AAFX TRADING

Daily Market Lookup

  • The dollar leapt against its more risk-sensitive Australian and New Zealand counterparts on Friday, ahead of key U.S. jobs data that could clear the path to earlier Federal Reserve interest rate hikes, even as Omicron uncertainties cloud the outlook. Fed officials speaking on Thursday joined Chair Jerome Powell in striking hawkish stances, with San Francisco Fed President Mary Daly saying it may be time to "start crafting a plan" to raise rates to combat inflation, and Richmond Fed President Thomas Barkin throwing his support behind "normalising policy." Meanwhile, the continued spread of the Omicron COVID-19 variant globally buoyed havens like the dollar and yen and pressured riskier currencies. Omicron has quickly established itself as the dominant strain in South Africa, where it was first discovered last month, and has now been found in five U.S. states including Hawaii. Money markets see high odds that the Fed will raise the target rate by a quarter point at its June meeting. Powell reiterated in testimony to Congress on Wednesday that he and fellow policymakers will consider swifter action at their Dec. 14-15 meeting. Economists in a Reuters poll estimate the United States created 530,000 new jobs last month, continuing a run of strong data. Both the European Central Bank and Reserve Bank of Australia, which decides policy on Tuesday, have stuck to dovish stances, pushing back against market bets that policymakers will be forced to bow to inflationary pressures.
  • The dollar was up on Friday morning in Asia, with markets adopting a broadly calmer tone. Investors now await the latest U.S. jobs report that includes non-farm payrolls, due later in the day. The U.S. Federal Reserve reinforced the hawkish stance shown by Chairman Jerome Powell earlier in the week. San Francisco Fed President Mary Daly said it may be time to "start crafting a plan" to hike interest rates to combat inflation, and Richmond Fed President Thomas Barkin showed support for "normalizing policy." Bets are rising that the central bank will raise the target rate by a quarter point at its June 2022 meeting. In terms of the newly discovered omicron COVID-19 variant, headlines were "net positive" overnight, helping risk sentiment to recover. However, with the first assessments of the efficacy of current vaccines probably still a week or so away, "we expect ongoing volatility," the note added. For Friday though, "the U.S. labor market takes center stage," and should keep currency markets quiet, the report added, in reference to the U.S. jobs report. Thursday’s U.S. initial jobless claims data said that 222,000 claims were filed throughout the week. Meanwhile, Didi Global Inc. (NYSE:DIDI) said that it will delist from the New York Stock Exchange and list on the Hong Kong Stock Exchange.
  • Gold was up on Friday morning in Asia. However, the yellow metal was set for a third, consecutive weekly fall, weighed down by signs that the U.S. Federal Reserve will quicken the pace of asset tapering and hike interest rates earlier than expected to curb inflationary pressures. The U.S. Federal Reserve continues to reinforce its message that it will quicken the pace of asset tapering. Atlanta Fed President Raphael Bostic told the Reuters Next conference on Thursday that it would be appropriate to end the Fed’s bond-buying program by the end of March 2022.This would give the Fed the option to hike interest rates to deal with inflation, he added. U.S. Treasury Secretary Janet Yellen added at the conference that it was the Fed's job to ensure that the current run of high inflation does not evolve into a damaging and long-lasting "wage-price spiral". Meanwhile, U.S. data released on Thursday showed that 222,000 initial jobless claims were filed throughout the week. The latest U.S. jobs report, including non-farm payrolls, is due later in the day. Oil prices climbed on Friday, extending gains after OPEC+ said it would review supply additions ahead of its next scheduled meeting if the Omicron variant dents demand, but prices were still on course for a sixth week of declines. The Organization of the Petroleum Exporting Countries, Russia and allies, together called OPEC+, surprised the market on Thursday when it stuck to plans to add 400,000 barrels per day (bpd) supply in January. However the producers left the door open to changing policy swiftly if demand suffered from measures to contain the spread of the Omicron coronavirus variant. They said they could meet again before their next scheduled meeting on Jan. 4, if needed. That boosted prices with "traders reluctant to bet against the group eventually pausing its production increases," ANZ Research analysts said in a note. Wood Mackenzie analyst Ann-Louise Hittle said it made sense for OPEC+ to stick with their policy for now, given it was still unclear how mild or severe Omicron turns out to be compared with previous variants. The market has been roiled all week by the emergence of Omicron and speculation that it could spark new lockdowns, dent fuel demand and spur OPEC+ to put its output increases on hold. For the week, Brent was poised to end down about 2.6%, while WTI was on track for a less than 1% drop, with both heading lower for a sixth straight week. JPMorgan (NYSE:JPM) analysts said the market fall implied an "excessive" hit to demand, while global mobility data, excluding China, showed that mobility is continuing to recover, averaging at 93% of 2019 levels last week.

