AAFX TRADING

Daily Market Lookup

  • The U.S. dollar edged lower Wednesday, but remained in a tight range the day before the release of key inflation data which could confirm the start of the Federal Reserve’s policy tightening process. The speed and timing of when central banks across the world start to lift interest rates is the main factor driving the foreign exchange markets these days, and in particular the Federal Reserve given the importance of the U.S. economy to global growth. The dollar received a boost at the end of last week with the release of a much stronger than expected jobs report, and Thursday’s consumer price index should cement expectations that the U.S. central bank will raise interest rates next month. The headline CPI is seen rising 0.5% on the month and 7.3% on the year in January, climbing to a four-decade high. Most in the market expected the Fed to lift interest rates by 25 basis points in March, a stronger print could offer support to those tipping a larger 50 basis point rise. Retreating from the highs seen last week after the European Central Bank policy meeting, as President Christine Lagarde tried Monday to rein in these expectations for aggressive action with growth in the Eurozone still fragile. Later Wednesday, the Riksbank holds its latest policy-setting meeting, with the markets increasingly looking at still-dovish central banks given the recent shift in many of their peers.
  • European Central Bank’s president Christine Lagarde said on Monday that there is no need for extensive tightening, tapping down rising expectations of aggressive interest rate hikes. The dollar index is "in a holding pattern while markets weigh up the prospect of an abrupt Fed policy tightening against the ECB's hawkish backflip," Westpac analysts wrote in a client note Although a more hawkish ECB might cap dollar gains near-term, the dollar's “medium-term bull trend is still intact,” and the dollar index is a buy on dips to the low 95 level, the notes added. Investors now await U.S. inflation data, including the consumer price index, due on Thursday for more clues on the timeline of the interest rate hikes. San Francisco Fed President Mary Daly said on Tuesday that U.S. inflation might even go higher before getting better.
  • Gold was up on Wednesday morning in Asia given the ongoing pressure from U.S. inflation. However, rising U.S. treasuries yield and growing expectations on U.S. Federal Reserve interest rate hikes kept the gains in check. Investors now await inflation data due on Thursday for more clues on the Fed’s timeline on interest rate hikes. Markets are now pricing in a one-in-three chance that the Fed will hike interest rates in March 2022. San Francisco Fed President Mary Daly said on Tuesday that U.S. inflation might even go higher before getting better. Across the Atlantic, European Central Bank’s president Christine Lagarde said on Monday that there is no need for extensive tightening as inflation is set to fall back and could stabilize, tapping down rising expectations of aggressive interest rate hikes.
  • Oil prices climbed on Wednesday after two sessions of losses as industry data showed an unexpected drop in U.S. crude and fuel stocks, offsetting concerns of a possible rise in supplies from Iran. U.S. crude, gasoline and distillate stocks fell last week, according to market sources citing American Petroleum Institute figures on Tuesday. Crude inventories fell 2 million barrels, according to API, versus analysts' expectations of a 400,000-barrel increase. More data from the U.S. EIA will be available at 10:30 a.m. EST (1530 GMT). Still, concerns about a possible Iran nuclear deal that could unleash more oil into global markets weighed on prices Brent and WTI slid about 2% on Tuesday, down for a second straight session, as Washington resumed indirect talks with Iran to revive a nuclear deal. Such a deal could lift U.S. sanctions on Iranian oil and quickly add supplies to the market, although a number of vital issues still need to be ironed out. Oil prices at near $100 a barrel could also draw more production from the United States. The Energy Information Administration expects U.S. crude output to rise 770,000 barrels per day to 11.97 million bpd in 2022 Meanwhile, governments from the United States to Japan are looking at ways to tackle high oil prices as inflation soars. In Europe, concerns over Ukraine eased as French President Emmanuel Macron said he believed steps could be taken to de-escalate the crisis after a meeting with Russian President Vladimir Putin and called on all sides to stay calm. Oil prices close to $100 a barrel could also draw more production from the U.S. The EIA expects U.S. crude output to rise 770,000 barrels per day to 11.97 million bpd this year. Concerns over Ukraine were on hold. French President Emmanuel Macron has indicated that steps can be taken to de-escalate the crisis after meeting with Russian President Vladimir Putin and urged all sides to stay calm.

 

 
Intraday RESISTANCE LEVELS
9th February 2022 R1 R2 R3
GOLD-XAU 1,831-1,841 1,849 1,856-1,864
Silver-XAG 22.90-23.15 23.80 24.40-24.90
Crude Oil 88.20-89.00 90.40 91.00-91.90
EURO/USD 1.1485-1.1525 1.1570 1.1600-1.1640
GBP/USD 1.3590-1.3640 1.3700 1.3750-1.3800
USD/JPY 115.40 115.70 116.10-116.80

Intraday SUPPORTS LEVELS
9th February 2022 S1 S2 S3
GOLD-XAU 1,824-1,808 1,800 1,783-1,777
Silver-XAG 22.50-21.90 21.50 21.05-19.50
Crude Oil 87.60-87.00 85.90 85.50-84.00
EURO/USD 1.1400-1.1355 1.1270 1.1230-1.1210
GBP/USD 1.3540-1.3500 1.3410 1.3350-1.3300
USD/JPY 115.00-114.50 114.05 113.70-113.20

Intra-Day Strategy (9th February 2022)
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$1828.68/oz and low of US$1815.36/oz. Gold up % at US$1825.70/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 1814-1769 with risk below 1769, targeting 1818-1832-1841 and 1849-1856. Sell in between 1818-1860 keeping stop loss closing above 1860, targeting 1804-1790-1783 and 1777-1769-1760.

