AAFX TRADING

Daily Market Lookup

  • The dollar edged lower Tuesday, handing back some of the previous session’s gains but remained near a new four-and-a-half-year high against the yen after Jerome Powell was nominated for a second term as chairman of the Federal Reserve. The dollar received a boost from the decision of President Joe Biden to nominate Powell to head the Fed for a second term, instead of Lael Brainard, who was seen as the more dovish of the two and was instead promoted to Fed vice-chair. Powell’s nomination now goes to the Senate for confirmation, but this move has reinforced market expectations of interest rate hikes in 2022 when the Fed is expected to have finished its asset tapering program. More evidence of the slowdown in business activity in the Eurozone is likely from the flash November PMI data for the region later in the session. Despite all that, there was a notable shift in ECB rhetoric early Tuesday, with Isabel Schnabel becoming the first board member to warn that inflation risks are now skewed to the upside. So far, Beijing’s moves to rein in the appreciation have been measured, setting weaker-than-expected reference rates for the yuan for four straight days while urging banks to limit speculation, particularly of a bullish kind. However, this has had limited impact, raising speculation China’s central bank could cut interest rates in the near future.
  • The dollar hit a new four-and-a-half-year top against the yen on Tuesday after Federal Reserve Chair Jerome Powell was renominated for a second term, reinforcing bets that U.S. interest rates would rise next year and diverge from Japan's. The Japanese currency is sensitive to moves in U.S. Treasury notes, and two-year U.S. Treasury yields rose 8.5 basis points on Monday to their highest since early March 2020. They last yielded 0.5924%, little changed in Asian hours. U.S. President Joe Biden chose Powell over the other leading candidate Lael Brainard, whom markets consider to be the more dovish of the two, though Brainard will be Fed vice chair. The news reinforced market expectations of rate rises next year when the central bank finishes tapering its emergency bond buying programme. Currency markets have been mostly driven by market perceptions of the different paces at which global central banks reduce pandemic era stimulus and raise rates. The common currency has been hurt by the dovish tone from the European Central Bank and more recently a resurgence in COVID-19 cases in Europe, which forced Austria back into a full lockdown on Monday and caused Germany to consider tighter restrictions. Traders will be looking for signs of the impact of the restrictions on European growth later Tuesday when French, German and Eurozone PMI data are released, with British U.S. PMI data also due. Sterling was soft versus the rampant dollar with one pound at $1.340.
  • The dollar was up on Tuesday morning in Asia, remaining near a four-and-a-half-year high against the yen. Incumbent U.S. Federal Reserve Chair Jerome Powell’s appointment to a second term increased bets that the U.S. will hike interest rates quicker than expected. Investors also continued to digest U.S. President Joe Biden’s choice of Powell to head the Fed over Lael Brainard. Considered the more dovish of the pair, Brainard was promoted to Fed vice-chair. Powell’s renomination reinforced market expectations of interest rate hikes in 2022 when the Fed finishes its asset tapering program. Market bets on the pace of central banks’ asset tapering and interest rate hikes have driven currency markets recently. The U.S. central bank may need to speed up the removal of monetary stimulus in response to strong employment gains and surging inflation, which could lead to a quicker-than-expected interest rate hike, said Fed Bank of Atlanta President Raphael Bostic. The number of COVID-19 cases in the continent is rising, with Austria under a full lockdown since Monday and Germany considering tighter restrictive measures. The euro was at $1.124, around a 16-month low. It has fallen 2.8% so far in November, also hurt by the European Central Bank’s recent dovish tone.
  • Oil prices fell on Tuesday, reversing gains the previous session on talk the United States, Japan and India will release crude reserves to tame prices despite the threat of faltering demand as COVID-19 cases flare up in Europe. The United States is expected to announce a loan of crude oil from its emergency stockpile on Tuesday as part of a plan it hashed out with major Asian energy consumers to lower energy prices, a Biden administration source familiar with the situation said. Brent and WTI had both risen 1% on Monday on reports the Organization of the Petroleum Exporting Countries, Russia and their allies, an alliance known as OPEC+, could adjust their plan to raise oil output if large consuming countries release crude from their reserves or if the pandemic dampens demand. With talk of a coordinated crude release having succeeded in driving prices back below $80 a barrel and an actual release only expected to have a temporary impact, analysts are turning their attention to the potential hit to demand from a fourth wave of COVID-19 cases in Europe. He said only Europe could pressure prices and bearish bets should be off if the Northern Hemisphere experiences a cold winter. She said demand in November for road and jet fuel in Europe was expected to fall to 7.8 million barrels per day (bpd) from 8.1 million bpd in October, although part of that is a normal decline for this time of year.