 

 
Intraday RESISTANCE LEVELS
3rd December 2021 R1 R2 R3
GOLD-XAU 1,778-1,784 1,800 1,808-1,818
Silver-XAG 22.60-23.10 24.10 24.80-25.10
Crude Oil 67.90-69.10 70.10 70.60-71.50
EURO/USD 1.1310-1.1360 1.1385 1.1420-1.1485
GBP/USD 1.3300-1.33901.3100-1.3050 1.3420 1.3490-1.3540
USD/JPY ¬113.45-113.90 114.50 115.00-115.90

Intraday SUPPORTS LEVELS
3rd December 2021 S1 S2 S3
GOLD-XAU 1,769-1,758 1,750 1,744-1,736
Silver-XAG 22.10-21.40 21.00 20.50-19.90
Crude Oil 67.30-66.90 66.00 65.40-64.90
EURO/USD 1.1240 1.1170 1.1120-1.1050
GBP/USD 1.3270-1.3200 1.3150 1.3100-1.3050
USD/JPY 113.00-112.70 112.10 111.50-111.00

Intra-Day Strategy (3rd 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 Thursday made its intraday high of US$1783.25/oz and low of US$1761.78/oz. Gold up 0.717% at US$1768.68/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 1769-1740 with risk below 1740, targeting 1778-1790-1800 and 1808-1818-1834. Sell in between 1790-1818 keeping stop loss closing above 1820, targeting 1771-1765.

 
Intraday Support Levels
S1     1,769-1,758
S2     1,750
S3     1,744-1,736
Intraday Resistance Levels
R1     1,778-1,784
R2     1,800
R3     1,808-1,818

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 Thursday made its intraday high of US$22.49/oz and low of US$22.20/oz settled down by 0.251% at US$22.36/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 22.10-20.90, targeting 23.20-24.05-24.55 and 25.05-25.50-25.90 with stop loss should be place on the breakage below20.90. Sell in between 22.60-26.50 with stop loss above 26.50; targeting 22.10-21.40 and 21.00-20.50.

 
Intraday  Support Levels
S1     22.10-21.40
S2     21.00
S3     20.50-19.90

Intraday  Resistance Levels
R1     22.60-23.10
R2     24.10
R3     24.80-25.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   31.467 Buy
20-DMA   23.46 Sell
50-DMA   23.70 Sell
100-DMA   24.04 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 Thursday made an intra‐day high of US$67.31/bbl, intraday low of US$62.30/bbl and settled up by 2.59% to close at US$67.19/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 67.90-71.90 with stop loss at 71.90; targeting 67.30-66.90-66.00 and 65.40-64.90-64.10. Buy above 67.30-64.90 with risk daily closing below 64.90 and targeting 67.90-68.40 and 69.10-70.10-71.00.

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

Intraday Resistance Levels
R1     67.90-69.10
R2     70.10
R3     70.60-71.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   33.044 Sell
20-DMA   73.74 Sell
50-DMA   75.67 Buy
100-DMA   74.03 Buy
200-DMA   69.10 Buy
STOCH(5,3)   28.873 Buy
MACD(12,26,9)   0.933 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1294/EUR, high of US$1.1346/EUR and settled the day down by 0.155% to close at US$1.1300/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 1.1240-1.1170 with risk below 1.1170, targeting 1.1360-1.1385-1.1420 and 1.1485-1.1510-1.1590. Sell below 1.1310-1.1540 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     1.1240
S2     1.1170
S3     1.1120-1.1050

Intraday  Resistance Levels
R1     1.1310-1.1360
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 Thursday made an intra‐day low of US$1.3263/GBP, high of US$1.3333/GBP and settled the day up by 0.178% to close at US$1.3297/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 1.3270-1.3050 with targets 1.3300-1.3390-1.3420 and 1.3490-1.3540 with stop loss closing below 1.3050. Sell in between 1.3300-1.3540 with targets at 1.3265-1.3200-1.3150 and 1.3100-1.3050 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3270-1.3200
S2     1.3150
S3     1.3100-1.3050

Intraday Resistance Levels
R1     1.3300-1.33901.3100-1.3050
R2     1.3420
R3     1.3490-1.3540

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

32.480

Buy
20-DMA   1.3403 Buy
50-DMA   1.3528 Buy
100-DMA   1.3631 Buy
200-DMA   1.3650 Buy
STOCH(5,3)   51.766 Buy
MACD(12,26,9)   -0.006 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY112.60/USD and made an intraday high of JPY113.32/USD and settled the day down 0.205% at JPY112.97/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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