AAFX TRADING

Daily Market Lookup

  • The dollar rose to a one-week peak against peers on Wednesday, buoyed by higher Treasury yields and a weaker euro a day ahead of a European Central Bank policy decision. The dollar index tumbled to its lowest levels since early August at the end of last week, when a surprisingly soft U.S. payrolls report prompted speculation the Federal Reserve will forgo announcing a taper of its stimulus at this month's policy meeting. At the same time, strong wage growth warned of the potential for inflationary pressures to grow. This week's dollar strength appears to be the result of a shift in investor focus to wage growth, which "suggests that the Fed may stick with its tapering plan," Ken Cheung, a strategist at Mizuho Bank in Hong Kong, wrote in a report. However, the surge in COVID-19 deaths in the United States could give the central bank pause. Reuters data shows that more than 20,800 people died from the virus in the past two weeks, up about two-thirds from the prior comparable period. President Joe Biden will outline a plan to tackle the highly contagious Delta variant on Thursday Investors will look to a speech by New York Fed President John Williams later on Wednesday for any hints on whether the labour market is still on the Fed's stated path of "substantial further progress" needed for a taper St. Louis Fed president James Bullard told the Financial Times that the central bank should go forward with a plan to start trimming stimulus this year despite the jobs slowdown last month. Elsewhere, the Reserve Bank of Australia's decision on Tuesday to forge ahead with a taper of bond purchases while adding the dovish concession of extending the programme to February, helped undermine the Aussie dollar. It slipped 0.3% to $0.7366 on Wednesday, extending the previous session's 0.7% slide Lower oil prices weighed, while investors anticipate a dovish narrative from the Bank of Canada's policy meeting later Wednesday following an unexpected economic contraction last quarter, NAB's Catril said Meanwhile, cryptocurrencies struggled to rebound from hefty losses overnight, when several trading platforms said they experienced performance issues, although it was not clear if these were a contributor to, or a result of, the volatility. This yield soared in the wake of Friday's disappointing jobs report, which the market took to suggest that the Federal Reserve’s tapering of its bond-buying program would be delayed despite a spate of high inflation prints. The weak report added to fears that the rise in Covid cases, with the United States having recorded roughly 650,000 deaths and last week exceeded 40 million cases, would stunt U.S. economic growth in the second half of the year. Influential investment bank Goldman Sachs (NYSE:GS) earlier this week cut its estimate for 2021 GDP growth in the U.S. to 5.7% from 6.2%. lso attracting a degree of caution is the upcoming meeting of the European Central Bank, with discussions about the potential scaling back of its monetary stimulus becoming more vocal. Ahead of Thursday’s meeting, both the Bank of Canada and Poland’s central bank are due to meet later Wednesday. The BoC isn’t expected to change monetary policy at this meeting, particularly after disappointing second-quarter GDP data. The Polish central bank is also expected to leave its benchmark at a record-low 0.1%, where it has been for well over a year, but the European Union’s fastest inflation is putting pressure on the bank to lift interest rates.
  • Oil prices climbed on Wednesday, recouping some overnight losses from a stronger dollar and demand concerns, with a slow production restart in the U.S. Gulf of Mexico and resumption of refining activities providing support. Producers in the Gulf are still struggling to restart operations nine days after Hurricane Ida swept through the region with powerful winds and drenching rain. About 79% of U.S. Gulf production remained offline on Tuesday, with 79 production platforms still unoccupied. About 17.5 million barrels of oil has been lost to the market so far. Only about 1 million barrels per day of capacity was temporarily closed, down from a peak of more than 2 million bpd, ING said, citing the latest situation report from the Department of Energy. Traders will be closely watching inventory data from the American Petroleum Institute industry group due on Wednesday and the U.S. Energy Information Administration on Thursday for a clearer picture of the storm's impact on crude production and refinery output. Analysts polled by Reuters expect, on average, that crude stocks fell by 3.8 million barrels in the week to Sept. 3, and see gasoline stocks down by 3.6 million barrels and distillates down by 3 million barrels. Oil prices fell on Tuesday in a widespread commodity selloff as the U.S. dollar jumped on worries that rising COVID-19 cases in the United States and Asia will potentially lead to slower growth. Investors now await U.S. crude oil supply data from the American Petroleum Institute, due later in the day. The data is expected to provide a clearer picture of Ida’s impact on crude production and refinery output. On the fuel demand side, the spread of COVID-19's Delta variant continues to cloud the outlook and halted oil’s recent rally. China, the world’s largest oil importer, has seemingly curbed its latest outbreak and the market is expected to tighten through the end of 2021 However, the number of daily COVID-19 cases reached a one-year high in Singapore and the city could re-impose restrictive measures. The Philippines has also paused easing curbs in the capital region. The U.S. death toll also topped 650,000 as of Sep. 8, according to Johns Hopkins University data.

 

 
Intraday RESISTANCE LEVELS
8th September 2021 R1 R2 R3
GOLD-XAU 1,805-1,810 1,819 1,830-1,840
Silver-XAG 24.45-24.75 25.50 26.00-26.70
Crude Oil 69.10-69.55 70.10 71.50 -71.90
EURO/USD 1.1850-1.1910 1.1950 1.1985-1.2050
GBP/USD 1.3810-1.3850 1.3900 1.3950-1.3990
USD/JPY 110.50-111.70 112.50 113.00-113.50

Intraday SUPPORTS LEVELS
8th September 2021 S1 S2 S3
GOLD-XAU ¬1,790-1,784 1,767 1,760-1,751
Silver-XAG 24.20-23.75 23.30 22.90-22.50
Crude Oil 68.30-67.15 66.80 66.00-65.40
EURO/USD 1.1800 1.1750 1.1705-1.1640
GBP/USD 1.3720-1.3670 1.3610 1.3571-1.3510
USD/JPY 109.60-109.10 108.40 107.45-107.00

Intra-Day Strategy (8th September 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$1827.22/oz and low of US$1792.33/oz. Gold down 1.585% at US$1794.21/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 1805-1819-1830 and 1840-1850-1861. Sell in between 1805-1861 keeping stop loss closing above 1861, targeting 1790-1784 and 1767-1760-1751.

 
Intraday Support Levels
S1     ¬1,790-1,784
S2     1,767
S3     1,760-1,751
Intraday Resistance Levels
R1     1,805-1,810
R2     1,819
R3     1,830-1,840

Technical Indicators

Name   Value Action
14DRSI  

49.744

Buy
20-DMA   1801.67 Sell
50-DMA  

1801.06

Sell
100-DMA   1804.52 Sell
200-DMA   1804.17 Sell
STOCH(5,3)   26.254 Buy
MACD(12,26,9)   4.653 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$24.81/oz and low of US$24.15/oz settled down by % at US$24.29/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 24.20-21.90, targeting 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 24.45-26.70 with stop loss above 26.00; targeting 23.75-23.25-22.90 and 22.50-22.10-21.90.

 
Intraday  Support Levels
S1     24.20-23.75
S2     23.30
S3     22.90-22.50

Intraday  Resistance Levels
R1     24.45-24.75
R2     25.50
R3     26.00-26.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.250 Buy
20-DMA   24.12 Sell
50-DMA   24.71 Sell
100-DMA   25.28 Sell
200-DMA   25.11 Buy
STOCH(5,3)   81.556 Buy
MACD(12,26,9)   -0.108 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$69.24/bbl, intraday low of US$67.48/bbl and settled down by 0.714% to close at US$68.17/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 69.00-71.90 with stop loss at 71.90; targeting 68.3-67.90 and 67.25-66.50. Buy above 68.30-65.40 with risk daily closing below 65.05 and targeting 69.00-69.55-70.10 and 70.95-71.50-71.90.

 
Intraday Support Levels
S1     68.30-67.15
S2     66.80
S3     66.00-65.40

Intraday Resistance Levels
R1     69.10-69.55
R2     70.10
R3     71.50 -71.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.125 Sell
20-DMA   68.14 Buy
50-DMA   68.57 Buy
100-DMA   67.19 Buy
200-DMA   62.41 Buy
STOCH(5,3)   39.130 Sell
MACD(12,26,9)   0.9685 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1836/EUR, high of US$1.1884/EUR and settled the day down by 0.258% to close at US$1.1838/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 1.1850-1.2050 targeting 1.1850-1.1800-1.1750 and 1.1640-1.1601-1.1550 with stop-loss at daily closing above 1.1910. Buy above 1.1800-1.1640 with risk below 1.1640, targeting 1.1910-1.1950-1.1985 and 1.2050-1.2100.

 
Intraday Support Levels
S1     1.1800
S2     1.1750
S3     1.1705-1.1640

Intraday  Resistance Levels
R1     1.1850-1.1910
R2     1.1950
R3     1.1985-1.2050

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$1.3766/GBP, high of US$1.3855/GBP and settled the day down by 0.210% to close at US$1.3783/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 1.3790-1.3990 with targets at 1.3720-1.3615-1.3571 and 1.3550-1.3510 stop-loss should be 1.3890. Buy above 1.3720-1.3550 with targets 1.3810-1.3860-1.3890 and 1.3955-1.3990 with stop loss closing below 1.3550.

 
Intraday Support Levels
S1     1.3720-1.3670
S2     1.3610
S3     1.3571-1.3510

Intraday Resistance Levels
R1     1.3810-1.3850
R2     1.3900
R3     1.3950-1.3990

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

42.637

Buy
20-DMA   1.3767 Buy
50-DMA   1.3825 Buy
100-DMA   1.3840 Buy
200-DMA   1.3713 Buy
STOCH(5,3)   71.146 Buy
MACD(12,26,9)   -0.004 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY109.67/USD and made an intraday high of JPY110.31/USD and settled the day up 0.388% at JPY110.25/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 110.54-111.70-112.50 and 113.00-113.50 with stop below 106.00. Sell below 110.50-113.50 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     110.50-111.70
R2     112.50
R3     113.00-113.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.047 Buy
20-DMA   109.89 Sell
50-DMA   109.87 Sell
100-DMA   109.48 Sell
200-DMA   108.60 Sell
STOCH(9,6)   41.683 Sell
MACD(12,26,9)   0.0131 Sell

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