 
Intraday Support Levels
S1     1,824-1,808
S2     1,800
S3     1,783-1,777
Intraday Resistance Levels
R1     1,831-1,841
R2     1,849
R3     1,856-1,864

Technical Indicators

Name   Value Action
14DRSI  

49.409

Buy
20-DMA   1811.62 Sell
50-DMA  

1808.32

Buy
100-DMA   1803.82 Buy
200-DMA   1801.48 Buy
STOCH(5,3)   78.923 Buy
MACD(12,26,9)   0.746 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$23.24/oz and low of US$22.76/oz settled up by 0.791% at US$23.17/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 22.50-20.50, targeting 23.15-23.70-24.10 and 24.55-24.90- 25.40 with stop loss should be place on the breakage below 20.50. Sell in between 23.10-25.40 with stop loss above 25.40; targeting 22.50-22.10-21.90 and 21.40-21.00.

 
Intraday  Support Levels
S1     22.50-21.90
S2     21.50
S3     21.05-19.50

Intraday  Resistance Levels
R1     22.90-23.15
R2     23.80
R3     24.40-24.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.015 Buy
20-DMA   22.93 Sell
50-DMA   23.05 Sell
100-DMA   23.35 Sell
200-DMA   23.81 Sell
STOCH(5,3)   54.764 Buy
MACD(12,26,9)   -0.119 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US90.47/bbl, intraday low of US$87.43/bbl and settled down by 1.927% to close at US$88.67/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 88.20-92.00 with stop loss at 94.00; targeting 87.60-87.00-86.20 and 85.60-84.00. Buy above 87.60-84.00 with risk daily closing below 84.00 and targeting 88.20-89.00-90.40 and 91.00-91.90-92.55.

 
Intraday Support Levels
S1     87.60-87.00
S2     85.90
S3     85.50-84.00

Intraday Resistance Levels
R1     88.20-89.00
R2     90.40
R3     91.00-91.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   77.730 Sell
20-DMA   85.44 Buy
50-DMA   81.10 Buy
100-DMA   77.93 Buy
200-DMA   72.96 Buy
STOCH(5,3)   85.873 Buy
MACD(12,26,9)   2.990 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1395/EUR, high of US$1.1448/EUR and settled the day down by 0.229% to close at US$1.1414/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.347), which become immediate support, break below will target 1.1270. 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 1.1400-1.1220 with risk below 1.1220, targeting 1.1485-1.1525-1.1570 and 1.1620-1.1650. Sell below 1.1485-1.1650, targeting 1.1420-1.1385-1.1310 and 1.1250-1.1200-1.1170 with stop-loss at daily closing above 1.1650.

 
Intraday Support Levels
S1     1.1400-1.1355
S2     1.1270
S3     1.1230-1.1210

Intraday  Resistance Levels
R1     1.1485-1.1525
R2     1.1570
R3     1.1600-1.1640

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.407 Buy
20-DMA   1.1328 Buy
50-DMA   1.1347 Buy
100-DMA   1.1435 Buy
200-DMA   1.1570 Sell
STOCH(5,3)   89.547 Sell
MACD(12,26,9)   0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3489/GBP, high of US$1.3563/GBP and settled the day up by 0.509% to close at US$1.3537/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 1.3540-1.3350 with target 1.3590-1.3640-1.3700 and 1.3750-1.3800-1.3840 with stop loss closing below 1.3300. Sell in between 1.3590-1.3840 with targets at 1.3500-1.3440-1.3390 and 1.3300-1.3250 with stop loss should be 1.3790.

 
Intraday Support Levels
S1     1.3540-1.3500
S2     1.3410
S3     1.3350-1.3300

Intraday Resistance Levels
R1     1.3590-1.3640
R2     1.3700
R3     1.3750-1.3800

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

50.849

Buy
20-DMA   1.3520 Buy
50-DMA   1.3500 Buy
100-DMA   1.3535 Buy
200-DMA   1.3580 Buy
STOCH(5,3)   66.766 Buy
MACD(12,26,9)   -0.039 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY115.04/USD and made an intraday high of JPY115.62/USD and settled the day up 0.422% at JPY115.52/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

Sell below 114.90-116.50 with risk above 116.50 targeting 14.50-113.90 and 113.20-112.70-112.50. Long positions above 114.50-112.50 with targets of 114.65-115.00-115.50 and 116.00-116.50-116.90 with stop below 112.50.

 
Intraday Support Levels
S1     115.00-114.50
S2     114.05
S3     113.70-113.20

INTRADAY RESISTANCE LEVELS
R1     115.40
R2     115.70
R3     116.10-116.80

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.1338 Buy
20-DMA   114.84 Sell
50-DMA   114.19 Buy
100-DMA   113.17 Buy
200-DMA   111.59 Buy
STOCH(9,6)   11.683 Sell
MACD(12,26,9)   0.0102 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING