AAFX TRADING

Daily Market Lookup

  • The U.S. dollar soared in early European trade Thursday, climbing through a key psychological level versus the Japanese yen as the Bank of Japan maintained its very accommodative monetary policy stance. This follows the Bank of Japan adding to its recent round of bond purchases, offering to buy an unlimited amount of 10-year government bonds, in a bid to keep a lid on benchmark yields. The Japanese central bank also kept its interest rate steady at -0.10%, suggesting it is no closer to tightening its monetary policy as it continues to support its domestic economy. This is in direct contrast to the stance of the U.S. Federal Reserve, which has already begun tightening policy, and is widely expected to lift interest rates at least 50 basis points next week. There had been some speculation the Bank of Japan might react to the weakness in its currency, but the central bank essentially doubled down on its low-yield policy. The Fed’s next two-day policy meeting starts Tuesday, but the release later Thursday of U.S. GDP data could also impact market sentiment. The market is expecting growth of 1.1% in the first quarter, a slowdown from the 6.9% growth seen during the previous quarter, but the risk is to the downside after the U.S. trade deficit hit a record high and implied a large drag from net exports. This follows the decision of Russia to halt gas flows to Poland and Bulgaria from Wednesday amid a standoff over fuel payments, raising fears about Europe’s energy security. This move is likely to make the European Central Bank reluctant to tighten aggressively, leaving the single currency vulnerable given how much further down the tightening cycle the Fed is. USD/CNY rose 0.7% to 6.604, weighed by the spreading of its Covid outbreak to Beijing, the nation’s capital, while AUD/USD rose 0.22% to 0.7142 with the Australian currency retaining strength after the previous session's strong inflation release pointed to interest rate hikes even amid concerns a slowdown in China will reduce demand for its natural resources.
  • Gold prices fell to a 10-week low on Thursday, as an elevated U.S. dollar hurt demand for greenback-priced bullion, while an impending Federal Reserve interest rate hike also dented the metal's appeal as an inflation hedge. Gold has been holding very well above $1,900, but has seen pressure from the dollar, and the underlying factor of the U.S. Federal Reserve being expected to raise interest rates by 50 basis points next week, said Brian Lan, managing director at dealer GoldSilver Central. A stronger dollar makes greenback-priced gold less attractive for other currency holders. Benchmark 10-year U.S. Treasury yields also firmed as investors awaited further clarity on the "restrictive" policy the Fed plans to pursue next week to combat inflation by curbing economic growth. Gold is highly sensitive to rising U.S. short-term interest rates and higher yields, which increase the opportunity cost of holding non-yielding bullion. However, gold is also seen as a safe store of value during economic and political crises. With gold prices failing to push higher despite a backdrop of the Ukraine war and rapid inflation, investors have probably decided to look elsewhere, Lan said, adding that lockdowns in China to combat the spread of COVID-19 have impacted demand from the top consumer.
  • Oil prices dropped on Thursday on caution about dwindling fuel demand in China, the world's biggest oil importer, due to the economic impact of COVID-19 restrictions. Both contracts had settled over 30 cents higher on Wednesday on worries about tight worldwide oil supplies and another drawdown in U.S. distillate and gasoline stocks. The U.S. Energy Information Administration said crude stocks rose by just 692,000 barrels last week, short of expectations, but distillate inventories, which include diesel and jet fuel, fell to their lowest since May 2008. In China, Beijing closed some public spaces and stepped up COVID-19 checks at others on Thursday, as most of the city's 22 million residents embarked on more mass testing aimed at averting a Shanghai-like lockdown, which has disrupted factories and supply chains raising concerns about the outlook for the country's economic growth. Despite the oil demand concerns about China, Asia's biggest oil refiner, Sinopec (NYSE:SHI) Corp, expects the country's demand for refined oil products to recover in the second quarter as COVID-19 outbreaks are gradually controlled. Analysts also said that a slowdown in global growth due to higher commodity prices and an escalation in the Russia-Ukraine conflict could further exacerbate worries on oil demand. Investors are trying to balance supply and demand concerns over Russian oil-and-gas disruption, and a worsening global economic outlook, said Ajay Kedia, director at energy consultancy Kedia Advisory.The global economy will expand more slowly than predicted three months ago, according to Reuters polls of over 500 economists. Median forecasts for global growth collected in this month's Reuters polls on more than 45 economies were chopped to 3.5% this year and 3.4% for 2023 from 4.3% and 3.6% in a January poll. That compares to an International Monetary Fund prediction of 3.6% growth in both years. Meanwhile in Japan, another major crude oil buyer, the central bank on Thursday maintained its massive stimulus programme and a pledge to keep interest rates ultra-low, to support a fragile economy even as sharp rises in raw material costs push up inflation.

