AAFX TRADING

Daily Market Lookup

  • The U.S. dollar edged lower Wednesday, continuing the previous session’s selloff as news of the withdrawal of some Russian troops from the Ukraine border drained some geopolitical risk premium from the market. The change in risk sentiment followed Russia announcing it was returning to barracks some of its troops positioned near Ukraine after the completion of exercises. That said, the dollar's losses are fairly minor. NATO chief General Jens Stoltenberg, warned that the military alliance has so far “not seen any sign of de-escalation on the ground from the Russian side”, while Ukraine suffered a cyberattack on the online networks of its defense ministry and two banks. Additionally, traders are wary of fully deserting the greenback ahead of the release of the minutes from the most recent Federal Reserve meeting, at which the policy makers in all likelihood discussed raising interest rates at its March meeting. The Bank of England has already raised interest rates twice since December in an attempt to combat this surging inflation, and a further rate rise from the current 0.5% is expected in March at the central bank's next meeting. The dollar was up on Wednesday morning in Asia, while the euro held on to overnight gains in early Asia Pacific trade. Investors also digested reports that Russia could move forces away from its border with Ukraine, alongside the latest economic data from China. The Russian defense ministry on Tuesday published footage to show it was withdrawing some troops from the border with Ukraine after exercises. However, U.S. President Joe Biden said that the U.S. had not verified the move, while Ukraine reported a cyber-attack on the online networks of its defense ministry and two banks mere hours after the Russian announcement. However, some investors were optimistic that the dollar’s losses would be capped. The dollar "shed ground overnight as the Ukraine geopolitical risk premium came out of markets, but expectations of an aggressive Fed hike cycle should keep a base for the dollar index in place," said Westpac analysts in a note The U.S. Federal Reserve is widely expected to hike interest rates at its March 2022 meeting, with several more hikes also likely to follow throughout the year. Investors now await the minutes from the Fed’s last meeting later in the day, which could influence the dollar and U.S. rates’ movements. The yield on benchmark 10-year Treasury notes was last at 2.0329. A debate among Fed officials on how aggressively the central bank should hike interest rates also continues. St. Louis Fed President James Bullard on Monday repeated calls to speed up the pace of Fed rate hikes, but some of his colleagues are less keen to commit to a half-point hike or were even concerned it could cause trouble. Across the Atlantic, the Bank of England could hike its own interest rates by a further 25 basis points at its March meeting, according to a Reuters poll of economists. The central bank last hiked rates at three consecutive meetings in 1997.
  • Gold was down on Wednesday morning in Asia, coming down from an eight-month high hit during a volatile previous session. Easing fears of a Russian invasion of Ukraine negated the support to the yellow metal from weaker bond yields. Asian shares rebounded from recent losses, with a Russian announcement that it would withdraw some troops from the border with Ukraine diffusing ears of an armed conflict in the area. Looking ahead, the more fungible dollar is the preferred safe-haven to gold among core investors and could fall on any further de-escalation in the Ukraine crisis, prompting a rally in gold and vice-versa, AirGuide director Michael Langford told Reuters. The U.S. Federal Reserve is widely expected to hike interest rates in March 2022, with a Reuters poll predicting a 25 basis-point increase. However, a growing minority predicts that the central bank will opt for a more aggressive half-point hike to cool high inflation. The Fed also releases the minutes from its last meeting later in the day.
  • Oil prices recouped losses on Wednesday after slipping more than 3% in the previous session, as investors gauged the impact of easing Russia-Ukraine tension against a taut balance of tight global supplies and recovering fuel demand. Both benchmarks had hit their highest since September 2014 on Monday, with Brent touching $96.78 and WTI reaching $95.82. The price of Brent jumped 50% in 2021, while WTI soared about 60%, as a global recovery in demand from the COVID-19 pandemic strained supply. Moscow's Tuesday announcement of a partial pullback in troops from Ukraine's borders was met with scepticism, as U.S. President Joe Biden warned that more than 150,000 Russian troops were still massed near the borders. But beyond the Ukraine tension, the oil market remains tight and prices are still on course for a move towards $100 a barrel, analysts said. While the Ukraine crisis simmered, the U.S. Labor Department reported producer prices increased by the most in eight months in January, a reminder that high inflation could persist through much of this year. Investors await weekly U.S. oil inventories data from the Energy Information Administration due at 10:30 a.m. (1530 GMT) on Wednesday. U.S. crude and distillates inventories may have fallen by 1.5 million to 1.6 million barrels last week, a Reuters poll showed. Data from the American Petroleum Institute showed a drop in crude, gasoline and distillate stocks last week, according to market sources on Tuesday.