 

 
Intraday RESISTANCE LEVELS
23rd November 2021 R1 R2 R3
GOLD-XAU 1,808-1,818 1,834 1,840-1,852
Silver-XAG 25.10-25.50 25.80 26.20-26.50
Crude Oil 76.00-76.90 77.60 78.05-79.10
EURO/USD 1.1310-1.1360 1.1420-1.1485 1.1420-1.1485
GBP/USD 1.3420-1.3490 1.3540 1.3605-1.3685
USD/JPY 115.00 ¬115.50 115.90-116.50

Intraday SUPPORTS LEVELS
23rd November 2021 S1 S2 S3
GOLD-XAU 1,800-1,789 1,780 1,771-1,765
Silver-XAG 23.75-23.20 22.60 22.20-21.50
Crude Oil 75.50-74.65 73.90 73.50-73.00
EURO/USD 1.1250-1.1200 1.1170 1.1120-1.050
GBP/USD 1.3390-1.3350 1.3270-1.3200 1.3270-1.3200
USD/JPY 113. 45 113. 45 112.80-112.20

Intra-Day Strategy (23rd 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 Monday made its intraday high of US$1849.02/oz and low of US$1802.10/oz. Gold down 2.277% at US$1804.23/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 1800-1765 with risk below 1765, targeting 1808-1818-1834 and 1840-1852-1863. Sell in between 1808-1852 keeping stop loss closing above 1852, targeting 1808-1818-1834 and 1840-1852.

 
Intraday Support Levels
S1     1,800-1,789
S2     1,780
S3     1,771-1,765
Intraday Resistance Levels
R1     1,808-1,818
R2     1,834
R3     1,840-1,852

Technical Indicators

Name   Value Action
14DRSI  

58.7997

Buy
20-DMA   1830.22 Buy
50-DMA  

1807.29

Buy
100-DMA   1800.78 Buy
200-DMA   1800.07 Sell
STOCH(5,3)   21.940 Sell
MACD(12,26,9)   19.816 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$24.87/oz and low of US$24.09/oz settled down by 1.828% at US$24.16/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 23.75-21.90, targeting 24.05-24.55-25.05 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     23.75-23.20
S2     22.60
S3     22.20-21.50

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 Monday made an intra‐day high of US$76.99/bbl, intraday low of US$74.97/bbl and settled down by 0.975% to close at US$76.30/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 76.00-79.10 with stop loss at 79.90; targeting 75.50-74.65-73.90 and 73.50-73.00. Buy above 75.50-73.00 with risk daily closing below 73.00 and targeting 76.00-76.90-77.60 and 78.05-79.00-79.90.

 
Intraday Support Levels
S1     75.50-74.65
S2     73.90
S3     73.50-73.00

Intraday Resistance Levels
R1     76.00-76.90
R2     77.60
R3     78.05-79.10

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 Monday made an intraday low of US$1.1229/EUR, high of US$1.1290/EUR and settled the day down by 0.485% to close at US$1.1235/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 1.1310-1.1170 with risk below 1.1170, targeting 1.1360-1.1385-1.1420 and 1.1485-1.1510-1.1590. Sell below 1.1355-1.1540 targeting 1.1540 and 1.1310-1.1250-1.1200 and 1.1170-1.1120 with stop-loss at daily closing above 1.1540.

 
Intraday Support Levels
S1     1.1250-1.1200
S2     1.1170
S3     1.1120-1.050

Intraday  Resistance Levels
R1     1.1310-1.1360
R2     1.1420-1.1485
R3     1.1420-1.1485

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.804 Buy
20-DMA   1.1477 Sell
50-DMA   1.1580 Sell
100-DMA   1.1683 Sell
200-DMA   1.1767 Sell
STOCH(5,3)   39.685 Buy
MACD(12,26,9)   -0.007 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3406/GBP, high of US$1.3449/GBP and settled the day up by 0.0630% to close at US$1.3395/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 1.3390-1.3200 with targets 1.3420-1.3490-1.3540 and 1.3605-1.36851.3750 with stop loss closing below 1.3200. Sell in between 1.3420-1.3685 with targets at 1.3390-1.3350 and 1.3310-1.3265-1.3200 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3390-1.3350
S2     1.3270-1.3200
S3     1.3270-1.3200

Intraday Resistance Levels
R1     1.3420-1.3490
R2     1.3540
R3     1.3605-1.3685

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 Monday made intra‐day low of JPY113.91/USD and made an intraday high of JPY114.95/USD and settled the day up 0.840% at JPY114.87/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 114.50-110.50 with targets of 114.20-114.90 and 115.60-116.00-116.90 with stop below 106.00. Sell below 114.90-115.90 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
S2     113. 45
S3     112.80-112.20

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.207 Buy
20-DMA   112.46 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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