AAFX TRADING

Daily Market Lookup

  • The dollar nudged up against major peers on Wednesday after weakening in the past three days with investors taking little risk ahead of U.S. inflation data which could shine some light on how fast the Federal Reserve might raise interest rates. The U.S. consumer price index, due later on Wednesday, is predicted by a Reuters poll of economists to come in at an annualised 4.3%, versus the U.S Federal Reserve average annual 2% inflation target. The Fed last week restated its belief that current high inflation is transitory but many investors fear that underestimating the rise in prices could prove a costly policy mistake. Data showed on Tuesday that U.S. producer prices increased solidly in October, driven by surging costs for gasoline and motor vehicle retailing, suggesting that high inflation could persist. Hammered last week after the Bank of England's surprise decision to keep rates unchanged, sterling retreated 0.18% to $1.3535 but stood well up Friday's more than one-month low of $1.3425. Fears of potential contagion from China's property market woes also fuelled the search for safer assets. China's Evergrande faces a deadline on Wednesday to pay an offshore bond, and Kaisa Group pleaded on Tuesday for help to pay loans, workers and suppliers.
  • The dollar was up on Wednesday morning in Asia after a three-day loss, and was near a one-month low against the yen. Investors now await the latest U.S. inflation data that could provide a clue to the U.S. Federal Reserve’s timetable for interest rate hikes. The USD/CNY pair inched up 0.03% to 6.3934. Chinese data released earlier in the day showed that the consumer price index (CPI) grew 0.7% month-on-month and 1.5% year-on-year in October. The producer price index (PPI) grew by 13.5% year on year. Tuesday’s data showed that the U.S. PPI grew 0.6% month-on-month and 8.6% year-on-year in October. The core PPI grew 0.4% month-on-month, and the CPI figure is due later in the day. In the ongoing debate on when the Fed will hike interest rates, St. Louis Fed President James Bullard noted corporate pricing power and has already penciled in two interest rate hikes in 2022. San Francisco Fed President Mary Daly, on the other hand, expects “eye-popping” inflation to subside in 2022 as supply-chain bottlenecks subside. U.S. President Joe Biden met with Fed Governor Lael Brainard, a potential candidate to be the next Fed Chairman. She is considered a dovish pick, and “Brainard’s possible nomination as Fed Chair is chipping at the dollar,” Westpac analysts said in a note.
  • Oil prices rose on Wednesday, extending strong gains in the previous session, after industry data showed U.S. crude stocks unexpectedly fell last week just as near-term travel demand picked up with COVID-19 pandemic curbs easing. Both benchmarks touched their highest in two weeks earlier on Wednesday, supported by tightening global oil inventories during the past several months, and the latest data from the American Petroleum Institute reinforcing the view that supply remains constrained. According to market sources, API data showed U.S. crude stocks declined by 2.5 million barrels for the week to Nov. 5, defying analysts' estimates for a 2.1 million build in crude stocks in a Reuters poll. Growing air travel is also supporting oil demand, he said. The market will be awaiting weekly inventory data from the U.S. Energy Information Administration (EIA) on Wednesday to see whether it confirms the drawdown in crude stocks. Further underpinning the view the market remains tight, trading giant Vitol Group's CEO Russell Hardy said on Tuesday that oil demand had returned to pre-pandemic levels and that the first quarter of 2022 could see demand exceed 2019 levels. Market gains on Tuesday were mainly driven by a short-term outlook from the EIA, which projected gasoline prices would fall over the next few months. That was a key factor U.S. President Joe Biden had been watching to determine whether to release oil from the Strategic Petroleum Reserve amid concern over recent soaring gasoline prices. Tuesday’s U.S. crude oil supply data from the American Petroleum Institute (API) showed a draw of 2.5 million barrels for the week to Nov. 5. Forecasts prepared by Investing.com had predicted a 1.9-million-barrel build, while a 3.594-million-barrel build was reported during the previous week. Investors now await crude oil supply data from the U.S. Energy Information Administration (EIA), due later in the day. “Supplies are tight with the Organization of the Petroleum Exporting Countries sticking to its guns,” Phillip Futures in Singapore senior commodities manager Avtar Sandu told Reuters, in reference to the recent agreement between OPEC and allies (OPEC+) to maintain an output growth of 400,000 barrels per day in December. The growth of air travel also increases oil demand, and “I still see a bull charging on; it might be taking a break now, but (if there’s) any small spark, it might just continue its march,” said Sandu. Vitol Group CEO Russel Hardy confirmed the tight market, saying on Tuesday that oil demand had returned to pre-COVID-19 levels and there will be a demand exceeding in the first quarter of 2022. Meanwhile, a short-term outlook from the EIA said gasoline prices would fall over the next few months. This will play a key factor on whether U.S. President Joe Biden decides to release oil from the Strategic Petroleum Reserve (SPR) as prices have risen recently.

 

 
Intraday RESISTANCE LEVELS
10th November 2021 R1 R2 R3
GOLD-XAU 1,829-1,834 1,840 1,851-1,863
Silver-XAG 24.55-25.50 25.80 26.20-26.50
Crude Oil 83.10-83.60 84.50 84.95-85.50
EURO/USD 1.1590-1.1655 1.1700 1.1735-1.1795
GBP/USD 1.3605--1.3690 1.3740 1.3800-1.3830
USD/JPY 113.00-113.50 114.30 114.90-115.50

Intraday SUPPORTS LEVELS
10th November 2021 S1 S2 S3
GOLD-XAU 1,818-1,810 1,804 1,790-1,779
Silver-XAG 23.75-23.20 22.60 22.20-21.80
Crude Oil 82.50-81.90 81.40 80.50-79.90
EURO/USD 1.1540-1.1510 1.1460 1.1420-1.1350
GBP/USD 1.3530-1.3490 1.3455 1.3350-1.3310
USD/JPY 112.35-111.70 111.30 110.80-110.50

Intra-Day Strategy (10th November 2021)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Sell
EUR/USD Neutral to Buy
GBP/USD Neutral to Buy
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Tuesday made its intraday high of US$1832.60/oz and low of US$1819.07/oz. Gold up 0.398% at US$1831.68/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 1818-1770 with risk below 1770, targeting 1829-1834 and 1840-1849. Sell in between 1829-1863 keeping stop loss closing above 1849, targeting 1818-1810-1804 and 1790-1782-1774.

