AAFX TRADING

Daily Market Lookup

  • The dollar was down on Wednesday morning in Asia. The safe-haven yen held steady, while the risk-sensitive Australian dollar remained near a one-year low after U.S. Federal Reserve Chairman Jerome Powell signaled quicker asset tapering even as risks from the omicron COVID-19 variant remain. As research into current vaccines’ efficacy against the latest variant of COVID-19 continues, some investors are worried that hasty monetary tightening could impact the global economic recovery. Powell testified before the Senate Banking Committee hearing alongside U.S. Treasury Secretary Janet Yellen on Tuesday. In his testimony, he said that the Fed will discuss whether to wrap up asset tapering a few months earlier than scheduled when it meets later in the month. Although Powell finally veered away from describing high inflation as "transitory”, he was confident that omicron’s impact would be less severe than when the COVID-19 pandemic erupted in 2020. Investors responded to Powell’s comments by winding up interest rate hike expectations. Powell and Yellen will testify before the House Financial Services Committee later in the day. The dollar edged lower Wednesday, consolidating after strong gains during the previous session after Fed Chair Jerome Powell indicated the U.S. central bank is likely to speed up the tapering of its asset purchases. Driving the earlier dollar gains were comments from the head of the Federal Reserve, Jerome Powell, to the Senate Banking Committee on Tuesday. At its November meeting, the Fed said it would reduce bond purchases by $15 billion a month. A move to speed this up would likely bring forward the time the central bank feels confident in raising its benchmark interest rates. The dollar had been hit earlier in the week as traders preferred safe havens such as the Japanese yen and the Swiss franc on a burst of risk aversion surrounding the emergence of the omicron variant of the Covid-19 virus. Powell's testimony continues later on Wednesday, while the release of the U.S. private payrolls will also be in the spotlight ahead of Friday’s official monthly jobs report. Elsewhere, USD/CNY rose 0.1% to 6.3661 after the pair earlier fell to a six-month low of 6.3596, with the yuan resilient after the release of better-than-expected official manufacturing PMI data from November. The Korean won also hit a two-week high after stronger-than-expected trade data, the two data releases showing that global manufacturing remained in rude health last month.
  • Gold was up on Wednesday morning in Asia, but remained near a one-month low. Investors continued to digest signs from U.S. Federal Reserve Chairman Jerome Powell that the central bank would discuss wrapping up asset tapering quicker than planned. Powell said the Fed will discuss whether to end asset tapering a few months earlier than scheduled in its meeting later in the month. He also veered away from describing high inflation as “transitory”. Powell's comments also gave the dollar, which normally moves inversely to gold, a boost. The dollar inched down on Wednesday. Fed officials are unhappy with inflation above the central bank's 2% target and bringing actual inflation down will be important to keeping expectations anchored near the Fed's goal, according to Fed Vice Chairman Richard Clarida. Across the Atlantic, Bank of England Monetary Policy Committee member Catherine Mann said on Tuesday that the new omicron COVID-19 variant could hurt consumer confidence, in turn weakening economic recovery. The World Health Organization warned against imposing blanket travel bans, which have already been implemented by several countries. Research into the efficacy of current vaccines against the new variant also continues. U.S. data, including the Institute of Supply Management manufacturing PMI and the Fed Beige Book, will be released later in the day. The U.S. job report, including non-farm payrolls, will follow on Friday. In Asia Pacific, China’s Caixin manufacturing purchasing managers index (PMI) for November, released earlier in the day, was at 49.9.
  • Oil prices rose more than 3% on Wednesday, recouping a big chunk of the previous session's steep losses, as major producers prepared to discuss how to respond to the threat of a hit to fuel demand from the Omicron variant of the coronavirus. The Organization of the Petroleum Exporting Countries (OPEC) will meet on Wednesday after 1300 GMT and ahead of a meeting on Thursday of OPEC+, which groups OPEC with allies including Russia. Some analysts expect OPEC+ to pause plans to add 400,000 barrels per day of supply in January in light of the potential hit to demand from travel curbs to rein in the spread of the Omicron variant. Several OPEC+ ministers, though, have said there was no need to change course. But even if OPEC+ agrees to go ahead with its planned supply increase in January, producers may struggle to add that much. A Reuters survey found OPEC pumped 27.74 million bpd in November, up 220,000 bpd from the previous month, but that was below the 254,000 bpd increase allowed for OPEC members under the OPEC+ agreement. In a sign of bearish demand, data from the American Petroleum Institute industry group showed U.S. crude stocks fell by 747,000 barrels in the week ended Nov. 26, according to market sources, which was a smaller decline than expected.

 

 
Intraday RESISTANCE LEVELS
1st December 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
1st December 2021 S1 S2 S3
GOLD-XAU 1,784-1,778 1,769 1,758-1,750
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 (1st December 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 Tuesday made its intraday high of US$1808.65/oz and low of US$1769.80/oz. Gold down 0.573% at US$1774.26/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 1786-1765 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     1,784-1,778
S2     1,769
S3     1,758-1,750
Intraday Resistance Levels
R1     1,800-1,808
R2     1,818
R3     1,834-1,840

Technical Indicators

Name   Value Action
14DRSI  

1830.22

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 Tuesday made its intraday high of US$23.30/oz and low of US$22.68/oz settled down by 0.292% at US$22.81/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 0.292% 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 Tuesday made an intraday low of US$1.1234/EUR, high of US$1.1382/EUR and settled the day up by 0.419% to close at US$1.1334/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   1.1767 Sell
STOCH(5,3)   39.685 Buy
MACD(12,26,9)   -0.007 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3840/GBP, high of US$1.3893/GBP and settled the day up by 0.124% to close at US$1.3846/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 1.3300-1.3200 with targets 1.3420-1.3490-1.3540 and 1.3605-1.3685 with stop loss closing below 1.3200. Sell in between 1.3390-1.3685 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 Tuesday made intra‐day low of JPY112.52/USD and made an intraday high of JPY113.88/USD and settled the day down 0.324 % at JPY113.14/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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