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Daily Market Lookup

  • The dollar was up on Tuesday morning in Asia. Meanwhile, the yen traded near a one-month low to the U.S. currency as uncertainty about the omicron COVID-19 variant was largely consigned to the background, and investors’ risk appetite improved. Data released earlier in the day in Japan also said that industrial production grew a better-than-expected 7.2% month-on-month in November. It also said that the jobs/application ratio was 1.15, while the unemployment rate was 2.8%, in November. U.S. shares were on an upward trend, with the S&P 500 closing at a record high on Monday. The safe-haven U.S. dollar remained near toward the bottom end of its recent trading range, even as a hawkish tilt by the U.S. Federal Reserve at its latest policy meeting earlier in the month. The U.S. equities rally "implies that currently investor risk appetite must be very, very strong" despite expectations for faster Fed tightening, he added, predicting that the yen is likely to test its 2021 low in the near term.
  • The dollar was flat in early trading in Europe on Friday, on course to end the week lower after encouraging signs from the pandemic revived global risk appetite, supporting higher yielders. However, the dollar has lost between 1% and 1.5% this week against sterling and the Canadian, Australian and New Zealand dollars, and nearly 1% against the euro, as scientific data has dribbled out suggesting that the latest wave of the pandemic will be less economically damaging than previous ones. The only notable gains it has made have been against other haven currencies, such as the Japanese yen and the Swiss franc. Data released on Thursday that showed sustained inflationary pressure in the U.S. weren't enough to upset the broader optimism as a growing body of evidence suggested that the Omicron variant of Covid-19 is less likely than all previous dominant strains to lead to serious illness. The more evidence goes in that direction, the less likely disruptions to economic life will become. Trading has now all but stopped ahead of the Christmas holiday period, but markets remain at least formally open. As has been the case all week, the sharpest moves are in the Turkish lira, whose rally in response to President Recep Tayyip Erdogan's attempts to stop dollar hoarding now appears to be running out of steam. From a high of over 18 lira last week, the dollar fell as low as 10.1565 on Thursday before starting to gain ground again. By 3:30 AM ET, it traded at 11.6279, up 3.6% on the day. The Russian ruble was testing its highest level in over a month after news suggesting that talks with the U.S. to de-escalate the situation on the Ukrainian border may take place in the near future. President Vladimir Putin slightly dialed down the tension at his annual press conference on Thursday, declining to repeat a threat of military action that he had made in a speech earlier in the week. The South African rand also strengthened after fresh data showing that the first country to identify the Omicron variant of Covid-19 may soon put its latest infection wave behind it. The 7-day average for new infections is already down by around a quarter from its peak last week.
  • Gold was up on Tuesday morning in Asia despite a strong U.S. stocks market as investors monitor the impact of the Omicron variant on the economy. U.S. retail sales rose 8.5% from Nov. 1 to Dec. 24, according to MasterCard Inc.'s Spending Pulse survey. The survey, released on Sunday, improved investor sentiment and boosted U.S. shares to record highs. Investors are also monitoring the impact of omicron on the economic recovery. The U.K. will not tighten restrictive measures before the end of the year despite the number of surging cases. France will further tighten COVID-19 measures but will not impose a curfew for New Year's Eve. The U.S. also cut recommended isolation time for infected Americans from 10 to five days. In Asia Pacific, the Chinese city of Xi’an tightened curbs on travel on Monday, its fifth day of a strict lockdown. Xi’an reported 150 local cases on Sunday. The People’s Bank of China also reiterated on Monday that the yuan exchange rate will be more flexible in 2022 and will remain stable overall at a reasonable and balanced level. The central bank added that it will ensure the overall size of credit keeps growing in 2022. Japanese data released earlier in the day showed that industrial production grew a better-than-expected 7.2% month-on-month in November. The jobs/application ratio was 1.15, while the unemployment rate was 2.8%, in November.
  • Oil was mixed on Tuesday morning in Asia as optimism on Omicron’s impact rose. However, supplies remained tight. As a result, the UK's government will not introduce new COVID-19 restrictions for England before the end of 2021, according to its health minister. But even then, U.S. airlines cancelled more than 1,300 flights on Sunday as COVID-19 brought down the head count of staff and a number of cruise ships had to cancel stops. Oil prices have jumped by over 50% this year, driven by recovering demand and supply cuts by the Organization of the Petroleum Exporting Countries and its allies, or OPEC+. Talks on reviving Tehran's 2015 nuclear deal resumed on Monday between world powers and Iran. Iran stated that oil exports were the focus of the talks, which so far has not boosted its shipments. The next OPEC+ meeting on Jan. 4 will see if the cartel will go ahead with a planned 400,000 barrels-per-day (bpd) production increase for February. The producer alliance stuck to its plans at its last meeting to boost output for January despite Omicron. Investors now await U.S. crude oil supply data from the American Petroleum Institute, due later in the day.

