AAFX TRADING

Daily Market Lookup

  • The dollar edged higher on Monday after two consecutive sessions of losses as hedge funds ramped up their holdings as widening concerns about the Chinese property sector and resilient U.S. Treasury yields boosted the appeal of the greenback. After spending the second quarter of 2021 on the back foot the dollar has received a fresh boost in recent weeks, climbing to its highest levels in a year against its rivals last week as top investment banks have revised up their forecasts. Citigroup strategists expect more upside in the dollar due to challenges in the Chinese real estate sector, higher U.S. yields not driven by a global economic recovery and the negative impact for energy importers. Shares in embattled developer China Evergrande were halted in Hong Kong, rekindling market nerves about the possibility of contagion. The dollar's gains were more pronounced against some of its top rivals with the greenback scaling a 14-month high on the euro and a 19-month peak versus the yen last week as markets reckoned U.S. interest rates could rise ahead of global peers. In early London trading on Monday, the euro dipped back below $1.16 and at $1.1598 is not far from last week's trough at $1.1563. Versus a basket of its rivals, the dollar edged 0.1% higher at 94.04, breaking a two-day losing streak. The offshore yuan weakened about 0.3%. Latest weekly positioning data showed hedge funds have increased their dollar holdings against its rivals to its highest levels since November 2019. The dollar's gains has also infused life in the moribund currency volatility markets with a gauge measuring daily swings rising to its highest levels in 2-1/2 months at 6.2%. With Chinese markets shut for a holiday, traders attention will be firmly focused on monthly U.S. jobs data on Friday that analysts believe will pave the way for U.S. policymakers to strike a more hawkish tone. Yields on benchmark 10-year U.S. Treasury debt were holding near their highest levels in more than three months at 1.47%. Friday's U.S. labour data is expected to show continued improvement in the job market, with a forecast for 460,000 jobs to have been added in September - enough to keep the Federal Reserve on course to begin tapering before year's end.
  • The dollar edged lower in early European trade Monday, but remained just below last week’s highs given the on-going concerns over China’s property sector ahead of key U.S. employment data The dollar has benefited from risk aversion after shares in the highly indebted China Evergrande were halted in Hong Kong, following on from the property developer missing a key interest payment for the second time last week. This rekindled market worries about the possibility of global contagion as Evergrande is struggling to refinance over $300 billion in liabilities. That said, the focus for most of this week will be on Friday’s nonfarm payrolls release, with a strong number likely to confirm the view that the Federal Reserve will start its asset purchase tapering before the year end, and then rate hikes starting in 2022 or early in 2023. This labor release is expected to show continued improvement in the job market, with a forecast for 460,000 jobs to have been added in September, up from 235,000 jobs added the previous month. In the week ahead, the Reserve Bank of Australia meets on Tuesday and is expected to keep policy steady, while the Reserve Bank of New Zealand is expected to hike by 25 basis points on Wednesday.
  • OPEC and its allies are likely to stick to their existing agreement to add 400,000 barrels per day (bpd) of oil to the market in November, three OPEC+ sources said on Monday, despite consumer pressure for more supply to cool a red hot market. Ministers from The Organization of the Petroleum Exporting Countries, Russia and their allies, known as OPEC+, are due to gather online at 1300 GMT. An OPEC+ ministerial panel that monitors market developments, known as JMMC, meets before that. Benchmark Brent crude, up 50% so far this year, surged above $80 a barrel last month and was trading around $79 on Monday, supported by supply disruptions and surging demand as the global economy recovers from the COVID-19 pandemic. OPEC+ agreed in July to boost output by 400,000 bpd every month until at least April 2022 to phase out 5.8 million bpd of existing production cuts by the group, which slashed output in 2020 when the pandemic destroyed demand. Last week, OPEC+ sources had said producers were considering adding more than the deal envisaged, but none had given details on how much more or suggested any timing. The last meeting of OPEC+ ministers decided on October volumes. Iraqi Oil Minister Ihsan Abdul Jabbar said on Sunday that oil prices at $100 a barrel would not be sustainable and said OPEC wanted stable markets A senior aide to U.S. President Joe Biden met Saudi Crown Prince Mohammed bin Salman in Saudi Arabia last week to discuss the war in Yemen but also said oil was "of concern". India, another big oil consumer, has been pushing for more supply. In a note published on Friday, JP Morgan analysts said: "Considering the declining refinery runs and weakening physical market indicators in China we do not see the incentive for the OPEC+ alliance to boost oil production beyond the currently-committed 400,000 bpd." The oil price rally to a three-year high is exacerbated by an even bigger increase in gas prices, which have spiked 300% and have come to trade close to an equivalent of $200 per barrel due to supply shortages and low production of other fuels. Rising fuel and power prices are feeding inflationary pressures worldwide and slowing the recovery.

 

 
Intraday RESISTANCE LEVELS
4th October 2021 R1 R2 R3
GOLD-XAU 1,760-1,770 1,779 1,790-1,804
Silver-XAG 22.60-22.90 23.50 23.75-24.05
Crude Oil 75.70-76.30 77.00 77.50-78.00
EURO/USD 1.1640-1.1750 1.1800 1.1850-1.1910
GBP/USD 1.3610-1.3670 1.3710 1.3750-1.3790
USD/JPY 111.70-112.50 113.00 113.50-114.00

Intraday SUPPORTS LEVELS
4th October 2021 S1 S2 S3
GOLD-XAU 1,724 1,724 1,760-1,770
Silver-XAG 22.20-21.50 21.00 20.50-19.90
Crude Oil 74.90-74.20 73.50 72.50-71.90
EURO/USD 1.1590-1.1560 1.1510 1.1460-1.1420
GBP/USD 1.3560-1.3510 1.3560-1.3510 1.3400-1.3340
USD/JPY 111.10-110.50 109.50 109.10-108.40

Intra-Day Strategy (4th October 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 Friday made its intraday high of US$1764.23/oz and low of US$1749.66/oz. Gold up 0.245% at US$1760.83/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 1745-1700 with risk below 1700, targeting 1760-1767 and 1774-1784-1790. Sell in between 1760-1800 keeping stop loss closing above 1805, targeting 1745-1737-1728 and 1718-1710.

