AAFX TRADING

Daily Market Lookup

  • The dollar edged lower Thursday, consolidating just below its 16-month high, while the Turkish lira slumps ahead of the country’s latest central bank meeting. The dollar has benefited in recent weeks from the market’s assessment that the Federal Reserve will be quicker to move against the rising inflation levels than many of its advanced economy contemporaries, a perception reinforced in the last month by strong labor market and retail sales data.By contrast, European Central Bank President Christine Lagarde has made it clear this week that early interest rate hikes are not on her agenda, a stance not exactly challenged by figures showing European car sales down 30% on the year in October, and the Bank of Japan is expected to keep adding stimulus to its beleaguered economy, accommodating a major fiscal stimulus package due to be unveiled by Prime Minister Kishida. The possible exception, among G7 central banks, is the Bank of England after a spike in Britain's October inflation piled pressure on it to hike rates at its meeting next month. The main economic data release Thursday will be the weekly initial jobless claims number, which is expected to show 260,000 claimants last week, a drop from 267,000 the previous week, and a fresh post-pandemic low. All but two of 24 economists surveyed by Bloomberg expect Governor Sahap Kavcioglu to cut the benchmark for a third successive meeting, after reducing its benchmark rate by 300 basis points over the last two gatherings. The dollar hovered below a 16-month peak in Asian trade on Thursday, losing ground on the New Zealand dollar, after having fallen against the pound and yen overnight as traders assessed whether the U.S. currency's recent surge was starting to stall. Markets' assessment of global central banks' differing responses to rising inflation have largely driven currencies in recent week Strong U.S. retail sales data earlier this week added fuel to the dollar's recent rally, which started last week after a strong U.S. inflation print bolstered market bets that the Federal Reserve will have to raise rates around the middle of next year.
  • Gold was down on Thursday morning in Asia, but a weakening dollar and U.S. bond yields retreating from a three-week high capped the yellow metal’s losses. Investors remained concerned about central banks hiking interest rates faster than expected. The U.S. Federal Reserve will only complete asset tapering in mid-2022, Chicago Fed President Charles Evans said on Wednesday. However, the central bank will continue to monitor whether record-high levels of inflation will come down as he expects, Evans added. Across the Atlantic, a jump in U.K. inflation in October raised expectations that the Bank of England will hike interest rates in December. The consumer price index grew a higher-than-expected 1.1% month-on-month and 4.2% year-on-year. Elsewhere in Europe, the European Central Bank must be ready to rein in inflation in the eurozone if it proves more durable than forecast, according to board member Isabel Schnabel. The U.S. currency pressed pause in a recent rally, prompting questions as to whether the rally is slowing down. U.K. inflation jumped in October, with the consumer price index growing 1.1% month-on-month and 4.2% year-on-year. The higher-than-expected levels is putting pressure on the Bank of England to hike interest rates in December. Better-than-expected U.S. retail sales data earlier in the week gave the dollar’s recent rally a boost. U.S. inflation, which hit a record 30-year high in October, also raised bets that the U.S. Federal Reserve will hike rates around the middle of 2022. Other investors viewed the dollar’s dip as an opportunity to buy. "Dips have been hard to come by lately, but anything into the low-95s looks like a buying opportunity," Westpac analysts said in a note. Meanwhile, commodity currencies fell thanks to oil prices that fell to six-week lows. The Canadian dollar was at 1.2608 against its U.S. counterpart, near a six-week low hit on Wednesday. The Bank of Canada is also expected to begin hiking interest rates in early 2022.
  • Oil prices slid to near six-week lows on Thursday as China said it was moving to release reserves following a Reuters report that the United States was asking big crude consumers to consider a coordinated release of stocks to lower prices. The bid by the U.S. administration to shock markets, asking China to join coordinated action for the first time, comes as inflationary pressures, partly driven by surging energy prices, start to produce a political backlash, as the world fitfully recovers from the worst health crisis in a century. Prices hit seven-year highs in October as the market focused on the swift rebound in demand that has come with lockdowns being lifted against a slow increase in supply from the Organization of the Petroleum Exporting Countries (OPEC) and its allies, called OPEC+. U.S. producers have also been reluctant to overspend on drilling after they were punished by investors for gorging on debt to pay for new exploration. The International Energy Agency and OPEC have said in recent weeks that more supply will be available in the next several months. OPEC+ is maintaining an agreement to boost output by 400,000 bpd every month so as not to flood the market with supply. The United States and allies have coordinated strategic petroleum reserve releases before, for example in 2011 during a war in OPEC member Libya. But the current proposal represents an unprecedented challenge to OPEC, the cartel that has influenced oil prices for more than five decades, because it involves China, the world's biggest importer of crude. China's state reserve bureau said it was working on a release of crude oil reserves although it declined to comment on the U.S. request. A Japanese industry ministry official said the United States has requested Tokyo's cooperation in dealing with higher oil prices, but he could not confirm whether the request included coordinated releases of stockpiles. By law, Japan cannot use reserve releases to lower prices, the official said. A South Korean official confirmed the United States had asked Seoul to release some oil reserves. In its weekly stockpile report, the United States Department of Energy said late on Wednesday that crude inventories fell unexpectedly last week as refineries, enjoying profitable processing rates, ramped up output before the winter heating season.