 

 
Intraday RESISTANCE LEVELS
28th April 2022 R1 R2 R3
GOLD-XAU 1,890-1,900 1,923-1,938 1.950-1,958
Silver-XAG 23.20-23.60 23.95 24.55-24.90
Crude Oil 102.10-102.95 103.90 104.50-106.40
EURO/USD 1.0610-1.0690 1.0765 1.0820-1.0900
GBP/USD 1.2605-1.2690 1.2750-1.2790 1.2840-1.2900
USD/JPY 130.60-131.20 132.00 132.90-133.50

Intraday SUPPORTS LEVELS
28th April 2022 S1 S2 S3
GOLD-XAU 1,874-1,868 1,857 1,848-1,834
Silver-XAG 23.05-22.85 22.50 22.05-21.70
Crude Oil 101.00-99.25 98.50-97.00 96.10-95.00
EURO/USD 1.0550-1.0490 1.0450 1.0390
GBP/USD 1.2545-1.2490 1.2420 1.2360-1.2300
USD/JPY 130.00-129.60 129.00-127.50 127.00-126.40

Intra-Day Strategy (28th April 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 Wednesday made its intraday high of US$1906.98/oz and low of US$1881.30/oz. Gold down 1.027% at US$1885.81/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 1890-1970 keeping stop loss closing above 1970, targeting 1874-1868 and 1857-1849-1834. Buy in between 1874-1834 with risk below 1834, targeting 1890-1908-1923 and 1938-1958-1970.

 
Intraday Support Levels
S1     1,874-1,868
S2     1,857
S3     1,848-1,834
Intraday Resistance Levels
R1     1,890-1,900
R2     1,923-1,938
R3     1.950-1,958

Technical Indicators

Name   Value Action
14DRSI  

42.603

Buy
20-DMA   1944.89 Buy
50-DMA  

1925.10

Buy
100-DMA   1890.99 Buy
200-DMA   1856.28 Buy
STOCH(5,3)   10.014 Sell
MACD(12,26,9)   3.180 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$23.68/oz and low of US$23.23/oz settled down by 0.863% at US$23.29/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 23.05-21.70, targeting 23.20-23.60-23.95 and 24.55-25.10-25.70 with stop loss should be place on the breakage below 21.70. Sell in between 23.20-24.90 with stop loss above 24.90; targeting 23.05-22.85 and 22.50-22.05.

 
Intraday  Support Levels
S1     23.05-22.85
S2     22.50
S3     22.05-21.70

Intraday  Resistance Levels
R1     23.20-23.60
R2     23.95
R3     24.55-24.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.420 Buy
20-DMA   24.86 Sell
50-DMA   24.67 Buy
100-DMA   24.33 Buy
200-DMA   24.22 Buy
STOCH(5,3)   6.135 Sell
MACD(12,26,9)   0.082 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US102.45/bbl, intraday low of US$99.36/bbl and settled up by 0.137% to close at US$101.50/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 99.25-102.95 with stop loss at 102.95; targeting 97.00-96.10-95.00 and 93.40-92.40. Buy above 98.00-92.40 with risk daily closing below 92.40 and targeting 99.25-100.60-101.0 and 102.10-102.95.

 
Intraday Support Levels
S1     101.00-99.25
S2     98.50-97.00
S3     96.10-95.00

Intraday Resistance Levels
R1     102.10-102.95
R2     103.90
R3     104.50-106.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.716 Sell
20-DMA   102.33 Sell
50-DMA   99.51 Buy
100-DMA   92.32 Buy
200-DMA   84.53 Buy
STOCH(5,3)   34.206 Sell
MACD(12,26,9)   0.401 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.0513/EUR, high of US$1.0654/EUR and settled the day down by 0.783% to close at US$1.0553/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.1191), 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 1.0610-1.1145, targeting 1.0765-1.0720-1.0640 and 1.0600-1.0550 with stop-loss at daily closing above 1.1200. Buy above 1.0550-1.0450 with risk below 1.0450, targeting 1.0765-1.0820-1.0870 and 1.0900-1.0950-1.1105.

 
Intraday Support Levels
S1     1.0550-1.0490
S2     1.0450
S3     1.0390

Intraday  Resistance Levels
R1     1.0610-1.0690
R2     1.0765
R3     1.0820-1.0900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   32.509 Buy
20-DMA   1.0869 Sell
50-DMA   1.0995 Sell
100-DMA   1.1143 Sell
200-DMA   1.1338 Sell
STOCH(5,3)   21.688 Sell
MACD(12,26,9)   -0.007 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.2501/GBP, high of US$1.2601/GBP and settled the day down by 0.276% to close at US$1.2537/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 1.2545-1.2300 with target 1.2605-1.2690-1.2750 and 1.2790-1.2840-1.2900 with stop loss closing below 1.2500. Sell in between 1.2605-1.2900 with targets at 1.2545-1.2490-1.2420 and 1.2360-1.2300 with stop loss should be 1.3300.

 
Intraday Support Levels
S1     1.2545-1.2490
S2     1.2420
S3     1.2360-1.2300

Intraday Resistance Levels
R1     1.2605-1.2690
R2     1.2750-1.2790
R3     1.2840-1.2900

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

38.488

Buy
20-DMA   1.3084 Sell
50-DMA   1.3197 Sell
100-DMA   1.3316 Sell
200-DMA   1.3435 Sell
STOCH(5,3)   29.970 Sell
MACD(12,26,9)   -0.002 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY126.93/USD and made an intraday high of JPY128.58/USD and settled the day up 0.945% at JPY128.41/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 130.60-132.50 with risk above 132.50 targeting 130.00-129.60-129.00 and 128.10-127.00-126.40. Long positions above 130.00-126.40 with targets of 130.60-131.20-132.00 and 132.90-133.50 with stop below 126.40.

 
Intraday Support Levels
S1     130.00-129.60
S2     129.00-127.50
S3     127.00-126.40

INTRADAY RESISTANCE LEVELS
R1     130.60-131.20
R2     132.00
R3     132.90-133.50

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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