 
Intraday Support Levels
S1     1,724
S2     1,724
S3     1,760-1,770
Intraday Resistance Levels
R1     1,760-1,770
R2     1,779
R3     1,790-1,804

Technical Indicators

Name   Value Action
14DRSI  

39.689

Buy
20-DMA   1785.25 Sell
50-DMA  

1793.48

Sell
100-DMA   1799.92 Sell
200-DMA   1801.83 Sell
STOCH(5,3)   25.254 Buy
MACD(12,26,9)   -8.653 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$22.57/oz and low of US$21.98/oz settled up by 1.628% at US$22.53/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 22.20-19.55, targeting 22.60-22.90-23.50 and 24.45-25.05-25.50 with stop loss should be place on the breakage below 21.90. Sell in between 22.60-24.70 with stop loss above 25.00; targeting 21.50-21.00-20.50 and 19.90-19.55.

 
Intraday  Support Levels
S1     22.20-21.50
S2     21.00
S3     20.50-19.90

Intraday  Resistance Levels
R1     22.60-22.90
R2     23.50
R3     23.75-24.05

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.481 Buy
20-DMA   22.82 Sell
50-DMA   23.72 Sell
100-DMA   24.54 Sell
200-DMA   24.75 Buy
STOCH(5,3)   14.556 Sell
MACD(12,26,9)   -0.587 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$75.79/bbl, intraday low of US$74.04/bbl and settled up by 0.841% to close at US$75.52/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 75.70-77.50 with stop loss at 77.50; targeting 74.90-74.20-73.50 and 72.50-71.90-70.95. Buy above 74.90-71.10 with risk daily closing below 71.10 and targeting 74.90-75.50-76.30 and 77.00-77.50-78.00.

 
Intraday Support Levels
S1     74.90-74.20
S2     73.50
S3     72.50-71.90

Intraday Resistance Levels
R1     75.70-76.30
R2     77.00
R3     77.50-78.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.554 Sell
20-DMA   71.91 Buy
50-DMA   70.38 Buy
100-DMA   68.57 Buy
200-DMA   63.85 Buy
STOCH(5,3)   58.130 Sell
MACD(12,26,9)   1.560 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1562/EUR, high of US$1.1606/EUR and settled the day up by 0.137% to close at US$1.1596/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 1.1640-1.1910 targeting 1.1590-1.1550 and 1.1510-1.1460-1.1420 with stop-loss at daily closing above 1.1910. Buy above 1.1590-1.1410 with risk below 1.1410, targeting 1.1640-1.1750-1.1800-1.1985 and 1.2050-1.2100.

 
Intraday Support Levels
S1     1.1590-1.1560
S2     1.1510
S3     1.1460-1.1420

Intraday  Resistance Levels
R1     1.1640-1.1750
R2     1.1800
R3     1.1850-1.1910

TECHNICAL INDICATORS
Name   Value Action
14DRSI   32.720 Buy
20-DMA   1.1759 Sell
50-DMA   1.1798 Sell
100-DMA   1.1854 Sell
200-DMA   1.1867 Sell
STOCH(5,3)   41.891 Buy
MACD(12,26,9)   -0.003 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3433/GBP, high of US$1.3575/GBP and settled the day up by 0.565% to close at US$1.3546/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 1.3610-1.3790 with targets at 1.3560-1.3510-1.3450 and 1.3400-1.3340-1.3290 with stop loss should be 1.3790. Buy above 1.3560-1.3340 with targets 1.3610-1.3670-1.3710 and 1.3750-1.3790 with stop loss closing below 1.3550.

 
Intraday Support Levels
S1     1.3560-1.3510
S2     1.3560-1.3510
S3     1.3400-1.3340

Intraday Resistance Levels
R1     1.3610-1.3670
R2     1.3710
R3     1.3750-1.3790

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

46.305

Buy
20-DMA   1.3748 Buy
50-DMA   1.3791 Buy
100-DMA   1.3816 Buy
200-DMA   1.3723 Buy
STOCH(5,3)   38.146 Sell
MACD(12,26,9)   0.00032 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY110.90/USD and made an intraday high of JPY111.48/USD and settled the day up 0.619% at JPY111.04/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 111.60-108.50 with targets of 111.70-112.50 and 113.00-113.50 with stop below 106.00. Sell below 112.0-114.00 with risk above 114.00 targeting 111.10-110.50-109.60 and 109.00-108.50-108.00.

 
Intraday Support Levels
S1     111.10-110.50
S2     109.50
S3     109.10-108.40

INTRADAY RESISTANCE LEVELS
R1     111.70-112.50
R2     113.00
R3     113.50-114.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.610 Buy
20-DMA   109.97 Sell
50-DMA   109.90 Sell
100-DMA   109.59 Sell
200-DMA   108.77 Sell
STOCH(9,6)   96.683 Buy
MACD(12,26,9)   -0.0131 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING