AAFX TRADING

Daily Market Lookup

  • The dollar was down on Monday morning in Asia. The greenback opened a busy week ahead, including the latest U.S. jobs report and a Reserve Bank of Australia (RBA) policy decision, just above a one-month low. The AUD/USD pair inched down 0.01% to 0.7344. The RBA will hand down its policy decision on Tuesday when it is widely expected to reverse its previous decision to begin asset tapering. A likely contributor to RBA's change of tactic would be extended lockdowns in parts of the country, with Brisbane the latest city to extend its lockdown, originally slated to end on Tuesday, to at least Sunday. Sydney is also currently under a lockdown that will be implemented for at least nine weeks until Aug. 28. China’s Caixin manufacturing purchasing managers’ index (PMI), released earlier in the day, was a lower-than-expected 50.3 in July. The manufacturing and non-manufacturing PMIs for the same month, released on Saturday, were 50.4 and 53.3 respectively. U.S. Federal Chairman Jerome Powell reiterated that interest rate hikes were "a ways away" and the job market still had "some ground to cover” before the central bank could begin asset tapering as he handed down the Fed policy decision during the previous week. Powell’s sentiments were echoed by Fed Governor Lael Brainard, who on Friday said, "employment has some distance to go." The Fed policy decision handed down the month before, in June, boosted the dollar to its highest level since April 2021 as investors bet on asset tapering to begin as early as 2021. The latest data from the Commodity Futures Trading Commission and calculations prepared by Reuters pointed to dollar net long positions rising to their highest level since early March 2020 in the week to Jul. 27. Investors are now turning their attention to the latest U.S. job report, including non-farm payrolls and the unemployment rate, due to be released on Friday.
  • The dollar held just above a one-month low on Monday as traders held tight positions heading into a busy week that includes monthly U.S. jobs data and a key Australian central bank decision. Fed Governor Lael Brainard echoed those comments on Friday, saying "employment has some distance to go." The dollar index last month hit its highest since the start of April at 93.194 as traders positioned for a start to tapering as soon as this year. Dollar net long positions rose to their highest level since early March of last year in the week to July 27, according to Reuters calculations and the latest data from the Commodity Futures Trading Commission. Economists in a Reuters poll forecast a 926,000 job increase in July's non-farm payrolls number, due Friday, which would be the biggest increase for 11 months. The U.S. unemployment rate is forecast to fall to 5.7%, from 5.9% in June. The Aussie dollar was largely steady at $0.73475, before the Reserve Bank of Australia meets on Tuesday, when it is widely expected to backtrack on a previous decision to taper stimulus, with protracted COVID-19 lockdowns dragging on growth. The dollar rose on Friday along with other safe haven currencies as stocks fell and as upbeat U.S. economic data helped reverse some of the losses from earlier this week when dovish remarks by the Federal Reserve tanked a month-long rally in the greenback. The dollar also got a lift after St. Louis Federal Reserve President James Bullard said the Fed should start reducing its $120 billion in monthly bond purchases this fall and cut them "fairly rapidly" so the program ends in the first months of 2022 to pave the way for a rate increase that year if needed. Economic data on Friday was dollar-positive, showing a higher-than-expected rise in U.S. consumer spending in June as COVID-19 vaccinations boosted demand for travel-related services and recreation, even though part of the increase reflected higher prices, with annual inflation accelerating further above the Fed's 2% target. The euro eased 0.26% against the greenback but near a 1-month high after data showed the euro zone economy grew more quickly than expected in the second quarter, pulling out of a pandemic-related recession, while inflation shot past the European Central Bank's 2% target in July.
  • Oil was down Monday morning in Asia, as concerns over a slowing economic recovery in China, the second-largest oil consumer globally, clouded the fuel demand outlook. Investors were also looking ahead to the Organization of the Petroleum Exporting Countries and allies (OPEC+) increasing its oil output. China’s Caixin manufacturing purchasing managers’ index (PMI) released earlier in the day, was a lower-than-expected 50.3 in July. The manufacturing and non-manufacturing PMIs, released on Saturday, were 50.4 and 53.3. Higher raw material costs, equipment maintenance, recent floods, and the latest outbreak of COVID-19 weighed on business activity in the country, with the pace of growth the slowest in nearly a year and a half. OPEC+’s July oil output reportedly rose to its highest level since April 2020. The cartel will further ease existing production curbs from Aug 1. onwards, while Saudi Arabia, the biggest oil exporter globally, phased out its voluntary supply cut. On the COVID-19 front, the number of global daily cases continues to increase. However, it is hoped that higher vaccination rates could avert the need for the harsh restrictive measures that led to sharp drops in fuel demand in 2020. The U.S. will not order a lockdown, but "things are going to get worse" as the Delta variant of the virus fuels a surge in daily cases in mostly unvaccinated populations, U.S. National Institute of Allergy and Infectious Diseases director Anthony Fauci said on Sunday. In India, the third-largest oil importer globally, July’s daily gasoline consumption exceeded pre-COVID-19 levels. States across the country relaxed COVID-19 lockdowns while gasoil sales were low, an indication of subdued industrial activity Meanwhile, Iran is likely to be behind Thursday’s attack on an Israeli-managed petroleum product tanker off the coast of Oman, the U.S. and the U.K. said on Sunday. The attack killed a Briton and a Romanian, with the U.S. and U.K. vowing to work with partners for a response.

