AAFX TRADING

Daily Market Lookup

  • The dollar was headed for a fifth winning week against major peers on Friday, ahead of a closely watched U.S. jobs report that is likely to back the case for aggressive monetary policy tightening. The U.S. currency was up for a ninth week against the yen, as benchmark U.S. Treasury yields resumed their climb - topping 3.1% overnight - following a blip lower immediately after the Federal Reserve raised interest rates by half a percentage point mid-week, placing the U.S. monetary authority at the vanguard of hawkish global central banks. Economists predict a solid 391,000 U.S. jobs were added last month, according to a Reuters poll. The dollar initially dropped back sharply on Wednesday, as Fed Chair Jerome Powell said following the rate hike that a 75 basis point increase is not under active consideration. Sterling was flat at $1.2357, off 1.76% for the week. It tumbled 2.22% overnight, the most in two years, after the Bank of England warned of the risk of recession as it raised interest rates by half a percentage point. On Friday, the RBA drastically revised up forecasts for inflation, foreshadowing how far interest rates might have to rise to bring the country's cost of living crisis under control.
  • The dollar was up on Friday morning in Asia, set for a fifth winning week ahead of the latest U.S. jobs report that will likely set the stage for further aggressive monetary policy tightening. The U.S. jobs report, which includes non-farm payrolls, will be released later in the day. The dollar initially dropped sharply that day, after Fed Chairman Jerome Powell said that a 75-basis point hike is not under active consideration. However, it clawed back those losses a day later, which suggests that the retreat had more to do with positioning than any change in views, according to analysts at National Australia Bank (NAB). Elsewhere in Europe, the pound was set for a 1.81% loss for the week. It fell 2.22% overnight, the most in two years after the Bank of England warned of the risk of recession and hiked its interest rate to 1% as it handed down its policy decision on Thursday.
  • Gold was up on Thursday morning in Asia but is on track for a third consecutive weekly loss. The U.S. dollar and Treasury yields both rallied over the U.S. Federal Reserve’s hawkish stance, and investors are now awaiting the latest U.S. jobs report. The dollar, which normally moves inversely to gold, inched down on Friday but was headed for a fifth winning week. Benchmark U.S. Treasury yields resumed a climb after hitting their highest level since November 2018 in the previous session. Investors now await the latest U.S. jobs report, including non-farm payrolls, which is due later in the day. The Fed on Wednesday hiked its interest rate to 1%, and the Bank of England followed by raising its interest rate to 1% a day later. In equities, Asian shares fell as investors are concerned that rising interest rates could hurt global economic growth.
  • Oil prices climbed for a third straight session on Friday, shrugging off concerns about global economic growth as worries about tightening supplies underpinned prices ahead of an impending European Union embargo on Russian oil. Brent and WTI are on track to rise for a second week in a row, buoyed by the EU's proposal to phase out supplies of Russian crude oil in six months and refined products by the end of 2022. It would also ban all shipping and insurance services for transporting Russian oil. The plan still requires unanimous backing from the 27 countries in the bloc. Wall Street stocks tumbled on Thursday as investors worried that aggressive central bank policies around the world aimed at tamping down inflation could shackle growth. The Bank of England warned Thursday that Britain risks a double-whammy of a recession and inflation above 10% as it raised interest rates to their highest since 2009, hiking by quarter of a percentage point to 1%. On supply, the Organization of the Petroleum Exporting Countries, Russia and allied producers, known as OPEC+, agreed as expected to another modest monthly increase in oil output. Ignoring calls from Western nations to hike output more, OPEC+ agreed to raise June production by 432,000 barrels per day, in line with its plan to unwind curbs made when the pandemic hammered demand. Investors are also eyeing higher demand from the United States this fall as Washington unveiled plans to buy 60 million barrels of crude for its emergency stockpiles. A U.S. Senate panel advanced a bill that could expose OPEC+to lawsuits for collusion on boosting oil prices. Congress hasfailed to pass versions of the legislation for more than twodecades, but lawmakers are worried about rising inflation andhigh gasoline prices.

 

 
Intraday RESISTANCE LEVELS
6th May 2022 R1 R2 R3
GOLD-XAU 1,900-1,914 1,923-1,938 1.950-1,958
Silver-XAG 22.50-23.05 23.20 23.60-23.95
Crude Oil 109.40-110.80 111.85 113.20-114.70
EURO/USD 1.0610-1.0690 1.0765 1.0820-1.0900
GBP/USD 1.2360-1.2420 1.2490-1.2545 1.2605-1.2690
USD/JPY 130.60-131.20 132.00 132.90-133.50

Intraday SUPPORTS LEVELS
6th May 2022 S1 S2 S3
GOLD-XAU 1,874-1,868 1,857 1,848-1,834
Silver-XAG 22.05-21.70 21.40 21.05-20.60
Crude Oil 107.20-106.40 104.50-103.90 102.95-102.10
EURO/USD 1.0550-1.0490 1.0450 1.0390-1.3050
GBP/USD 1.2300-1.2240 1.2200 1.2150-1.2070
USD/JPY 129.60-129.00 127.50 127.00-126.40

Intra-Day Strategy (6th May 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$1909.67/oz and low of US$1872.37/oz. Gold down 0.242% at US$1876.97/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 1889-1874-1868 and 1857-1849-1834. Buy in between 1874-1834 with risk below 1834, targeting 1911-1923 and 1938-1958-1970.

 
Intraday Support Levels
S1     1,874-1,868
S2     1,857
S3     1,848-1,834
Intraday Resistance Levels
R1     1,900-1,914
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 Thursday made its intraday high of US$23.27/oz and low of US$22.30/oz settled down by 2.074% at US$22.51/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 22.80-21.00, targeting 23.20--23.95 and 24.55-25.10-25.70 with stop loss should be place on the breakage below 21.00. Sell in between 23.20-24.90 with stop loss above 24.90; targeting 22.50-22.05-21.70 and 21.40-21.05.

 
Intraday  Support Levels
S1     22.05-21.70
S2     21.40
S3     21.05-20.60

Intraday  Resistance Levels
R1     22.50-23.05
R2     23.20
R3     23.60-23.95

TECHNICAL INDICATORS
Name   Value Action
14DRSI   27.633 Buy
20-DMA   23.80 Sell
50-DMA   24.20 Sell
100-DMA   24.13 Sell
200-DMA   24.13 Sell
STOCH(5,3)   50.135 Buy
MACD(12,26,9)   0.108 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US110.29/bbl, intraday low of US$105.45/bbl and settled up by 0.934% to close at US$107.52/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 107.20-113.20 with stop loss at 113.20; targeting 106.40-104.50-103.90 and 102.95-102.10-101.00. Buy above 106.40-101.00 with risk daily closing below 101.00 and targeting 107.20-109.40-110.80 and 111.85-113.20.

 
Intraday Support Levels
S1     107.20-106.40
S2     104.50-103.90
S3     102.95-102.10

Intraday Resistance Levels
R1     109.40-110.80
R2     111.85
R3     113.20-114.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.276 Sell
20-DMA   103.67 Buy
50-DMA   100.98 Buy
100-DMA   95.22 Buy
200-DMA   86.36 Buy
STOCH(5,3)   79.206 Buy
MACD(12,26,9)   1.220 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.0491/EUR, high of US$1.0641/EUR and settled the day down by 0.718% to close at US$1.0537/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     1.0390-1.3050

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   36.857 Buy
20-DMA   1.0696 Sell
50-DMA   1.0875 Sell
100-DMA   1.1056 Sell
200-DMA   1.1278 Sell
STOCH(5,3)   58.688 Buy
MACD(12,26,9)   -0.011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2324/GBP, high of US$1.2633/GBP and settled the day down by 2.12% to close at US$1.2356/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 20DMA (1.2834) is become immediate resistance level. 14-D RSI is currently in oversold 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 1.2300-1.2070 with target 1.2360-1.2420-1.2490 and 1.2605-1.2690-1.2750 with stop loss closing below 1.2500. Sell in between 1.2360-1.2690 with targets at 1.2300-1.2240-1.2200 and 1.2150-1.2070 with stop loss should be 1.2690.

 
Intraday Support Levels
S1     1.2300-1.2240
S2     1.2200
S3     1.2150-1.2070

Intraday Resistance Levels
R1     1.2360-1.2420
R2     1.2490-1.2545
R3     1.2605-1.2690

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

33.674

Buy
20-DMA   1.2755 Sell
50-DMA   1.2985 Sell
100-DMA   1.3174 Sell
200-DMA   1.3347 Sell
STOCH(5,3)   62.970 Buy
MACD(12,26,9)   -0.002 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY128.74/USD and made an intraday high of JPY130.54/USD and settled the day up 0.798% at JPY130.07/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     129.60-129.00
S2     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   65.875 Buy
20-DMA   127.65 Buy
50-DMA   123.87 Buy
100-DMA   120.34 Buy
200-DMA   116.74 Buy
STOCH(9,6)   52.683 Buy
MACD(12,26,9)   0.0102 Sell

AAFX TRADING
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