AAFX TRADING

Daily Market Lookup

  • The dollar rose to 20-month highs against the euro and other currencies on Thursday, and the yen fell back towards multi-year lows, after the hottest U.S. inflation reading in a generation encouraged bets on interest rate hikes. U.S. consumer prices grew last month at their fastest annual pace since 1990, data showed, and traders think the Federal Reserve could respond by lifting interest rates faster than peers in Europe and Japan. The euro was pummelled, as the European Central Bank is seen lagging on policy tightening. It slipped further to $1.1459 on Thursday, its lowest since July 2020. Sterling was also marginally down on Thursday at a new 11-month low of $1.3388, with better-than-expected GDP data in Britain doing little to support the pound. The yen extended a sharp reversal of recent gains to 114.15 per dollar -- close to the Japanese currency's four-year low of 114.69 reached last month. The Australian and New Zealand dollars recorded one-month troughs. After the surge in Treasury yields, which rise when prices fall, the difference between five-year U.S. yields and yields at the same tenor in Japan and Germany is wider - in favour of Treasuries - than at any time since early 2020. Emerging-market currencies have also suffered from the dollar's broad rise, with MSCI's EM currencies index suffering its sharpest drop in two months. A jobs report in Australia showed an unexpected rise in unemployment.
  • The dollar was up on Thursday morning in Asia. The U.S. currency was at its highest levels in 2021 against the pound and the euro, while the yen took a sharp fall after U.S. inflation rose to its highest level in a generation and fanned bets on interest rate hikes. The euro slid 1% to $1.1476, its lowest level since July 2020, after the U.S. released inflation data on Wednesday. The data showed that the consumer price index (CPI) grew 6.2% year-on-year and 0.9% month-on-month in October. The core CPI rose 4.6% year-on-year and 0.6% month-on-month. U.S. Treasury yields also surged. These rates move, especially at the short end, suggest traders believe the U.S. Federal Reserve will step in to hike interest rates if prices keep running higher, National Australia Bank (OTC:NABZY) head of FX strategy, Ray Attrill told Reuters. In Asia Pacific, Australia also released employment data earlier in the day. The data showed that the employment change contracted by 46,300 and the full employment change contracted by 40,400 in October. The unemployment rate increased to 5.2%. To gauge the likelihood of further dollar gains, investors now look to the data’s impact on the Fed’s next moves. The dollar's advance follows Wednesday’s release of U.S. consumer prices data, which showed that prices grew at their fastest annual pace since 1990 in October and raised fresh doubts about whether the Fed can afford to sit on its hands until at least the end of next year, as its most recent guidance suggests. Price rises were both higher than expected and broad-based - and would have been even worse without a temporary drop in air fare prices due to Delta-variant Covid-19. The currency move was also supported by a surge in Treasury yields, with the difference between 5-Year U.S. yields and the equivalent yields in Japan and Germany has grown to the widest level since early 2020. Bonds had sold off in the U.S. on Wednesday after a weak auction of 30-year debt.
  • Oil was up Thursday morning in Asia. Meanwhile, rising inflation in the U.S. thanks to soaring energy costs, could prompt the release of more strategic crude stockpiles to drive down prices. Both Brent and WTI futures fell on Wednesday after Wednesday’s data showed that U.S. inflation increased at the fastest rate in 30 years. The consumer price index grew 6.2% year-on-year and 0.9% month-on-month, while the core CPI rose 4.6% year-on-year and 0.6% month-on-month in October. U.S. President Joe Biden has requested that the National Economic Council find ways to reduce energy costs and the Federal Trade Commission to push back on market manipulation in the energy sector to reverse inflation. These efforts could include releasing more supplies from the U.S. Strategic Petroleum Reserve. Inventories of gasoline and distillates, such as diesel, continued to fall, the U.S. Energy Information Administration (EIA) said on Wednesday. Wednesday’s crude oil supply data from the EIA showed a build of 1.001 million barrels in the week to Nov. 5. Forecasts prepared by Investing.com had predicted a 2.125-million-barrel build, while a 3.291-million-barrel build was reported during the previous week. Crude oil supply data from the American Petroleum Institute released the day before, showed a draw of 2.485 million barrels. Consumer inflation data on Wednesday showed U.S. prices were rising at a 6.2% year-over-year rate. The dollar gained on expectations that actions by the White House and U.S. Federal Reserve to curb the rising prices may lead to higher interest rates and tighter monetary policy. Oil typically trades inversely to the dollar. U.S. President Joe Biden said he asked the National Economic Council to work to reduce energy costs and the Federal Trade Commission to push back on market manipulation in the energy sector to reverse inflation. Some of the efforts to cut energy costs might include releasing more crude from the U.S. Strategic Petroleum Reserve (SPR). U.S. crude stocks rose last week on the SPR injection while inventories of gasoline and distillates like diesel declined further, the Energy Information Administration said on Wednesday. Crude inventories rose by 1 million barrels in the week to Nov. 5, compared with analysts' expectations for an increase of 2.1 million barrels. The SPR release was 3.1 million barrels, the largest since July 2017.

