AAFX TRADING

Daily Market Lookup

  • The dollar hit a four-month high versus the euro on Tuesday after upbeat U.S. jobs data bolstered expectations that the Federal Reserve could soon start tapering its massive bond-buying programme. Analysts said the dollar was getting support from rising U.S. bond yields, as the prospect of reduced Fed stimulus weakened bond prices. U.S. job openings, a measure of labour demand, hit a record high in June while hiring also increased, the Labor Department said in a monthly survey on Monday. That followed Friday's non-farm payroll report showing jobs increased by 943,000 in July, above the 870,000 forecast by economists in a Reuters poll. The dollar index strengthened on Friday and Monday, and reached an 18-day high of 93.02 during Asian trading hours on Tuesday. Attention now turns to U.S. consumer inflation data due on Wednesday, which could provide more cues on the timing of the Fed's bond-purchase taper. Although there is talk among analysts of the market being "data-driven", U.S. jobs market and inflation statistics are difficult to interpret, Commerzbank (DE:CBKG) Ulrich Leuchtmann wrote in a client note. Atlanta Federal Reserve Bank President Raphael Bostic, speaking after the jobs data, said he was eyeing the fourth quarter for the start of a bond-purchases taper, but was open to an earlier move. Boston Federal Reserve Bank President Eric Rosengren said the Fed should announce September that it will reduce asset purchases in the autumn. Elsewhere, risk appetite was harmed by worries about growth in China and the fast-spreading Delta coronavirus variant, which led to oil prices hitting a three-week low in the previous session. Hardman said he expected the Reserve Bank of New Zealand (RBNZ) to raise its rate by 0.25 basis points this month.
  • The dollar pushed higher in early European trading Tuesday, as a series of strong jobs releases raised expectations of an early tapering of the U.S. Federal Reserve’s massive monetary stimulus. Helping the dollar’s tone was the release of the U.S. Labor Department’s monthly Job Openings and Labor Turnover Survey on Monday, which showed that job openings increased by 590,000 to a record-high 10.1 million on the last day of June. This followed on from Friday’s official U.S. jobs report, where nonfarm payrolls rose by 943,000 in July, more than expected, while numbers for May and June were also revised up. This labor market strength has prompted the market to reassess when the Federal Reserve will start to rein in its $120 billion asset-purchase program, potentially starting to taper this year with higher interest rates following as soon as 2022. Federal Reserve policymakers have also started to guide the market towards an early tapering. Atlanta Fed President Raphael Bostic stated Monday he is eyeing the fourth quarter, if not earlier, for the start of a bond-purchase taper, while his colleague from Boston, Eric Rosengren, suggested September for the tapering announcement. The next major event risk for the foreign exchange markets will be the release of U.S. consumer inflation data on Wednesday, particularly as the question over whether a well-flagged and gradual tapering could still upset asset markets. This report has raised expectations that the central bank may shortly announce another reduction in the reserve requirement ratio for banks after July’s surprise cut. A stronger-than-expected U.S. jobs report, released during the previous week, saw U.S. Treasury yields climb to three-week highs and a broad rally for the U.S. currency. Atlanta Fed Bank President Raphael Bostic said on Monday that he expects asset tapering to begin in the fourth quarter, but that an even earlier move could be possible should the jobs market maintain its recent pace of improvement. In Asia Pacific, expectations of an interest rate hike by the Reserve Bank of New Zealand when it hands down its policy decision in the following week continued to give the New Zealand a small boost.
  • Oil prices rose more than $1 on Tuesday, recouping some of the losses in the previous session, as rise of demand in Europe and the United States outweighed concerns over a rise of COVID cases in Asian countries. Both contracts dropped around 2.5% on Monday, but analysts believe the pandemic setback will not last for long. U.S. crude, gasoline, and other product inventories are likely to have dropped last week, with gasoline stocks forecast to fall for a fourth consecutive period, a preliminary Reuters poll showed on Monday. Crude oil inventories are expected to have fallen by about 1.1 barrels in the week to Aug. 6, according to the average estimate of six analysts polled by Reuters. In the United States, the Senate is set to vote on the passage of a $1 trillion infrastructure bill later on Tuesday, which, if passed would boost the economy and demand for oil products, analysts said. Successful vaccination programmes in the West and encouraging economic data come in sharp contrast to the rising infection in the East. In Australia, the police force is on the street to enforce COVID-related restrictions and some cities in China, the world's top crude oil importer, have stepped up mass testing as authorities try to stamp out a new surge of the virus. Economic data this week, especially the U.S. Consumer Price Index on Wednesday, will provide guidance on how hard the virus will hit global and regional oil consumption, analysts said. Oil was up Tuesday morning in Asia, clawing back some losses from the previous session that saw the black liquid drop to a three-week low. However, fuel demand concerns remain as COVID-19 cases continue to increase. China reported a record number of daily COVID-19 cases on Monday, as the world’s top oil importer attempts to bring this number down to zero. Restrictive measures have already been implemented in large parts of the country, which has, in turn, dampening the fuel demand outlook. Investors now await a European Union decision on whether or not to reverse the current policy that allows Americans into the block. A decision to reverse this policy would “negate what could have been a better future demand profile,” said Dwivedi. Investors also await U.S. crude oil supply data from the American Petroleum Institute, due later in the day.

 

 
Intraday RESISTANCE LEVELS
10th August 2021 R1 R2 R3
GOLD-XAU 1,742-1,751 1,760 1,767-1,780
Silver-XAG 23.75-24.00 24.45 24.75-25.05
Crude Oil 68.05-68.80 69.45 70.30-70.90
EURO/USD 1.1750-1.1800 1.1850 1.1910-1.1990
GBP/USD 1.3955-1.4020 1.4050 1.4120-1.4150
USD/JPY 110.50 111.70 112.50-113.00

Intraday SUPPORTS LEVELS
10th August 2021 S1 S2 S3
GOLD-XAU 1,731¬-1,716 1,705 1,698-1,684
Silver-XAG 23.30-22.90 22.50 22.10-21.90
Crude Oil 67.00-66.50 65.45 64.90-64.00
EURO/USD 1.1705-1.1640 1.1550 1.1500-1.1460
GBP/USD 1.3840-1.3810 1.3750 1.3696-1.3615
USD/JPY 110.00-109.60 109.10 108.50-107.50

Intra-Day Strategy (10th August 2021)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Sell
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$1764.46/oz and low of US$1684.81/oz. Gold down 1.920% at US$1729.62/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1809) and breakage below will call for 1790. 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 neutral territory and giving negative crossover to bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Buy in between 1731-1684 with risk below 1684, targeting 1742-1751-1760 and 1767-1780-1,791. Sell in between 1742-1780 keeping stop loss closing above 1780, targeting 1731-1716 and 1705-1698.

 
Intraday Support Levels
S1     1,731¬-1,716
S2     1,705
S3     1,698-1,684
Intraday Resistance Levels
R1     1,742-1,751
R2     1,760
R3     1,767-1,780

Technical Indicators

Name   Value Action
14DRSI  

28.131

Buy
20-DMA   1791.46 Sell
50-DMA  

1803.99

Sell
100-DMA   1808.40 Sell
200-DMA   1806.05 Sell
STOCH(5,3)   27.254 Buy
MACD(12,26,9)   -13.653 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$24.35/oz and low of US$22.14/oz settled down by 3.61% at US$23.43/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 23.30-21.90, targeting 24.00-24.45-25.05 and 25.50-26.00-26.65 with stop loss should be place on the breakage below 21.90. Sell in between 23.70-26.00 with stop loss above 26.00; targeting 23.25-22.90-22.50 and 22.10-21.90.

 
Intraday  Support Levels
S1     23.30-22.90
S2     22.50
S3     22.10-21.90

Intraday  Resistance Levels
R1     23.75-24.00
R2     24.45
R3     24.75-25.05

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.388 Buy
20-DMA   25.80 Sell
50-DMA   25.03 Sell
100-DMA   25.96 Sell
200-DMA   25.39 Buy
STOCH(5,3)   74.556 Buy
MACD(12,26,9)   -0.380 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$67.69/bbl, intraday low of US$65.01/bbl and settled down by 1.582% to close at US$66.60/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 Sell

Sell in between 68.05-70.90 with stop loss at 70.90; targeting 67.40-66.90-66.50 and 65.40-64.90-64.00. Buy above 67.00-64.00 with risk daily closing below 64.00 and targeting 68.05-68.80-69.45 and 70.30-70.90.

 
Intraday Support Levels
S1     67.00-66.50
S2     65.45
S3     64.90-64.00

Intraday Resistance Levels
R1     68.05-68.80
R2     69.45
R3     70.30-70.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   34.213 Sell
20-DMA   70.12 Buy
50-DMA   69.91 Buy
100-DMA   66.99 Buy
200-DMA   61.15 Buy
STOCH(5,3)   10.130 Sell
MACD(12,26,9)   0.9685 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.1734/EUR, high of US$1.1768/EUR and settled the day down by 0.160% to close at US$1.1735/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 1.1750-1.1990 targeting 1.1850-1.1800-1.1750 with stop-loss at daily closing above 1.2140. Buy above 1.1705-1.1460 with risk below 1.1460, targeting 1.1750-1.1840-1.1910 and 1.1990-1.2040-1.2100.

 
Intraday Support Levels
S1     1.1705-1.1640
S2     1.1550
S3     1.1500-1.1460

Intraday  Resistance Levels
R1     1.1750-1.1800
R2     1.1850
R3     1.1910-1.1990

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.682 Buy
20-DMA   1.1805 Sell
50-DMA   1.1903 Sell
100-DMA   1.1948 Sell
200-DMA   1.1911 Sell
STOCH(5,3)   33.758 Sell
MACD(12,26,9)   -0.0044 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3840/GBP, high of US$1.3893/GBP and settled the day down by 0.1543% to close at US$1.3846/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     1.3840-1.3810
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 JPY110.01/USD and made an intraday high of JPY110.34/USD and settled the day down 0.0589% at JPY110.22/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 110.00-106.50 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     110.00-109.60
S2     109.10
S3     108.50-107.50

INTRADAY RESISTANCE LEVELS
R1     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
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING