AAFX TRADING

Daily Market Lookup

  • The dollar edged lower in early European trading Thursday, as signs of cooling U.S. inflation relieved the pressure on the Federal Reserve to start reining in its massive bond-buying program. The U.S. consumer price index increased 0.5% last month after climbing 0.9% in June, the largest drop in the month-to-month inflation rate in 15 months. Excluding the volatile food and energy components, the CPI rose 0.3% after increasing 0.9% in June. That was the smallest gain in four months and the first deceleration in the so-called core CPI since February. Fed Chair Jerome Powell has consistently said high inflation numbers will turn out to be transitory as the economy fully reopens, limiting the need to quickly tighten monetary policy, and these figures will provide some support to this view. That said, the weakness in the greenback is limited, with many analysts still expecting the Fed to announce a tapering of stimulus this year, potentially as soon as next month. This point of view was backed up Wednesday by comments from Kansas City Fed President Esther George, who indicated that the standard for reducing the central bank’s bond-buying program may have already been met given the current levels of inflation and recent labor market improvements. This report is likely to invigorate discussions about fewer asset purchases from the Bank of England. Turkey’s central bank raised its inflation expectations in its latest quarterly report on July 29 but projected a significant drop in price growth in the final quarter.
  • The dollar held near a four-month peak against major peers on Thursday after retreating overnight as a cooling in consumer inflation tempered bets for an earlier tightening of U.S. monetary policy. The euro was little changed at $1.17435 after retreating from a four-month low of $1.1706 on Wednesday, which brought it just two tenths of a cent from the weakest level since early November. The consumer price index rose 0.5% last month, in line with economist estimates but down from the 0.9% advance in June. Inflation eased in some areas where Fed policymakers had indicated price pressures would likely prove temporary, such as used cars. The Fed has made a labour market recovery a condition for phasing out its asset purchase programme and raising interest rates, while generally viewing current inflationary pressures as transitory, although there has been debate about how long those pressures could last. De Garis says a taper announcement is likely to come in November or December, but could possibly come next month. Kansas City Fed President Esther George said on Wednesday the standard for reducing the bond-buying programme may have already been met by the current spike in inflation, recent labour market improvements and the expectation for continued strong demand. Dallas Fed President Robert Kaplan, in an interview with CNBC, said the U.S. central bank should announce its timeline for reducing massive bond purchases next month and start tapering them in October. In an interview with Reuters, Richmond Fed President Thomas Barkin said it may take a few months more for the U.S. job market to recover enough that the Fed can start to reduce its support for the economy. Mundy expects a taper announcement in September if jobs data for August remains strong.
  • Oil prices slipped on Thursday following two days of gains after a call from the United States, the world's top oil consumer, for major producers to boost output reinforced supply concerns as economies ease their coronavirus restrictions. Biden's administration on Wednesday urged the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to boost oil output to tackle rising gasoline prices that they see as a threat to the global economic recovery. OPEC agreed in July to boost output each month by 400,000 bpd over the previous month, starting in August, until the rest of their record cuts of 10 million bpd, about 10% of world demand, made in 2020 are phased out. However, there are still concerns that the increase will not be enough to meet demand as the U.S. and Europe ease their coronavirus-induced movement restrictions. Later, the White House said its outreach to OPEC+ is ongoing and aimed at long-term engagement, not necessarily an immediate response. The administration added it had not called upon U.S. producers to ramp up production, which led the market to turn higher on Wednesday, said Phil Flynn, a senior analyst at Price Futures Group in Chicago. Other data from the EIA report weighed on prices. U.S. crude oil stockpiles fell modestly last week, out of step with forecasts, while gasoline inventories dipped to their lowest level since November. More volatile weekly demand numbers also declined. Oil prices were earlier boosted by a pullback in U.S. dollar, which can send speculative investors into greenback-denominated assets like commodities, and also after the U.S. Senate late on Tuesday passed a $1 trillion infrastructure bill.

 

 
Intraday RESISTANCE LEVELS
12th 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 68.80 69.45 70.30-70.90
EURO/USD 1.1750-1.1800 1.1850 1.1910-1.1990
GBP/USD 1.3860-1.3955 1.4020 1.4050-1.4120
USD/JPY 110.50 111.70 112.50-113.00

Intraday SUPPORTS LEVELS
12th 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 68.05-67.00 66.50 65.45-64.90
EURO/USD 1.1705-1.1640 1.1500-1.1460 1.1500-1.1460
GBP/USD 1.3810-1.3750 1.3696 1.3615-1.3550
USD/JPY 110.00-109.60 109.10 108.50-107.50

Intra-Day Strategy (12th 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 Wednesday made its intraday high of US$1754.34/oz and low of US$1723.96/oz. Gold up 1.298% at US$1751.38/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 1751-1684 with risk below 1684, targeting 1760-1767-1780 and 1,791-1805. Sell in between 1760-1805 keeping stop loss closing above 1805, targeting 1751-1742-1731 and 1716-1705.

 
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 Wednesday made its intraday high of US$23.57/oz and low of US$23.19/oz settled up by 0.874% at US$23.53/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 Wednesday made an intra‐day high of US$69.20/bbl, intraday low of US$69.14/bbl and settled up by 1.225% to close at US$69.14/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 68.80-70.90 with stop loss at 70.90; targeting 67.40-66.90-66.50 and 65.40-64.90-64.00. Buy above 68.00-64.00 with risk daily closing below 64.00 and targeting 68.05-68.80-69.45 and 70.30-70.90.

 
Intraday Support Levels
S1     68.05-67.00
S2     66.50
S3     65.45-64.90

Intraday Resistance Levels
R1     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 Wednesday an intraday low of US$1.1705/EUR, high of US$1.1753/EUR and settled the day up by 0.156% to close at US$1.1738/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     1.1500-1.1460
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 Wednesday made an intra‐day low of US$1.3801/GBP, high of US$1.3886/GBP and settled the day down by 0.165% to close at US$1.3861/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 1.3900-1.4120 with targets at 1.3810-1.3750 and 1.3685-1.3600-1.3520 stop-loss should be 1.4120. Buy above 1.3810-1.3600 with targets 1.3860-1.3955-1.4020 and 1.4050-1.4120 with stop loss closing below 1.3600.

 
Intraday Support Levels
S1     1.3810-1.3750
S2     1.3696
S3     1.3615-1.3550

Intraday Resistance Levels
R1     1.3860-1.3955
R2     1.4020
R3     1.4050-1.4120

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 Wednesday made intra‐day low of JPY110.30/USD and made an intraday high of JPY110.79/USD and settled the day down 0.130% at JPY110.40/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
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