/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 1.1770-1.1600 with risk below 1.1600, targeting 1.1840-1.1910-1.1990 and 1.2040-1.2100.

 
Intraday Support Levels
S1     1.1770-1.1690
S2     1.1610
S3     1.1550-1.1500

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.525 Buy
20-DMA   1.1820 Sell
50-DMA   1.1830 Sell
100-DMA   1.1961 Sell
200-DMA   1.1915 Sell
STOCH(5,3)   0.758 Sell
MACD(12,26,9)   0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3736/GBP, high of US$1.3832/GBP and settled the day up by 0.461% to close at US$1.3817/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 1.3810-1.4010 with targets at 1.3750-1.3685-1.3600 and 1.3520-1.3450 stop-loss should be 1.4000. Buy above 1.3750-1.3450 with targets 1.3685-1.3750-1.3800 and 1.3905-1.3965-1.4025 with stop loss closing below 1.3320.

 
Intraday Support Levels
S1     1.3750-1.3720
S2     1.3685
S3     1.3600-1.3520

Intraday Resistance Levels
R1     1.3810
R2     1.3890
R3     1.3950-1.4010

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

42.207

Buy
20-DMA   1.3807 Sell
50-DMA   1.3889 Sell
100-DMA   1.3867 Sell
200-DMA   1.3685 Buy
STOCH(5,3)   37.940 Buy
MACD(12,26,9)   0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.11/USD and made an intraday high of JPY110.57/USD and settled the day down 0.0905% at JPY110.35/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 109.60-106.50 with targets of 110.90-111.70-112.20 with stop below 106.00. Sell below 110.50-114.50 with risk above 114.50 targeting 109.70-109.00-108.50-108.00.

 
Intraday Support Levels
S1     109.60-109.10
S2     108.50
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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