 
Intraday Support Levels
S1     1,818-1,810
S2     1,804
S3     1,790-1,779
Intraday Resistance Levels
R1     1,829-1,834
R2     1,840
R3     1,851-1,863

Technical Indicators

Name   Value Action
14DRSI  

61.842

Buy
20-DMA   1796.72 Buy
50-DMA  

1787.84

Buy
100-DMA   1790.61 Buy
200-DMA   1795.11 Sell
STOCH(5,3)   95.413 Sell
MACD(12,26,9)   12.203 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$24.46/oz and low of US$24.01/oz settled down by 0.678% at US$24.28/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 24.55-25.05 and 25.50-25.90 with stop loss should be place on the breakage below 21.90. Sell in between 24.55-25.90 with stop loss above 25.90; targeting 23.90-23.20-22.60 and 22.00-21.40.

 
Intraday  Support Levels
S1     23.75-23.20
S2     22.60
S3     22.20-21.80

Intraday  Resistance Levels
R1     24.55-25.50
R2     25.80
R3     26.20-26.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.284 Buy
20-DMA   23.40 Sell
50-DMA   23.54 Sell
100-DMA   24.18 Sell
200-DMA   24.51 Sell
STOCH(5,3)   73.950 Sell
MACD(12,26,9)   -0.587 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$83.33/bbl, intraday low of US$80.81/bbl and settled up by 2.587% to close at US$83.26/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 83.10-85.50 with stop loss at 85.10; targeting 82.50-81.90-80.50 and 79.90-79.40-78.40. Buy above 82.50-79.40 with risk daily closing below 79.40 and targeting 83.10-83.60-84.50 and 84.95-85.50.

 
Intraday Support Levels
S1     82.50-81.90
S2     81.40
S3     80.50-79.90

Intraday Resistance Levels
R1     83.10-83.60
R2     84.50
R3     84.95-85.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.468 Sell
20-DMA   81.07 Buy
50-DMA   77.87 Buy
100-DMA   74.09 Buy
200-DMA   68.17 Buy
STOCH(5,3)   57.485 Sell
MACD(12,26,9)   1.026 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1569/EUR, high of US$1.1608/EUR and settled the day up by 0.052% to close at US$1.1592/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.1700), which become immediate resistance level, break above will target 1.1825. MACD is above zero line and histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving positive crossovers to signal for bullish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Buy

Buy above 1.1540-1.1410 with risk below 1.1410, targeting 1.1590-1.1640-1.1750 and 1.1800-1.1985-1.2050. Sell below 1.1590-1.1800 targeting 1.1540-1.1510-1.1460 and 1.1420-1.1390 with stop-loss at daily closing above 1.1910.

 
Intraday Support Levels
S1     1.1540-1.1510
S2     1.1460
S3     1.1420-1.1350

Intraday  Resistance Levels
R1     1.1590-1.1655
R2     1.1700
R3     1.1735-1.1795

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.647 Buy
20-DMA   1.1617 Buy
50-DMA   1.1752 Sell
100-DMA   1.1752 Sell
200-DMA   1.1806 Sell
STOCH(5,3)   35.891 Sell
MACD(12,26,9)   -0.003 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3523/GBP, high of US$1.3606/GBP and settled the day down by 0.288% to close at US$1.3555/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.3760) 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 Buy

Based on the charts and explanations above; buy in between 1.3455-1.3200 with targets 1.3510-1.3560 and 1.3680-1.3750-1.3790 with stop loss closing below 1.3200. Sell in between 1.3520-1.3680 with targets at 1.3390-1.3350-1.3310 and 1.3520-1.3200 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3530-1.3490
S2     1.3455
S3     1.3350-1.3310

Intraday Resistance Levels
R1     1.3605--1.3690
R2     1.3740
R3     1.3800-1.3830

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

42.901

Buy
20-DMA   1.3645 Buy
50-DMA   1.3689 Buy
100-DMA   1.3737 Buy
200-DMA   1.3702 Buy
STOCH(5,3)   43.766 Sell
MACD(12,26,9)   -0.004 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY112.72/USD and made an intraday high of JPY113.28/USD and settled the day down 0.1120% at JPY112.83/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 112.50-110.50 with targets of 113.50-114.20-114.90 and 115.60-116.00-116.90 with stop below 106.00. Sell below 113.00-115.90 with risk above 115.90 targeting 113.50-113.00-112.50 and 111.70-110.50-109.60.

 
Intraday Support Levels
S1     112.35-111.70
S2     111.30
S3     110.80-110.50

INTRADAY RESISTANCE LEVELS
R1     113.00-113.50
R2     114.30
R3     114.90-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.00 Buy
20-DMA   110.86 Sell
50-DMA   110.37 Sell
100-DMA   109.89 Sell
200-DMA   109.00 Sell
STOCH(9,6)   73.683 Buy
MACD(12,26,9)   -0.0131 Sell

AAFX TRADING
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