AAFX TRADING

Daily Market Lookup

  • The dollar hit a new five-year top on the yen on Friday after a strong U.S. inflation report, while the euro struggled to hold its own as a hawkish turn from the European Central Bank was offset by growth risks emanating from the Ukraine crisis. Both the Federal Reserve and the Bank of Japan have policy meetings next week, but while the Fed is all but certain to hike rates from their pandemic low, the BOJ is set to remain an outlier and hold onto a dovish stance on monetary policy, weighing on the yen. Data on Thursday showed that U.S. consumer prices surged 7.9% year-over-year in February, the largest annual increase in 40 years, even before the surge in commodities prices caused by the war in Ukraine has had its full effect. The CPI data "basically indicates that the Fed should be hiking rates this month, but it also indicates that they will keep going [with hikes] at least initially," said Rodrigo Catrill, a currency strategist at National Bank of Australia. The CPI data "basically indicates that the U.S. Federal Reserve should be hiking rates this month, but it also indicates that they will keep going with interest rate hikes, at least initially," National Bank of Australia currency strategist Rodrigo Catrill told Reuters. The Fed and the Bank of Japan will both hand down policy decisions in the following week. While the Fed is widely expected to hike interest rates, its Japanese counterpart is choosing to maintain a more dovish stance.
  • The euro was last little changed at $1.1005. It finished a choppy Thursday 0.8% lower, but in the course of the day it had risen to as high as $1.112 and dropped as low as $1.0975. The ECB said on Thursday it will phase out its stimulus in the third quarter, opening the door to an interest rate hike before the end of 2022 to combat soaring inflation. It also modestly downgraded its growth forecasts for this year and next, and ramped up inflation expectations, as ECB President Christine Lagarde said the conflict was a "watershed for Europe", which would curb growth but boost inflation. Talks between Ukraine and Russia's foreign ministers on Thursday made little apparent progress towards ending a war that is now in its third week. Bitcoin was around $38,500, little changed on the week, despite a volatile few days as prices took a round trip in response to an executive order from U.S. President Joe Biden requiring the government to prepare reports on the future of money. He was referring to the ECB’s policy decision, handed down on Thursday, which kept the interest rate steady at 0% but said that the central bank will phase out its stimulus in the third quarter. The decision also leaves the possibility of an interest rate hike before the end of 2022 open. The ECB also modestly downgraded its growth forecasts for both 2022 and 2023, while ramping up inflation expectations. ECB President Christine Lagarde also called the conflict in Ukraine a "watershed for Europe" that would boost inflation but curb economic growth. Meanwhile, talks between Ukrainian foreign minister Dmytro Kuleba and his Russian counterpart Sergey Lavrov on Thursday made disappointingly little progress towards ending the conflict.
  • Gold was down on Friday morning in Asia, with U.S. Treasury yields gaining over the latest U.S. inflation report. However, it was set for a second weekly gain after talks between Russia and Ukraine made little progress. Data released on Thursday showed that the U.S. consumer price index (CPI) grew 7.9% year-on-year and 0.8% month-on-month in February. The core CPI grew 0.5% month-on-month and 6.4% year-on-year. Benchmark U.S. 10-year Treasury yields rose after the U.S. report, which also showed the sharpest increase in 40 years. Investors widely expect that the U.S. Federal Reserve will hike interest rates when it hands down its policy decision on Mar. 16. The European Central Bank kept its interest rate steady at 0% as it handed down its own policy decision on Thursday. However, it made an unexpected hawkish move of accelerating its wind-down of monetary stimulus. In Asia Pacific, the Bank of Japan will also hand down its policy decision in the following week. Investors have turned to safe-haven assets ever since Russia invaded Ukraine on Feb. 24, which gave the yellow metal a boost. Gold has jumped as much as 8.5% in the last two weeks and was close to its record levels hit in August 2020.
  • Oil was down on Friday morning in Asia, set for their biggest weekly drops since November 2021 but clawing back some losses. Market volatility also continued over concerns about more sanctions on Russian oil versus efforts to increase supply via other major producers. The black liquid is wrapping up a volatile week, with the U.S. and U.K. looking to ban Russian oil supplies earlier in the week, then floating potential supply additions from Iran, Venezuela and the United Arab Emirates, and fighting intensifying in the Russian invasion of Ukraine. However, oil eased after it looked like the European Union, which is heavily reliant on Russian supplies, would not join the U.S. and U.K.’s embargo Russia is the second largest crude exporter globally behind Saudi Arabia, and “the oil market is not prepared to face such a supply shock as inventories stand at a multi-year low level," ANZ Research analysts said in a report In the near term, supply gaps are unlikely to be filled by extra output from members of the Organization of the Petroleum Exporting Countries and allies (OPEC+) given that Russia is a member of the cartel, Commonwealth Bank analyst Vivek Dhar told Reuters. Other OPEC+ producers, including Angola and Nigeria, have struggled to hit their production targets. This further limits OPEC+’s ability to offset the loss of Russian crude.

 

 
Intraday RESISTANCE LEVELS
11th March 2022 R1 R2 R3
GOLD-XAU 1,990-2,006 2,016 2,028-2,040
Silver-XAG 26.00-26.50 27.00 27.50-27.80
Crude Oil 104.00-105.10 106.60 107.00-108.50
EURO/USD 1.1011-1.1050 1.1090 1.1105-1.1180
GBP/USD 1.3150-¬1.3200 1.3250 1.3290-1.3350
USD/JPY 116.80-117.50 -118.00

Intraday SUPPORTS LEVELS
11th March 2022 S1 S2 S3
GOLD-XAU 1,973-1,965 1,958 1,950-1,941
Silver-XAG 25.40-24.80 24.30 23.95-23.80
Crude Oil 102.40-101.60 100.00-99.20 98.30-97.75
EURO/USD 1.0950 1.0720 1.0640-1.0600
GBP/USD 1.3070 1.3035 1.2970-1.2925
USD/JPY 116.10-115.50 115.20 114.90-114.50

Intra-Day Strategy (11th March 2022)
GOLD-XAU Sell on Strength
Silver-XAG Buy on Dips
Crude Oil Neutral to Sell
EUR/USD Neutral to Sell
GBP/USD Neutral to Buy
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Thursday made its intraday high of US$2009.06/oz and low of US$1970.62/oz. Gold up 0.318% at US$1996.64/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: Sell on Strength

Sell below 1990-2050 keeping stop loss closing above 2050, targeting 1984-1973-1965 and 1958-1951-1941. Buy in between 1974-1941 with risk below 1941, targeting 1990-2006-2016 and 2028-2040-2050.

 
Intraday Support Levels
S1     1,973-1,965
S2     1,958
S3     1,950-1,941
Intraday Resistance Levels
R1     1,990-2,006
R2     2,016
R3     2,028-2,040

Technical Indicators

Name   Value Action
14DRSI  

63.570

Buy
20-DMA   1931.16 Buy
50-DMA  

1878.62

Buy
100-DMA   1845.71 Buy
200-DMA   1824.36 Buy
STOCH(5,3)   58.064 Buy
MACD(12,26,9)   23.493 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$26.05/oz and low of US$25.29/oz settled up by 0.520% at US$25.89/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 25.40-22.90, targeting 25.70-26.50-26.75 and 27.50-27.80 with stop loss should be place on the breakage below 22.90. Sell in between 25.70-27.90 with stop loss above 27.90; targeting 25.40-24.80 and 24.40-23.90-23.40.

 
Intraday  Support Levels
S1     25.40-24.80
S2     24.30
S3     23.95-23.80

Intraday  Resistance Levels
R1     26.00-26.50
R2     27.00
R3     27.50-27.80

TECHNICAL INDICATORS
Name   Value Action
14DRSI   72.012 Buy
20-DMA   23.69 Sell
50-DMA   23.38 Sell
100-DMA   23.46 Sell
200-DMA   23.81 Sell
STOCH(5,3)   89.836 Buy
MACD(12,26,9)   -0.119 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US111.82/bbl, intraday low of US$102.98/bbl and settled down by 3.976% to close at US$103.26/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 0will 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 104.00-108.50 with stop loss at 108.50; targeting 102.40-101.60-100.00 and 99.00-98.30-97.75. Buy above 102.40-97.75 with risk daily closing below 97.75 and targeting 104.00-105.10-106.60 and 107.00-108.50.

 
Intraday Support Levels
S1     102.40-101.60
S2     100.00-99.20
S3     98.30-97.75

Intraday Resistance Levels
R1     104.00-105.10
R2     106.60
R3     107.00-108.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   83.202 Sell
20-DMA   102.66 Buy
50-DMA   92.65 Buy
100-DMA   85.61 Buy
200-DMA   75.08 Buy
STOCH(5,3)   79.108 Sell
MACD(12,26,9)   8.434 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.0975/EUR, high of US$1.1120/EUR and settled the day down by 0.851% to close at US$1.0980/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 Sell

Sell below 1.1050-1.1180, targeting 1.1101-1.0850-1.0720 and 1.0640- 1.0600-1.0520 with stop-loss at daily closing above 1.1200. Buy above 1.0950-1.0520 with risk below 1.0520, targeting 1.1050-1.1105-1.1100-1.1270.

 
Intraday Support Levels
S1     1.0950
S2     1.0720
S3     1.0640-1.0600

Intraday  Resistance Levels
R1     1.1011-1.1050
R2     1.1090
R3     1.1105-1.1180

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.792 Buy
20-DMA   1.1319 Sell
50-DMA   1.1339 Sell
100-DMA   1.1410 Sell
200-DMA   1.1540 Sell
STOCH(5,3)   38.688 Sell
MACD(12,26,9)   0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3079/GBP, high of US$1.3194/GBP and settled the day down by 0.691% to close at US$1.3083/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 1.3070-1.2850 with target 1.3150-1.3200-1.3250 and 1.3290-1.3350-1.3410 with stop loss closing below 1.2900. Sell in between 1.3190-1.3410 with targets at 1.3090-1.3035 and 1.2970-1.2925 with stop loss should be 1.3410.

 
Intraday Support Levels
S1     1.3070
S2     1.3035
S3     1.2970-1.2925

Intraday Resistance Levels
R1     1.3150-¬1.3200
R2     1.3250
R3     1.3290-1.3350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

36.360

Buy
20-DMA   1.3508 Buy
50-DMA   1.3508 Buy
100-DMA   1.3532 Buy
200-DMA   1.3572 Buy
STOCH(5,3)   30.970 Buy
MACD(12,26,9)   -0.002 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY115.57/USD and made an intraday high of JPY116.19/USD and settled the day up 0.319% at JPY116.12/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 114.90-114.50 and 113.90-113.20-112.70. Long positions above 115.50-113.70 with targets of 115.50-116.35-116.90 with stop below 113.70.

 
Intraday Support Levels
S1     116.10-115.50
S2     115.20
S3     114.90-114.50

INTRADAY RESISTANCE LEVELS
R1     116.80-117.50
R2     -118.00
R3    

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.266 Buy
20-DMA   115.18 Sell
50-DMA   114.81 Buy
100-DMA   113.1 Buy
200-DMA   111.59 Buy
STOCH(9,6)   11.683 Sell
MACD(12,26,9)   0.0102 Sell

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