AAFX TRADING

Daily Market Lookup

  • The dollar was down on Tuesday morning in Asia, just above a one-week low hit during the previous week, as concerns that the new omicron COVID-19 variant would derail the U.S. economic recovery and delay U.S. Federal Reserve interest rate hikes subsided. Chinese data released earlier in the day showed that the manufacturing purchasing managers index (PMI) was at 50.1, while the non-manufacturing PMI was at 52.3, in November. The World Health Organization warned of a "very high" risk of infection surges from omicron, with some countries already tightening border controls. However, U.S. President Joe Biden said that the U.S. would not reinstate lockdowns, which gave investor sentiment a small boost. Meanwhile, U.S. Federal Reserve Chairman Jerome Powell still expects inflation to recede over 2022 as supply and demand come into better balance. However, he added on Monday that the “recent rise in COVID-19 cases and the emergence of the omicron variant pose downside risks to employment and economic activity and increased uncertainty for inflation. Increased inflationary pressures could potentially speed up interest rate hikes, but Omicron's discovery initially saw investors push back bets for Fed monetary policy tightening because of the risk to growth. The dollar traded higher Monday, boosted by higher U.S. Treasury yields as traders considered Friday’s sharp moves on the discovery of the omicron coronavirus variant as overdone. The World Health Organization said on Sunday that it is not yet clear if the new omicron coronavirus variant is more transmissible compared to other variants or if it causes more severe disease. Health experts from South Africa, where the new variant was first detected, have indicated that the symptoms from the omicron variant have been mild so far, although they also pointed out that their population is relatively young, and that the number of 'breakthrough' infections of vaccinated people was significant. Vaccine makers have indicated that they will be able to reformulate their drugs in pretty short order, and this has prompted traders to unwind a lot of Friday’s sharp moves, which were all the sharper for taking place on a day when liquidity was thin due to the U.S. holiday weekend. Aside from the news surrounding the omicron variant, “the general environment in FX remains quite supportive for the dollar, as the FOMC minutes and a bunch of good data kept market speculation on faster tapering and earlier tightening alive,” said analysts at ING, in a note. “On top of this, the worsening contagion situation in Europe and risk of fresh containment measures are generating further divergence in policy expectations between the ECB and Fed.” Several officials from the European Central Bank, including President Christine Lagarde, have speaking duties on Monday, and investors will be looking for clues on the central bank’s thinking ahead of its meeting on Dec. 16. ECB board member Isabel Schnabel said the bank expects inflation to peak this month. Preliminary German inflation data for November are due in the course of the morning. ECB officials are due to receive new forecasts that are likely to show inflation climbing at a higher rate than expected earlier, but they will also have to weigh up the dangers posed by the pandemic following the return of lockdowns to some parts of Europe, as well as the discovery of the new variant.
  • Gold was up on Tuesday morning in Asia, with investors remaining cautious about the omicron COVID-19 variant’s impact on the global economic recovery. Omicron has already prompted some countries to close their borders and cast a shadow on the economic recovery. U.S. Federal Reserve Chairman Jerome Powell said on Monday that he still expects inflation to recede over 2022 as supply and demand come into better balance. However, he added that the “recent rise in COVID-19 cases and the emergence of the omicron variant pose downside risks to employment and economic activity and increased uncertainty for inflation.” Powell, alongside U.S. Treasury Secretary Janet Yellen, will testify at a Senate Banking Committee hearing later in the day and the House Financial Services Committee a day later. Across the Atlantic the European Central Bank attempted to assuage investor concerns over omicron on Monday, saying that the euro zone’s economy had learned to cope with successive waves of COVID-19. In Asia Pacific, data released earlier in the day showed that China’s manufacturing purchasing managers index (PMI) was at 50.1, while the non-manufacturing PMI was at 52.3, in November. In Japan, October’s employment data showed that the jobs/application ratio was at 1.15 and the unemployment rate was down to 2.7%. Industrial production also grew 1.1% month-on-month.
  • Oil was up Tuesday morning in Asia, continuing its recovery from last week’s fall. Investors continue to bet that major producers would pause adding crude supply due to the uncertainty over the new Omicron coronavirus variant. The World Health Organization said on Monday that Omicron posed a very high risk of infection surges, and has classified it as a “variant of concern.” Several countries such as the Netherlands, Denmark, and Australia reported omicron cases over the weekend and other countries have imposed travel curbs. With the fuel demand outlook unclear due to omicron, investors now expect the Organization of the Petroleum Exporting Countries and their allies (OPEC+) to pause plans to add 400,000 barrels per day (bpd) of supply in January. The cartel is due to meet to discuss supply on Dec. 2. OPEC+ was already reconsidering its plan after the U.S. and other major consumers announced a smaller-than-expected coordinated release from the Strategic Petroleum Reserve during the previous week. Elsewhere, world powers and Iran resumed talks on reviving a 2015 nuclear pact, with upbeat comments from diplomats giving the market a boost. Investors now await U.S. crude oil supply from the American Petroleum Institute, due later in the day.

