AAFX TRADING

Daily Market Lookup

  • The dollar eased back from near an almost 16-month high versus major peers on Monday, as traders awaited fresh clues on the U.S. economy after bringing forward bets last week for a Federal Reserve interest rate hike on the back of red-hot inflation. Investors will also be watching any comments coming out of a virtual summit between President Biden and Chinese leader Xi Jinping, set for Tuesday morning Beijing time and Monday evening in Washington, with relations between the world's two largest economies strained over a range of issues. Otherwise, the main event on the U.S. economic calendar this week will be Tuesday's retail sales data, particularly after a survey on Friday showed consumer confidence unexpectedly plunged to a decade low in early November as high inflation hit sentiment. The dollar had been on a tear since Wednesday, when data showed a broad-based rise in U.S. consumer prices last month at the fastest annual pace since 1990, casting doubts on the Fed's stance that price pressure will be transitory. Money markets were pricing a first rate increase by July and a high likelihood of another by November next year as of the end of last week. The dollar index "has shifted into higher gears" following Wednesday's "blowout" inflation reading, with Fed stimulus tapering, President Joe Biden's infrastructure spending and a tightening labor market also providing a dollar-supportive backdrop, Westpac strategists wrote in a research note. Gains in the heavily euro-weighted dollar index have also been helped by a droop in the single currency, with the European Central Bank appearing unlikely to change its extremely dovish policy settings in the near term against the backdrop of a slowing economy. Later on Monday, ECB president Christine Lagarde will speak before the Committee on Economic and Monetary Affairs of the European Parliament. Data on Monday showed Japan's economy shrunk much faster than economists predicted in the third quarter as supply disruptions hit exports and business spending plans.
  • The dollar was down on Monday morning in Asia, remaining below an almost 16-month high. Investors now await the next clues on the status of the U.S. economic recovery from COVID-19 after the brought forward bets for a U.S. Federal Reserve interest rate hike during the previous week as inflation continues to skyrocket. Chinese data released earlier in the day showed that fixed-asset investment grew 6.1% year-on-year, industrial production grew 3.5% year-on-year and retail sales grew 4.9% year-on-year in October. The unemployment rate remained unchanged at 4.9%. Chinese President Xi Jinping will also reportedly hold a virtual summit with U.S. counterpart Joe Biden. U.S. data released during the previous week showed that the consumer price index grew at its fastest annual pace since 1990, giving the dollar boost. Investors are now doubting the Fed’s insistence that inflationary pressures will be temporary, pricing the first rate increase by July 2022 and a high likelihood of another by November 2022 as of the end of last week. Investors now await U.S. retail sales data, which will be released on Tuesday. "It will be important to watch what still cashed-up U.S. consumers do rather than what they say," considering readings of sentiment were at odds with actual spending during the summer, National Australia Bank (OTC:NABZY) head of FX strategy Ray Attrill said in a note. The dollar index, which is heavily euro-weighted, has also been boosted by the euro's drop as the European Central Bank (ECB) will not likely change its current dovish tone. The euro was little changed at $1.14455, remaining near Friday's 16-month low of $1.1433. ECB president Christine Lagarde will also speak before the Committee on Economic and Monetary Affairs of the European Parliament later in the day.
  • Crude oil prices fell on Monday on expectations of increasing supply, while higher energy costs and rising COVID-19 cases are also seen weighing on demand. Oil markets have dropped for the last three weeks, hit by a strengthening dollar and speculation that President Joe Biden's administration might release oil from the U.S. Strategic Petroleum Reserve to cool prices. U.S. energy firms this week added oil and natural gas rigs for a third week in a row with crude prices hovering near a seven-year high, prompting some drillers to return to the wellpad. The oil and gas rig count, an early indicator of future output, rose by six to 556 in the week to Nov. 12, its highest level since April 2020, energy services firm Baker Hughes Co said on Friday. Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) last week cut its world oil demand forecast for the fourth quarter by 330,000 barrels per day (bpd) from last month's forecast, as high energy prices hampered economic recovery from the COVID-19 pandemic. Europe has become the epicentre of the COVID-19 pandemic again, prompting some governments to consider re-imposing unpopular lockdowns, while China is battling the spread of its biggest outbreak caused by the Delta variant. Russia's Rosneft, the world's second-biggest oil company by output after Saudi Aramco (SE:2222), warned on Friday of a potential "super cycle" in global energy markets, raising the prospect of even higher prices as demand outstrips supply. However, Brian Deese, director of the White House National Economic Council, told CNN, “The president has made clear that all options are on the table,” adding “we’re monitoring the situation very carefully.” Investors have been focused on whether the U.S. would release SPR reserves after crude climbed to a seven-year high in October. Biden’s request to the Organization of Petroleum Exporting Countries and allies, or OPEC+, to raise crude production more quickly has also fallen on deaf ears. However, some investors think that the U.S. also has other options, albeit limited, besides tapping the SPR.