 

 
Intraday RESISTANCE LEVELS
2nd August 2021 R1 R2 R3
GOLD-XAU 1,820-1,833 1,840 1,845-1,852
Silver-XAG 26.00-26.50 26.90 27.50-28.20
Crude Oil 73.40¬-74.00 74.50 75.20-76.00
EURO/USD 1.1910 1.1990 1.2040-1.2080
GBP/USD 1.3955-1.4020 1.4050 1.4120-1.4150
USD/JPY 110.50-111.70 112.50 113.00-113.90

Intraday SUPPORTS LEVELS
2nd August 2021 S1 S2 S3
GOLD-XAU 1,812-1,800 1,786 1,780-1,767
Silver-XAG 25.40-25.05 24.75 24.50-24.00
Crude Oil 73.00-72.60 71.90 71.65-71.00
EURO/USD 1.1840-1.1770 1.1690 1.1610-1.1550
GBP/USD 1.3890-1.3810 1.3750 1.3696-1.3615
USD/JPY 109.60-109.10 108.50 107.50-106.80

Intra-Day Strategy (2nd August 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$1831.26/oz and low of US$1810.16/oz. Gold down 0.775% at US$1813.93/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 1805-1767 with risk below 1767, targeting 1820-1833 and 1840-1854. Sell in between 1820-1860 keeping stop loss closing above 1860, targeting 1812-1800-1790 and 1780-1767.

 
Intraday Support Levels
S1     1,812-1,800
S2     1,786
S3     1,780-1,767
Intraday Resistance Levels
R1     1,820-1,833
R2     1,840
R3     1,845-1,852

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 Friday made its intraday high of US$25.62/oz and low of US$25.33/oz settled down by 0.105% at US$25.47/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     25.40-25.05
S2     24.75
S3     24.50-24.00

Intraday  Resistance Levels
R1     26.00-26.50
R2     26.90
R3     27.50-28.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.411 Buy
20-DMA   24.48 Sell
50-DMA   26.08 Sell
100-DMA   26.17 Sell
200-DMA   25.44 Buy
STOCH(5,3)   51.413 Buy
MACD(12,26,9)   -0.380 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$73.86/bbl, intraday low of US$72.60/bbl and settled up by 0.383% to close at US$73.34/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

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.

 
Intraday Support Levels
S1     73.00-72.60
S2     71.90
S3     71.65-71.00

Intraday Resistance Levels
R1     73.40¬-74.00
R2     74.50
R3     75.20-76.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.754 Sell
20-DMA   71.77 Buy
50-DMA   70.36 Buy
100-DMA   66.82 Buy
200-DMA   60.71 Buy
STOCH(5,3)   88.130 Buy
MACD(12,26,9)   0.2788 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday an intraday low of US$1.1850/EUR, high of US$1.1908/EUR and settled the day up by 0.127% to close at US$1.1871/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 1.1910-1.2140 targeting 1.1850-1.1800-1.1750 with stop-loss at daily closing above 1.2140. Buy above 1.1840-1.1600 with risk below 1.1600, targeting 1.1840-1.1910-1.1990 and 1.2040-1.2100.

 
Intraday Support Levels
S1     1.1840-1.1770
S2     1.1690
S3     1.1610-1.1550

Intraday  Resistance Levels
R1     1.1910
R2     1.1990
R3     1.2040-1.2080

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.548 Buy
20-DMA   1.1842 Sell
50-DMA   1.1913 Sell
100-DMA   1.1956 Sell
200-DMA   1.1914 Sell
STOCH(5,3)   87.758 Sell
MACD(12,26,9)   -0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.3887/GBP, high of US$1.3982/GBP and settled the day down by 0.359% to close at US$1.3902/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.3867) 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 overbought 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 1.3955-1.4120 with targets at 1.3890-1.3810-1.3750 and 1.3685-1.3600-1.3520 stop-loss should be 1.4120. Buy above 1.3890-1.3600 with targets 1.3955-1.4020 and 1.4050-1.4120 with stop loss closing below 1.3600.

 
Intraday Support Levels
S1     1.3890-1.3810
S2     1.3750
S3     1.3696-1.3615

Intraday Resistance Levels
R1     1.3955-1.4020
R2     1.4050
R3     1.4120-1.4150

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

53.930

Buy
20-DMA   1.3839 Buy
50-DMA   1.3886 Buy
100-DMA   1.3867 Buy
200-DMA   1.3696 Buy
STOCH(5,3)   83.940 Sell
MACD(12,26,9)   -0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY109.35/USD and made an intraday high of JPY109.82/USD and settled the day down 0.181% at JPY109.65/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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