 

 
Intraday RESISTANCE LEVELS
30th November 2021 R1 R2 R3
GOLD-XAU 1,800-1,808 1,818 1,834-1,840
Silver-XAG 23.10-24.10 24.80 25.10-25.50
Crude Oil 68.10-69.25 70.10 70.90-71.90
EURO/USD 1.1360 1.1385 1.1420-1.1485
GBP/USD 1.3390-1.3420 1.3490 1.3540-1.3605
USD/JPY ¬113.45-113.90 114.50 115.00-115.90

Intraday SUPPORTS LEVELS
30th November 2021 S1 S2 S3
GOLD-XAU 1,789-1,780 1,771 1,765-1,758
Silver-XAG 22.60-22.10 21.40 21.00-20.50
Crude Oil 67.30-66.90 66.00 65.40-64.90
EURO/USD 1.1310-1.1240 1.1170 1.1120-1.1050
GBP/USD 1.3300-1.3270 1.3200 1.3150-1.3100
USD/JPY 113.00-112.70 112.10 111.50-111.00

Intra-Day Strategy (30th 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$1799.30/oz and low of US$1777.27/oz. Gold down 0.293% at US$1784.39/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 1789-1765 with risk below 1765, targeting 1800-1808-1818 and 1834-1840-1852. Sell in between 1800-1852 keeping stop loss closing above 1852, targeting 1789-1780 and 1771-1765.

 
Intraday Support Levels
S1     1,789-1,780
S2     1,771
S3     1,765-1,758
Intraday Resistance Levels
R1     1,800-1,808
R2     1,818
R3     1,834-1,840

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 Friday made its intraday high of US$23.42/oz and low of US$22.74/oz settled down by 1.00% at US$23.88/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 22.60-20.90, targeting 23.20-24.05-24.55 and 25.05-25.50-25.90 with stop loss should be place on the breakage below 20.90. Sell in between 23.10-26.50 with stop loss above 26.50; targeting 22.60-22.10-21.40 and 21.00-20.50.

 
Intraday  Support Levels
S1     22.60-22.10
S2     21.40
S3     21.00-20.50

Intraday  Resistance Levels
R1     23.10-24.10
R2     24.80
R3     25.10-25.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.051 Buy
20-DMA   23.86 Sell
50-DMA   23.87 Sell
100-DMA   24.15 Sell
200-DMA   24.42 Sell
STOCH(5,3)   10.891 Buy
MACD(12,26,9)   -0.186 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$72.72/bbl, intraday low of US$68.68/bbl and settled up by 0.% to close at US$69.84/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 68.10-71.90 with stop loss at 71.90; targeting 67.30-66.90-66.00 and 65.40-64.90. Buy above 66.90-64.90 with risk daily closing below 64.90 and targeting 71.90-72.90-73.50 and 74.00-74.90.

 
Intraday Support Levels
S1     67.30-66.90
S2     66.00
S3     65.40-64.90

Intraday Resistance Levels
R1     68.10-69.25
R2     70.10
R3     70.90-71.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.850 Sell
20-DMA   77.31 Sell
50-DMA   77.28 Buy
100-DMA   74.66 Buy
200-DMA   69.21 Buy
STOCH(5,3)   29.873 Sell
MACD(12,26,9)   0.933 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1257/EUR, high of US$1.1317/EUR and settled the day down by 0.103% to close at US$1.1290/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 1.1350-1.1540 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     1.1310-1.1240
S2     1.1170
S3     1.1120-1.1050

Intraday  Resistance Levels
R1     1.1360
R2     1.1385
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   1.1767v 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$1.3286/GBP, high of US$1.3362/GBP and settled the day up by 0.148% to close at US$1.3313/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 1.3350-1.3200 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     1.3300-1.3270
S2     1.3200
S3     1.3150-1.3100

Intraday Resistance Levels
R1     1.3390-1.3420
R2     1.3490
R3     1.3540-1.3605

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 JPY112.94/USD and made an intraday high of JPY113.88/USD and settled the day down % at JPY113.18/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 113.20-110.50 with targets of 113.45-113.90-114.20 and 114.90-115.60-116.00 with stop below 106.00. Sell below 113.45-115.90 with risk above 115.90 targeting 113.20-112.70-112.10 and 111.50-110.50.

 
Intraday Support Levels
S1     113.00-112.70
S2     112.10
S3     111.50-111.00

INTRADAY RESISTANCE LEVELS
R1     ¬113.45-113.90
R2     114.50
R3     115.00-115.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.340 Buy
20-DMA   114.25 Sell
50-DMA   113.18 Sell
100-DMA   111.96 Sell
200-DMA   110.46 Sell
STOCH(9,6)   94.683 Buy
MACD(12,26,9)   0.1202 Sell

AAFX TRADING
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