 

 
Intraday RESISTANCE LEVELS
15th November 2021 R1 R2 R3
GOLD-XAU 1,863-1,868 1,874 1,880-1,890
Silver-XAG 25.10-25.50 25.80 26.20-26.50
Crude Oil 79.00-79.90 80.50 81.40-81.90
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
15th November 2021 S1 S2 S3
GOLD-XAU 1,852-1,840 1,834 1,829-1,818
Silver-XAG 24.55-23.75 23.20 22.60-22.20
Crude Oil 78.05-77.60 76.90 76.00-74.95
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 (15th 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 Friday made its intraday high of US$1868.58/oz and low of US$1845.14/oz. Gold up 0.1702% at US$1864.85/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 1852-1804 with risk below 1804, targeting 1863-1874 and 1880-1890. Sell in between 1863-1889 keeping stop loss closing above 1889, targeting 1818-1810-1804 and 1790-1782-1774.

 
Intraday Support Levels
S1     1,852-1,840
S2     1,834
S3     1,829-1,818
Intraday Resistance Levels
R1     1,863-1,868
R2     1,874
R3     1,880-1,890

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 Friday made its intraday high of US$25.37/oz and low of US$24.83/oz settled up by 0.436% at US$25.33/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 25.10-26.50 with stop loss above 26.50; targeting 24.55-23.75-23.20 and 22.60-22.00.

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

Intraday  Resistance Levels
R1     25.10-25.50
R2     25.80
R3     26.20-26.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.35 Buy
20-DMA   24.22 Sell
50-DMA   23.90 Sell
100-DMA   24.22 Sell
200-DMA   24.48 Sell
STOCH(5,3)   87.950 Buy
MACD(12,26,9)   -0.587 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$80.45/bbl, intraday low of US$78.74/bbl and settled down by 0.667% to close at US$79.61/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 79.00-83.10 with stop loss at 83.10; targeting 78.40-77.60-76.90 and 76.00-74.95. Buy above 78.05-74.95 with risk daily closing below 74.95 and targeting 79.00-79.90-80.50 and 81.40-81.90-83.10.

 
Intraday Support Levels
S1     78.05-77.60
S2     76.90
S3     76.00-74.95

Intraday Resistance Levels
R1     79.00-79.90
R2     80.50
R3     81.40-81.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.237 Sell
20-DMA   80.47 Sell
50-DMA   77.96 Buy
100-DMA   74.36 Buy
200-DMA   68.48 Buy
STOCH(5,3)   20.485 Sell
MACD(12,26,9)   0.468 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1432/EUR, high of US$1.1461/EUR and settled the day down by 0.0646% to close at US$1.1442/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 Friday made an intra‐day low of US$1.3352/GBP, high of US$1.3425/GBP and settled the day down by 1.113% to close at US$1.3407/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 Friday made intra‐day low of JPY113.75/USD and made an intraday high of JPY114.29/USD and settled the day down % at JPY113.90/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

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