AAFX TRADING

Daily Market Lookup

  • The dollar edged lower Tuesday in tight trading ranges, with traders reluctant to take strong positions ahead of the release of key U.S. employment data at the end of the week. The dollar has trended lower since Federal Reserve Chairman Jerome Powell indicated last week that interest rate increases were still a long way away, falling to a low of 91.775 on Friday, the weakest since June 28. An Institute for Supply Management report on Monday showed July U.S. manufacturing growth slowed for the second straight month, a release that played into Powell’s belief that more economic progress was needed before the central bank started tapering its huge bond-buying program. Economic data later Tuesday centers around June factory orders, which are forecast to grow 1.0% on the month, slowing from 1.7% growth the previous month. But all eyes will be on Friday’s official jobs report which will provide some indications of how sustained the U.S. recovery has been in July. Economists are looking for an increase of 900,000 jobs, which would be the biggest increase for 11 months. Elsewhere, AUD/USD rose 0.5% to 0.7399 after the Reserve Bank of Australia surprised the market by keeping to its plan to taper its bond purchases even with Covid-related lockdowns in a number of cities likely to derail the country’s economic recovery. Many traders had expected the central bank to reverse its tapering plan given the new wave of Covid-19 cases, but this move shows an underlying confidence that the economy will bounce back quickly once restrictions are removed. Inflation is likely to climb to an annual 18.6% in July, up from 17.5% in June, according to a survey of analysts by Bloomberg, which would likely reduce the chances of an interest-rate cut in the near future.
  • The dollar was down on Tuesday morning in Asia, recording losses against the safe-haven Japanese yen. Concerns over the most recent COVID-19 outbreaks globally, as well as U.S. manufacturing data released on Monday, led investors to wind back bets on a strong economic recovery from the virus. The world’s second-largest economy is scrambling to curb its latest COVID-19 outbreak, which is spreading from the coast to inland cities. Other countries in the region, some of which had initial success at curbing the virus, have been struggling to contain their own outbreaks. Japan extended a state of emergency, currently covering Tokyo and Okinawa, to Osaka, Chiba, Kanagawa and Saitama prefectures on Monday. The state of emergency, effective through Aug. 31, comes as the number of daily cases in Tokyo hit a record The Delta variant, described as contagious as chickenpox and far more contagious than the common cold or flu by the U.S. Centers for Disease Control and Prevention (CDC) earlier in the week, also contributed to rising numbers of cases in the U.S. COVID-19 concerns overrode the progress on the U.S.’ $1 trillion infrastructure investment bill that could be ready for a final vote within the week. Meanwhile, data released on Monday said the U.S. manufacturing purchasing managers index (PMI) was a better-than-expected 63.4 in July, while the Institute of Supply Management (ISM) manufacturing PMI was a lower-than-expected 59.5. The ISM manufacturing employment index was a better-than-expected 52.9 in July.
  • Gold was down on Tuesday morning in Asia, with investors awaiting the latest U.S. jobs report to predict the U.S. Federal Reserve’s next policy move. Investors had been somewhat appeased by Fed Chairman Jerome Powell’s insistence that interest rate hikes were a “ways away” as the Fed handed down its latest policy decision during the previous week, liftings the yellow metal to a two-week peak. However, Fed Governor Christopher Waller said on Monday that the central bank could begin asset tapering by October 2021 if the next two U.S. jobs report each show employment rising by 800,000 to 1 million. The latest jobs report, including non-farm payrolls, will be released on Friday. In Asia Pacific, the Reserve Bank of Australia kept its interest rate unchanged at 0.10% as it handed down its policy decision earlier in the day. The Bank of England and Reserve Bank of India will hand down their decisions on Thursday and Friday respectively.
  • Crude oil prices reversed course after an early bounce on Tuesday, as concerns over coronavirus curbs combined with slowing factory activity in key markets weighed on sentiment. Both markets dropped more than 3% on Monday. ANZ analysts in a note highlighted resurgent economic risks to major oil consumer China from the coronavirus pandemic. They also flagged slowing manufacturing activity as a key concern, to both China and the United States. Asian stocks were mostly negative on Tuesday as the Delta coronavirus variant spread in key markets and Chinese officials took aim at video game producers, once more rattling investor confidence in the mainland's markets. Meanwhile, Iran will respond promptly to any threat against its security, the foreign ministry said on Monday, after the United States, Israel and Britain blamed Tehran for an attack on an Israeli-managed tanker off the coast of Oman. Elsewhere, U.S. crude and product inventories likely declined last week with both distillates and gasoline stockpiles predicted to have fallen for a third straight week, a preliminary Reuters poll showed on Monday.

 

 
Intraday RESISTANCE LEVELS
3rd August 2021 R1 R2 R3
GOLD-XAU 1,812-1,820 1,833 1,840-1,845
Silver-XAG 26.00-26.50 26.90 27.50-28.20
Crude Oil 71.65-71.90 72.60 73.00-73.40
EURO/USD 1.1910 1.1990 1.2040-1.2080
GBP/USD 1.3955-1.4020 1.4050 1.4120-1.4150
USD/JPY 109.60-110.50 111.70 112.50-113.00

Intraday SUPPORTS LEVELS
3rd August 2021 S1 S2 S3
GOLD-XAU 1,800-1,791 1,780 1,767-1,760
Silver-XAG 25.20-25.05 24.75 24.50-24.00
Crude Oil 71.00-70.40 69.50 68.80-68.00
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 109.10 108.50 107.50-106.80

Intra-Day Strategy (3rd 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 Tuesday made its intraday high of US$1819.45/oz and low of US$1805.68/oz. Gold down 0.022% at US$1813.46/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     1,800-1,791
S2     1,780
S3     1,767-1,760
Intraday Resistance Levels
R1     1,812-1,820
R2     1,833
R3     1,840-1,845

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$25.62/oz and low of US$25.28/oz settled down by % at US$25.38 /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     25.20-25.05
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$73.51/bbl, intraday low of US$70.21/bbl and settled down by 3.134% to close at US$71.09/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 71.00-68.00 with risk daily closing below 68.00 and targeting 71.65-71.90-72.60 and 73.40-74.00-74.50. Sell in between 71.65-73.40 with stop loss at 73.40; targeting 71.00-70.40-69.50 and 68.80-68.00.

 
Intraday Support Levels
S1     71.00-70.40
S2     69.50
S3     68.80-68.00

Intraday Resistance Levels
R1     71.65-71.90
R2     72.60
R3     73.00-73.40

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 Monday an intraday low of US$1.1858/EUR, high of US$1.1896/EUR and settled the day up by 0.0252% to close at US$1.1867/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 Monday made an intra‐day low of US$1.3874/GBP, high of US$1.3931/GBP and settled the day down by 0.0957% to close at US$1.3877/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 Monday made intra‐day low of JPY109.18/USD and made an intraday high of JPY109.76/USD and settled the day down 0.281% at JPY109.29/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 109.10-106.50 with targets of 110.90-111.70-112.20 with stop below 106.00. Sell below 110.00-114.50 with risk above 114.50 targeting 109.00-108.50-108.0 and 107.50-106.80.

 
Intraday Support Levels
S1     109.10
S2     108.50
S3     107.50-106.80

INTRADAY RESISTANCE LEVELS
R1     109.60-110.50
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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