AAFX TRADING

Daily Market Lookup

  • The dollar edged higher in early European trade Wednesday, but remained near a one-week low as confidence rises that the new surge in Covid-19 cases will have a limited impact on the global recovery. The dollar has been struggling over the last couple of days with optimism rising over the ability of the U.S. to cope with the recent surge in Covid-19 cases after the U.S. Food and Drug Administration granted full approval to the vaccine developed by Pfizer (NYSE:PFE) and BioNTech. Additionally, the Meishan terminal at China’s second-busiest port reopened Wednesday following a two-week Covid-induced shutdown, increasing confidence that the world’s second largest economy has managed to control its coronavirus outbreak. The main focus this week, though, has been the Federal Reserve’s Jackson Hole Symposium, and with the Covid outbreak clouding the outlook, expectations have dropped that Fed Chair Jerome Powell will indicate a timeline for the tapering of the central bank’s massive bond-buying program. Hungarian policy makers have indicated they’ll keep up the tightening cycle until inflation is on track to hit the central bank’s 3% target over the monetary horizon. The safe-haven dollar traded close to a one-week low versus major peers on Wednesday amid easing concerns that the highly contagious Delta coronavirus variant could derail a global economic recovery. Risk appetite in global markets has improved since the U.S. Food and Drug Administration granted full approval to the COVID-19 vaccine developed by Pfizer (NYSE:PFE) and BioNTech in a move that could accelerate U.S. inoculations. The United States could get COVID-19 under control by early next year, Dr. Anthony Fauci, the country's top infectious disease expert, said on Tuesday. However, with Delta clouding the outlook, expectations have diminished that Fed Chair Jerome Powell will indicate a timeline when he speaks at the Fed's annual economic symposium at Jackson Hole, Wyoming, on Friday. The U.S. FDA’s full approval of the Pfizer Inc. (NYSE:PFE)/BioNTech SE (F:22UAy) COVID-19 vaccine earlier in the week has raised hopes that inoculations rates will rise and has increased the global risk appetite. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases and the chief medical advisor to the President, even predicted that the U.S. could have COVID-19 under control by early 2022 if vaccination rates rise. The U.S. currency has rallied in recent weeks, even hitting a nine-and-a-half month high of 93.734 during the previous week. Concerns about the global spread of COVID-19, and the Delta variant particularly, alongside signs that the U.S. Federal Reserve could start asset tapering later in 2021, contributed to this rally. However, some investors are betting that the continuing spread of COVID-19 will diminish the chances that the Fed will announce a timeline for both asset tapering and interest rate hikes at its’ annual Jackon Hole symposium, taking place from Aug. 26 to 28.
  • Gold was down on Wednesday morning in Asia as the dollar ticked upwards and investors look to the U.S. Federal Reserve’s guidance on asset tapering and interest rate hikes. The Fed will convene for its Jackson Hole symposium, due to take place online from Aug. 26 to 28. The focus is now squarely on whether Fed Chairman Jerome Powell will provide a timeline for asset tapering in his speech on Aug. 27. Meanwhile, the Bank of Korea will hand down its policy decision on Thursday and back in the U.S., the U.S. House of Representatives adopted a $3.5. trillion budget resolution. The U.S. is also making progress on the COVID-19 front, with the FDA granted full approval of the Pfizer Inc. (NYSE:PFE)/BioNTech SE (F:22UAy) COVID-19 vaccine earlier in the week, which also contributed to investors’ increased risk appetite. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases and the chief medical advisor to the President, also predicted that the U.S. could have COVID-19 under control by early 2022 if vaccination rates rise.
  • Oil prices nudged lower on Wednesday, taking a breather after a strong rally this week spurred by the loss of a quarter of Mexico's production and signs that China, the world's biggest importer, has curbed a recent coronavirus outbreak Prices rallied following a more than 400,000 barrels per day drop in supply in Mexico after a fire on an oil platform, but the state oil firm said it expects to resume production by Aug. 30. American Petroleum Institute data showed crude inventories fell 1.6 million barrels for the week ended Aug. 20, while gasoline stockpiles fell 1 million barrels, according to sources, who spoke on condition of anonymity. Analysts were expecting crude stockpiles to fall by 2.7 million barrel and gasoline stocks to drop by 1.6 million barrels, according to a Reuters poll. Official data from the U.S. Energy Information Administration is due to be released on Wednesday at 1430 GMT. Last week's losses were driven by fears that the spread of the highly contagious Delta variant of the coronavirus in Asia would slow the region's economic recovery. In a promising sign that the spread of Delta infections was easing in China, the country on Wednesday reported just 20 new confirmed coronavirus cases for Aug. 24, down from 35 a day earlier. ANZ commodity analysts pointed to a pick-up in traffic in Beijing and Shanghai as evidence of the Delta variant being "stamped out".

 

 
Intraday RESISTANCE LEVELS
25th August 2021 R1 R2 R3
GOLD-XAU 1,805-1,817 1,830 1,840-1,849
Silver-XAG 23.75-24.00 24.45 24.75-25.50
Crude Oil 68.30-68.55 69.00 69.55-70.10
EURO/USD 1.1750-1.1800 1.1850 1.1910-1.1950
GBP/USD 1.3720-1.3750 1.3810 1.3850-1.3900
USD/JPY 110.00¬-110.50 111.70 112.50-113.00

Intraday SUPPORTS LEVELS
25th August 2021 S1 S2 S3
GOLD-XAU 1,790-1,784 1,767 1,760-1,751
Silver-XAG 23.30-22.90 22.50 22.15-21.85
Crude Oil 67.25-66.50 65.45 64.90-64.05
EURO/USD 1.1705-1.1640 1.1601 1.1550-1.1500
GBP/USD 1.3670-1.3610 1.3571 1.3550-1.3500
USD/JPY 109.60-109.10 108.40 107.45-107.00

Intra-Day Strategy (25th 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 Tuesday made its intraday high of US$1809.49/oz and low of US$1800.65/oz. Gold down 0.1379% at US$1802.77/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 1790-1743 with risk below 1743, targeting 1805-1817 and 1825-1830. Sell in between 1800-1830 keeping stop loss closing above 1830, targeting 1784-1767-1760 and 1751-1742-1734.

 
Intraday Support Levels
S1     1,790-1,784
S2     1,767
S3     1,760-1,751
Intraday Resistance Levels
R1     1,805-1,817
R2     1,830
R3     1,840-1,849

Technical Indicators

Name   Value Action
14DRSI  

37.170

Buy
20-DMA   1784.03 Sell
50-DMA  

1799.86

Sell
100-DMA   1806.12 Sell
200-DMA   1804.94 Sell
STOCH(5,3)   45.254 Buy
MACD(12,26,9)   -15.653 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$23.94/oz and low of US$23.52/oz settled up by 0.931% at US$23.83/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 23.75-26.00 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     22.15-21.85

Intraday  Resistance Levels
R1     23.75-24.00
R2     24.45
R3     24.75-25.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.923 Buy
20-DMA   24.04 Sell
50-DMA   24.96 Sell
100-DMA   25.50 Sell
200-DMA   25.20 Buy
STOCH(5,3)   51.556 Buy
MACD(12,26,9)   -0.580 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$67.70/bbl, intraday low of US$65.32/bbl and settled up by 3.23% to close at US$67.52/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 68.30-70.10 with stop loss at 70.10; targeting 67.25-66.50-65.45 and 64.90-63.20-62.60. Buy above 67.25-64.05 with risk daily closing below 64.05 and targeting 68.30-68.60-69.00 and 69.55-70.10.

 
Intraday Support Levels
S1     67.25-66.50
S2     65.45
S3     64.90-64.05

Intraday Resistance Levels
R1     68.30-68.55
R2     69.00
R3     69.55-70.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.412 Sell
20-DMA   71.84 Buy
50-DMA   69.87 Buy
100-DMA   67.12 Buy
200-DMA   61.39 Buy
STOCH(5,3)   10.130 Sell
MACD(12,26,9)   0.9685 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.1726/EUR, high of US$1.1765/EUR and settled the day up by 0.0672% to close at US$1.1752/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 1.1750-1.1910 targeting 1.1640-1.1601 and 1.1550-1.1500 with stop-loss at daily closing above 1.1910. Buy above 1.1705-1.1460 with risk below 1.1460, targeting 1.1750-1.1800 and 1.1840-1.1910-1.1990.

 
Intraday Support Levels
S1     1.1705-1.1640
S2     1.1601
S3     1.1550-1.1500

Intraday  Resistance Levels
R1     1.1750-1.1800
R2     1.1850
R3     1.1910-1.1950

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.682 Buy
20-DMA   1.1809 Sell
50-DMA   1.1979 Sell
100-DMA   1.1932 Sell
200-DMA   1.1904 Sell
STOCH(5,3)   8.891 Sell
MACD(12,26,9)   -0.003 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3607/GBP, high of US$1.3731/GBP and settled the day up by 0.679% to close at US$1.3715/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 1.3650-1.3810 with targets at 1.3615-1.3571 and 1.3550-1.3510 stop-loss should be 1.3890. Buy above 1.3690-1.3550 with targets 1.3715-1.3750-1.3810 and 1.3860-1.3890-1.3955 with stop loss closing below 1.3550.

 
Intraday Support Levels
S1     1.3670-1.3610
S2     1.3571
S3     1.3550-1.3500

Intraday Resistance Levels
R1     1.3720-1.3750
R2     1.3810
R3     1.3850-1.3900

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

38.544

Buy
20-DMA   1.3931 Buy
50-DMA   1.3820 Buy
100-DMA   1.3861 Buy
200-DMA   1.3714 Buy
STOCH(5,3)   21.940 Buy
MACD(12,26,9)   -0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY109.40/USD and made an intraday high of JPY109.68/USD and settled the day down 0.0647% at JPY109.61/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 109.60-110.00-110.90 and 111.70-112.20 with stop below 106.00. Sell below 110.00-113.50 with risk above 113.50 targeting 109.60-109.00-108.50 and 108.00-107.50-106.80.

 
Intraday Support Levels
S1     109.60-109.10
S2     108.40
S3     107.45-107.00

INTRADAY RESISTANCE LEVELS
R1     110.00¬-110.50
R2     111.70
R3     112.50-113.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.047 Buy
20-DMA   109.86 Sell
50-DMA   109.86 Sell
100-DMA   109.34 Sell
200-DMA   108.39 Sell
STOCH(9,6)   7.253 Sell
MACD(12,26,9)   0.110 Sell

AAFX TRADING
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