 

 
Intraday RESISTANCE LEVELS
11th November 2021 R1 R2 R3
GOLD-XAU 1,852-1,863 1,868 1,874-1,880
Silver-XAG 24.90-25.50 25.80 26.20-26.50
Crude Oil 80.50-81.40 81.90 82.50-83.10
EURO/USD 1.1485-1.1510 1.1540 1.1590-1.1655
GBP/USD 1.3390-1.3455 1.3490 1.3530-1.3605
USD/JPY 114.30-114.70 115.00 115.50-115.90

Intraday SUPPORTS LEVELS
11th November 2021 S1 S2 S3
GOLD-XAU 1,840-1,834 1,829 1,818-1,810
Silver-XAG 24.55-23.75 23.20 22.60-22.20
Crude Oil 79.90-79.00 78.05 77.60-76.90
EURO/USD 1.1420-1.1385 1.1355 1.1310-1.1250
GBP/USD 1.3350-1.3310 1.3265 1.3190-1.3150
USD/JPY 113.45-112.90 112.35 111.70-111.40

Intra-Day Strategy (11th 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 Wednesday made its intraday high of US$1868.44/oz and low of US$1822.22/oz. Gold up 0.00165% at US$1849.26/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 1840-1804 with risk below 1804, targeting 1852-1863 and 1874-1889. Sell in between 1855-1889 keeping stop loss closing above 1889, targeting 1818-1810-1804 and 1790-1782-1774.

 
Intraday Support Levels
S1     1,840-1,834
S2     1,829
S3     1,818-1,810
Intraday Resistance Levels
R1     1,852-1,863
R2     1,868
R3     1,874-1,880

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 Wednesday made its intraday high of US$25.11/oz and low of US$24.01/oz settled up by 1.275% at US$24.61/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 24.55-21.90, 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 24.90-25.90 with stop loss above 25.90; targeting 23.90-23.20-22.60 and 22.00-21.40.

 
Intraday  Support Levels
S1     24.55-23.75
S2     23.20
S3     22.60-22.20

Intraday  Resistance Levels
R1     24.90-25.50
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 Wednesday made an intra‐day high of US$83.56/bbl, intraday low of US$79.74/bbl and settled down by 3.61% to close at US$80.16/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 80.50-83.10 with stop loss at 83.10; targeting 79.90-79.00-78.40 and 77.60-76.90. Buy above 80.50-83.10 with risk daily closing below 79.40 and targeting 83.10-83.60-84.50 and 84.95-85.50.

 
Intraday Support Levels
S1     79.90-79.00
S2     78.05
S3     77.60-76.90

Intraday Resistance Levels
R1     80.50-81.40
R2     81.90
R3     82.50-83.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.780 Sell
20-DMA   80.76 Buy
50-DMA   77.86 Buy
100-DMA   74.16 Buy
200-DMA   68.27 Buy
STOCH(5,3)   61.485 Sell
MACD(12,26,9)   0.868 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1475/EUR, high of US$1.1549/EUR and settled the day up by 0.984% to close at US$1.1478/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 1.1420-1.1250 with risk below 1.1250, targeting 1.1485-1.1540-1.1590 and 1.1640-1.1750-1.1800. Sell below 1.1485-1.1655 targeting 1.1420-1.1385-1.1355 and 1.1310-1.1250 with stop-loss at daily closing above 1.1910.

 
Intraday Support Levels
S1     1.1420-1.1385
S2     1.1355
S3     1.1310-1.1250

Intraday  Resistance Levels
R1     1.1485-1.1510
R2     1.1540
R3     1.1590-1.1655

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.362 Buy
20-DMA   1.1617 Buy
50-DMA   1.1672 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 Wednesday made an intra‐day low of US$1.3400/GBP, high of US$1.3564/GBP and settled the day down by 1.113% to close at US$1.3404/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 1.3350-1.3150 with targets 1.3390-1.3455-1.3510 and 1.3560-1.3680 with stop loss closing below 1.3100. Sell in between 1.3390-1.3680 with targets at 1.3350-1.3310 and 1.3265-1.3200-1.3150 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3350-1.3310
S2     1.3265
S3     1.3190-1.3150

Intraday Resistance Levels
R1     1.3390-1.3455
R2     1.3490
R3     1.3530-1.3605

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

32.233

Buy
20-DMA   1.3598 Buy
50-DMA   1.3665 Buy
100-DMA   1.3723 Buy
200-DMA   1.3696 Buy
STOCH(5,3)   18.766 Sell
MACD(12,26,9)   -0.004 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY112.76/USD and made an intraday high of JPY114.00/USD and settled the day up 0.941% at JPY113.89/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 114.30-115.90 with risk above 115.90 targeting 113.50-113.00-112.50 and 111.70-110.50-109.60.

 
Intraday Support Levels
S1     113.45-112.90
S2     112.35
S3     111.70-111.40

INTRADAY RESISTANCE LEVELS
R1     114.30-114.70
R2     115.00
R3     115.50-115.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.207 Buy
20-DMA   113.47 Sell
50-DMA   112.46 Sell
100-DMA   111.37 Sell
200-DMA   110.02 Sell
STOCH(9,6)   0.683 Buy
MACD(12,26,9)   -0.0131 Sell

AAFX TRADING
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