 

 
Intraday RESISTANCE LEVELS
18th November 2021 R1 R2 R3
GOLD-XAU 1,868 1,874 1,880-1,890
Silver-XAG 25.10-25.50 25.80 26.20-26.50
Crude Oil 76.90-77.60 78.05 79.00-79.90
EURO/USD 1.1355-1.1385 1.1420 1.1485-1.1510
GBP/USD 1.3540-1.3605 1.3685 1.3750-1.3790
USD/JPY 115.00-¬115.50 115.90 116.50-117.00

Intraday SUPPORTS LEVELS
18th November 2021 S1 S2 S3
GOLD-XAU 1,834 1,834 1,818-1,804
Silver-XAG 24.55-23.75 23.20 22.60-22.20
Crude Oil 76.00-74.90 74.60 73.90-73.00
EURO/USD 1.1290-1.1250 1.1200 1.1170-1.1120
GBP/USD 1.3490-1.3460 1.3390 1.3350-1.3310
USD/JPY 114.70-114.30 113.90 113.45-112.80

Intra-Day Strategy (18th 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$1867.94/oz and low of US$1849.47/oz. Gold down 0.918% at US$1867.20/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 1852-1819 with risk below 1819, targeting 1863-1874-1880 and 1890-1904. Sell in between 1868-1889 keeping stop loss closing above 1889, targeting 1852-1840-1834 and 1818-1810-1804.

 
Intraday Support Levels
S1     1,834
S2     1,834
S3     1,818-1,804
Intraday Resistance Levels
R1     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 Tuesday made its intraday high of US$25.39/oz and low of US$24.75/oz settled up by 0.926% at US$24.82/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 Wednesday made an intra‐day high of US$79.62/bbl, intraday low of US$76.86/bbl and settled down by 0.270% to close at US$77.36/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 76.90-79.90 with stop loss at 79.90; targeting 76.00-74.90-74.60 and 73.90-73.00. Buy above 76.00-73.00 with risk daily closing below 73.00 and targeting 76.90-77.60-78.05 and 79.00-79.90-80.50.

 
Intraday Support Levels
S1     76.00-74.90
S2     74.60
S3     73.90-73.00

Intraday Resistance Levels
R1     76.90-77.60
R2     78.05
R3     79.00-79.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.374 Sell
20-DMA   80.54 Sell
50-DMA   78.09 Buy
100-DMA   74.50 Buy
200-DMA   68.61 Buy
STOCH(5,3)   29.485 Sell
MACD(12,26,9)   0.933 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1262/EUR, high of US$1.1331/EUR and settled the day down by 0.0079% to close at US$1.1318/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 1.1290-1.1170 with risk below 1.1170, targeting 1.1355-1.1385-1.1420 and 1.1485-1.1510-1.1590. Sell below 1.1355-1.1540 targeting 1.1540 and 1.1290-1.1250-1.1200 and 1.1170-1.1120 with stop-loss at daily closing above 1.1540.

 
Intraday Support Levels
S1     1.1290-1.1250
S2     1.1200
S3     1.1170-1.1120

Intraday  Resistance Levels
R1     1.1355-1.1385
R2     1.1420
R3     1.1485-1.1510

TECHNICAL INDICATORS
Name   Value Action
14DRSI   25.697 Buy
20-DMA   1.1502 Sell
50-DMA   1.1597 Sell
100-DMA   1.1696 Sell
200-DMA   1.1771 Sell
STOCH(5,3)   8.6850 Buy
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3395/GBP, high of US$1.3495/GBP and settled the day up by 0.388% to close at US$1.3479/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 1.3490-1.3310 with targets 1.3560-1.3605-1.3685 and 1.3750-1.3790 with stop loss closing below 1.3300. Sell in between 1.3540-1.3790 with targets at 1.3490-1.3390-1.3350 and 1.3310-1.3265-1.3200 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3490-1.3460
S2     1.3390
S3     1.3350-1.3310

Intraday Resistance Levels
R1     1.3540-1.3605
R2     1.3685
R3     1.3750-1.3790

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

44.480

Buy
20-DMA   1.3539 Buy
50-DMA   1.3625 Buy
100-DMA   1.3696 Buy
200-DMA   1.3684 Buy
STOCH(5,3)   68.766 Buy
MACD(12,26,9)   -0.006 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY113.92/USD and made an intraday high of JPY114.94/USD and settled the day up 0.611% at JPY113.93/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 113.90-110.50 with targets of 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     114.70-114.30
S2     113.90
S3     113.45-112.80

INTRADAY RESISTANCE LEVELS
R1     115.00-¬115.50
R2     115.90
R3     116.50-117.00

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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