 

 
Intraday RESISTANCE LEVELS
16th February 2022 R1 R2 R3
GOLD-XAU 1,856-1,865 1,870 1,879-1,890
Silver-XAG 23.90 24.40 24.90-25.50
Crude Oil 93.00- 93.90 94.50 95.20-96.00
EURO/USD 1.1400 1.1485 1.1525-1.1570
GBP/USD 1.3590-1.3640 1.3700 1.3750-1.3800
USD/JPY 115.70-116.10 116.80 117.50-118.00

Intraday SUPPORTS LEVELS
16th February 2022 S1 S2 S3
GOLD-XAU 1,849-1,841 1,831 1,824-1,817
Silver-XAG 23.15-22.90 22.50 21.90-21.50
Crude Oil 92.50- 91.90 91.00 90.40-89.00
EURO/USD 1.1355-1.1305 1.1270 1.1230-1.1200
GBP/USD 1.3500 1.3410 1.3350-1.3300
USD/JPY 115.00 114.50 114.05-113.70

Intra-Day Strategy (16th 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$1879.41/oz and low of US$1844.44/oz. Gold down 0.950% at US$1853.26/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 1850-1817 with risk below 1817, targeting 1859-1870-1876 and 1885-1894. Sell in between 1880-1900 keeping stop loss closing above 1900, targeting 1874-1865-1856 and 1849-1840-1833.

 
Intraday Support Levels
S1     1,849-1,841
S2     1,831
S3     1,824-1,817
Intraday Resistance Levels
R1     1,856-1,865
R2     1,870
R3     1,879-1,890

Technical Indicators

Name   Value Action
14DRSI  

65.587

Buy
20-DMA   1820.68 Sell
50-DMA  

1812.81

Buy
100-DMA   1806.50 Buy
200-DMA   1802.93 Buy
STOCH(5,3)   84.016 Buy
MACD(12,26,9)   5.877 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$23.97/oz and low of US$23.06/oz settled down by 2.05% at US$23.34/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 23.15-20.50, targeting 24.10 and 23.90-24.55-24.90 and 25.40-26.00 with stop loss should be place on the breakage below 20.50. Sell in between 23.90-25.90 with stop loss above 25.90; targeting 23.15-22.90 and 22.50-22.10-21.90.

 
Intraday  Support Levels
S1     23.15-22.90
S2     22.50
S3     21.90-21.50

Intraday  Resistance Levels
R1     23.90
R2     24.40
R3     24.90-25.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.467 Buy
20-DMA   23.19 Sell
50-DMA   23.14 Sell
100-DMA   23.36 Sell
200-DMA   23.79 Sell
STOCH(5,3)   63.764 Buy
MACD(12,26,9)   -0.119 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US9/bbl, intraday low of US$90.58/bbl and settled up by 0.661% to close at US$92.96/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 91.90-94.50 with stop loss at 94.50; targeting 91.00-90.40-89.00 and 88.20-87.60-87.00. Buy above 91.00-90.40 with risk daily closing below 90.40 and targeting 91.90-92.50-93.00 and 93.90-94.50.

 
Intraday Support Levels
S1     92.50- 91.90
S2     91.00
S3     90.40-89.00

Intraday Resistance Levels
R1     93.00- 93.90
R2     94.50
R3     95.20-96.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   70.624 Sell
20-DMA   87.30 Buy
50-DMA   82.72 Buy
100-DMA   79.08 Buy
200-DMA   73.79 Buy
STOCH(5,3)   65.108 Sell
MACD(12,26,9)   2.934 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1287/EUR, high of US$1.1367/EUR and settled the day up by 0.460% to close at US$1.1357/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 1.1355-1.1220 with risk below 1.1220, targeting 1.1485-1.1525-1.1570 and 1.1620-1.1650. Sell below 1.1400-1.1570, targeting 1.1350-1.1270-1.1230 and 1.1200-1.1185 with stop-loss at daily closing above 1.1650.

 
Intraday Support Levels
S1     1.1355-1.1305
S2     1.1270
S3     1.1230-1.1200

Intraday  Resistance Levels
R1     1.1400
R2     1.1485
R3     1.1525-1.1570

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 Monday made an intra‐day low of US$1.3485/GBP, high of US$1.3566/GBP and settled the day down by 0.102% to close at US$1.3532/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 1.3500-1.3350 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     1.3500
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 Tuesday made intra‐day low of JPY115.25/USD and made an intraday high of JPY115.87/USD and settled the day up 0.508% at JPY115.56/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 115.90-118.00 with risk above 118.00 targeting 115.40-115.00-114.50 and 113.90-113.20-112.70. Long positions above 115.00-113.70 with targets of 115.50-116.35-116.90 with stop below 113.70.

 
Intraday Support Levels
S1     115.00
S2     114.50
S3     114.05-113.70

INTRADAY RESISTANCE LEVELS
R1     115.70-116.10
R2     116.80
R3     117.50-118.00

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
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