AAFX TRADING

Daily Market Lookup

  • The dollar edged higher Thursday, helped by concerns about the strength of the global recovery, while the euro was largely unchanged ahead of a key meeting of the European Central Bank. The dollar was hit hard by 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. However, the mood has turned a little more risk averse since, with several Fed policymakers on Wednesday signaling the U.S. central bank remains on track to reduce asset purchases this year even while rising Covid cases suggested a slowing in economic growth. Earlier Thursday, China's factory gate inflation hit a 13-year high in August, with the producer price index rising 9.5% from a year earlier in August, driven by sharply rising raw materials prices. Against this backdrop of rising global inflation, the European Central Bank will have to decide later Thursday whether the region’s economic recovery is strong enough to support an imminent reduction of its bond-buying. Expectations are running high that the central bank will announce a timeline to slow down bond purchases, but also try to reassure markets that interest rate increases are still some way off.
  • The dollar was supported on Thursday as doubts over the global economy's strength subdued risk sentiment, while the euro steadied ahead of a European Central Bank policy meeting later in the day that is expected result in a reduction in stimulus. The dollar index remained flat at 92.664, after three consecutive days of rises. And U.S. stocks to stepped back overnight from their high valuations as investors worried about the combination of slowing global growth, due in part to the spread of the COVID-19 Delta variant, and the potential tapering of central bank stimulus. The European Central Bank is expected to reduce stimulus on Thursday, taking a token step towards unwinding the emergency economic aid it put in place during the pandemic. Analysts polled by Reuters see ECB bond buying under its pandemic emergency purchase programme (PEPP) falling to possibly as low as 60 billion euros a month from the current 80 billion, before a further fall early next year and the scheme's end in March. But at the same time, the ECB is expected to signal copious support for years to come, even after PEPP expires. The Bank of Canada left its key interest rate at a record low 0.25% and maintained its current quantitative easing program on Wednesday. China's factory gate inflation hit a 13-year high in August despite Beijing's attempts to cool them while consumer inflation slowed unexpectedly in a sign of soft consumption. A firmer dollar also pressured many emerging market currencies, with the Brazilian real and the Turkish lira among the worst hit. The real tumbled almost 3% on Wednesday to 5.3214 per dollar on heightened political worries as President Jair Bolsonaro clashed with the country's Supreme Court. The Turkish lira weakened 1.4% to 8.468 per dollar after central bank Governor Sahap Kavcioglu said on Wednesday the current 19% policy rate was high enough to bring inflation down.
  • The dollar was up on Thursday morning in Asia ahead of the latest European Central Bank (ECB) policy decision. Worries about COVID-19's impact on economic recovery also gave the safe-have asset a small boost. New York Federal Reserve Bank President John Williams’s comment on Wednesday that more progress is needed in the job market before asset tapering can begin gave risk sentiment a small boost. However, the Fed is widely expected not to announce asset tapering anytime soon after the weaker-than-expected U.S. jobs report released during the previous week. Meanwhile, the ECB is likely to begin asset tapering when it hands down its policy decision later in the day. It could reduce its buying under the pandemic emergency purchase program (PEPP) as low as EUR60 billion ($75.96 billion) monthly from the current EUR80 billion, before a further fall in early 2022 and the scheme’s expiry in March 2022.
  • Oil prices rose for a second session on Thursday, recovering from earlier losses as a decline in U.S. Gulf of Mexico output following damages from Hurricane Ida underpinned the market. About 77% of U.S. Gulf production remained offline on Tuesday, or about 1.4 million barrels per day (bpd). The market has lost about 17.5 million barrels of oil so far. The Gulf's offshore wells make up about 17% of U.S. output. U.S. crude oil production is expected to fall by 200,000 barrels per day in 2021 to 11.08 million bpd, the U.S. Energy Information Administration (EIA) said on Wednesday, noting that Hurricane Ida should force a bigger decline than its previous forecast for a drop of 160,000 bpd.. American Petroleum Institute (API) data showed that crude drawdown for the week ended Sept. 3 was smaller than expected in a Reuter’s poll, but gasoline and distillate drawdowns were bigger than expected. API data showed U.S. gasoline stocks fell by 6.4 million barrels for the week ended Sept. 3, while crude stocks dropped by 2.9 million barrels. U.S. distillate stocks fell by 3.7 million barrels over the same week, API data showed. On Wednesday, oil was also supported as protesters in Libya blocked oil exports at Es Sider and Ras Lanuf, an oil engineer at each of the ports said, although other engineers said production at fields that supply the terminals was unaffected.

 

 
Intraday RESISTANCE LEVELS
9th September 2021 R1 R2 R3
GOLD-XAU 1,805-1,810 1,819 1,830-1,840
Silver-XAG 24.20-24.45 24.75 25.50-26.00
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
9th September 2021 S1 S2 S3
GOLD-XAU 1,790-1,784 1,767 1,760-1,751
Silver-XAG 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 (9th 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 Tuesday made its intraday high of US$1802.14/oz and low of US$1782.32/oz. Gold down 0.288% at US$1789.03/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 Wednesday made its intraday high of US$24.39/oz and low of US$23.89/oz settled down by 1.587% at US$23.92/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     23.75
S2     23.30
S3     22.90-22.50

Intraday  Resistance Levels
R1     24.20-24.45
R2     24.75
R3     25.50-26.00

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 Wednesday made an intra‐day high of US$69./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 Wednesday made an intraday low of US$1.1801/EUR, high of US$1.1826/EUR and settled the day down by 0.193% to close at US$1.1815/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 Wednesday made an intra‐day low of US$1.3725/GBP, high of US$1.3798/GBP and settled the day down by 0.0957% to close at US$1.3770/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 Wednesday made intra‐day low of JPY110.13/USD and made an intraday high of JPY110.44/USD and settled the day down 0.0263% 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 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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