 

 
Intraday RESISTANCE LEVELS
28th December 2021 R1 R2 R3
GOLD-XAU 1,818-1,824 1,834 1,840-1,848
Silver-XAG 23.15-23.80 24.50 24.90-25.50
Crude Oil 76.00-76.50 77.55 78.20-79.00
EURO/USD 1.1340-1.1385 1.1420 1.1485-1.1510
GBP/USD 1.3440-1.3490 1.3550 1.3610-1.3700
USD/JPY 115.00 115.90 116.50-116.90

Intraday SUPPORTS LEVELS
28th December 2021 S1 S2 S3
GOLD-XAU 1,808-1,800 1,785 1,778-1,769
Silver-XAG 22.60-22.10 21.40 21.00-20.50
Crude Oil 75.20-74.60 74.00 73.30-72.50
EURO/USD 1.1240-1.1170 1.1120 1.1050-1.1100
GBP/USD 1.3200 1.3200 1.3150-1.3100
USD/JPY 114.50-113.90 113.50 113.10-112.70

Intra-Day Strategy (28th 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 Monday made its intraday high of US$1813.35/oz and low of US$1802.86/oz. Gold up 0.240% at US$1811.94/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 1808-1758 with risk below 1758, targeting 1818-1824 and 1831-1840. Sell in between 1808-1831 keeping stop loss closing above 1820, targeting 1783-1774-1769 and 1758-1750.

 
Intraday Support Levels
S1     1,808-1,800
S2     1,785
S3     1,778-1,769
Intraday Resistance Levels
R1     1,818-1,824
R2     1,834
R3     1,840-1,848

Technical Indicators

Name   Value Action
14DRSI  

48.253

Buy
20-DMA   1789.95 Buy
50-DMA  

1793.06

Buy
100-DMA   1794.81 Buy
200-DMA   1796.27 Buy
STOCH(5,3)   53.940 Buy
MACD(12,26,9)   -3.816 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$23.10/oz and low of US$22.63/oz settled up by 0.826% at US$23.04/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 22.60-20.50, targeting 22.60-23.20 and 23.80-24.05-24.55 with stop loss should be place on the breakage below 20.10. Sell in between 22.90-24.50 with stop loss above 24.50; targeting 21.40-21.00-20.50 and 19.90-19.50.

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

Intraday  Resistance Levels
R1     23.15-23.80
R2     24.50
R3     24.90-25.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   36.673 Buy
20-DMA   22.70 Sell
50-DMA   23.24 Sell
100-DMA   24.17 Sell
200-DMA   24.17 Sell
STOCH(5,3)   54.891 Buy
MACD(12,26,9)   -0.186 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US75.90/bbl, intraday low of US$72.43/bbl and settled up by 3.44% to close at US$75.75/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 76.00-79.00 with stop loss at 79.00; targeting 75.20-74.60-74.00 and 73.30-72.50-71.60. Buy above 75.20-72.90 with risk daily closing below 72.90 and targeting 76.00-76.50-77.55 and 78.20-79.00.

 
Intraday Support Levels
S1     75.20-74.60
S2     74.00
S3     73.30-72.50

Intraday Resistance Levels
R1     76.00-76.50
R2     77.55
R3     78.20-79.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.522 Sell
20-DMA   72.09 Sell
50-DMA   74.24 Buy
100-DMA   73.51 Buy
200-DMA   69.25 Buy
STOCH(5,3)   43.873 Buy
MACD(12,26,9)   -1.741 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1302/EUR, high of US$1.1333/EUR and settled the day up by 0.183% to close at US$1.1326/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 1.1240-1.1100 with risk below 1.1100, targeting 1.1340-1.1385-1.1420 and 1.1485-1.1510-1.1590. Sell below 1.1340-1.1540 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     1.1240-1.1170
S2     1.1120
S3     1.1050-1.1100

Intraday  Resistance Levels
R1     1.1340-1.1385
R2     1.1420
R3     1.1485-1.1510

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.652 Buy
20-DMA   1.1322 Sell
50-DMA   1.1433 Sell
100-DMA   1.1567 Sell
200-DMA   1.1688 Sell
STOCH(5,3)   44.685 Buy
MACD(12,26,9)   -0.004 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3379/GBP, high of US$1.3444/GBP and settled the day up by 0.452% to close at US$1.3439/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 1.3390-1.3050 with target 1.3420 and 1.3490-1.3540 with stop loss closing below 1.3050. Sell in between 1.3440-1.3610 with targets at 1.3300-1.3265-1.3200 and 1.3150-1.3100-1.3050 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3200
S2     1.3200
S3     1.3150-1.3100

Intraday Resistance Levels
R1     1.3440-1.3490
R2     1.3550
R3     1.3610-1.3700

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 Monday made intra‐day low of JPY114.28/USD and made an intraday high of JPY114.90/USD and settled the day up 0.424% at JPY114.78/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 114.50-114.90-115.60 and 116.00-116.50-117.00 with stop below 106.00. Sell below 114.50-117.00 with risk above 117.00 targeting 113.90-113.20-112.70 and 112.10-111.50.

 
Intraday Support Levels
S1     114.50-113.90
S2     113.50
S3     113.10-112.70

INTRADAY RESISTANCE LEVELS
R1     115.00
R2     115.90
R3     116.50-116.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   55.065 Buy
20-DMA   113.67 Sell
50-DMA   113.29 Sell
100-DMA   112.34 Sell
200-DMA   110.87 Sell
STOCH(9,6)   69.683 Buy
MACD(12,26,9)   0.0102 Sell

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