AAFX TRADING

Daily Market Lookup

  • The dollar was up on Wednesday morning in Asia as central banks globally are expected to brace for tightening policies to tame inflation. The yen continued its loss after sliding to a 20-year low as the Bank of Japan (BOJ) has given no indication of giving up ultra-easy monetary policies. However, Japan’s economy seems to rebound. Government data released earlier in the day showed that Japan’s gross domestic product (GDP) shrank 0.5% in January-March year-on-year, smaller than the initial reading of the 1.0% drop released last month. The European Central Bank (ECB) will meet on Thursday and hand down its policy decision which is widely expected to lay the groundwork for more interest rate hikes. U.S. Treasury Secretary Janet Yellen said on Tuesday that she expected inflation to remain high, and the Biden administration is likely to increase the 4.7% inflation forecast for this year in its budget proposal. The global economic outlook remained grim. The World Bank reduced its estimate for global growth this year to 2.9% from a January prediction of 4.1% due to soaring commodity prices, supply disruptions, and moves by central banks to hike interest rates. Investors are now looking to Friday’s U.S. consumer price index (CPI) for more clues on the interest rate hike path from the U.S. Federal Reserve.
  • The yen hit a fresh 20-year low versus the dollar on Wednesday and slipped to a seven-year trough against the euro as traders awaited a European Central Bank meeting likely to leave Japan alone among its peers in sticking to ultra easy monetary policy. The ECB meets on Thursday and markets are expecting it to at least lay the groundwork for rapid rate rises, if not begin them with a small hike. The U.S. Federal Reserve is expected to raise its benchmark funds rate by 50 basis points next week and again in July, but Bank of Japan (BOJ) officials have given no indication of easing accommodative settings. The yen has accordingly lost more than 4.5% from 127.09 per dollar to touch 133.22 in eight sessions, dropping hard on crosses as investors see soaring consumer prices forcing central banks around the world to crimp demand with rapid rate hikes. It is down 10 sessions in a row on the euro, its longest losing streak in eight months, and found a seven-year low of 142.36 early in Asia trade. The BOJ allows the benchmark 10 year bond yield to move up to 0.25 percentage points from its 0% target.
  • Gold was down on Wednesday morning in Asia as investors awaited the U.S. consumer price index (CPI) for more clues on the interest rate hikes. U.S. Treasury Secretary Janet Yellen said on Tuesday that inflation might remain high, and the Biden administration is likely to increase the 4.7% inflation forecast for this year in its budget proposal. Gold-related transactions involving Russia may be sanctioned, and any efforts to circumvent U.S. sanctions using gold are closely monitored, Yellen said. Monetary policies are still on investors' radars. They now await Friday’s U.S. CPI data for clues on the interest rate hike path. The World Bank slashed its forecast for global growth this year to 2.9% from a January prediction of 4.1%, as concerns of inflation, supply disruptions, and higher interest rates persist. In Asia-Pacific, Japan’s first-quarter economy beat expectations with the country's gross domestic product (GDP) shrinking 0.5% in January-March year-on-year, smaller than the preliminary reading of the 1.0% drop released last month.
  • Oil prices drifted higher on Wednesday, anticipating a report of low U.S. oil stocks, while expectations of solid demand in the upcoming driving season also lent support. Analysts polled by Reuters expect data for last week to show another drawdown of U.S. crude inventories, although gasoline and distillates stocks could edge higher. However, figures from the American Petroleum Institute showed that U.S. crude and oil products inventories rose last week. The U.S. Energy Information Administration (EIA) will report last week's stock levels at 10:30 a.m. EDT (1430 GMT) on Wednesday. The World Bank on Tuesday slashed its global growth forecast for 2022 by nearly a third, warning that Russia's invasion of Ukraine had compounded damage from the COVID-19 pandemic, and that many countries now faced recession. Meanwhile, global crude and oil products supplies remain tight, boosting Asian refiners' diesel margins to record levels, as Western sanctions hamper exports from major producer Russia. The CEO of global commodities trader Trafigura said oil prices could soon hit $150 a barrel and go higher this year, with demand destruction likely by the end of the year. Most refineries globally are already running close to capacity to meet rising demand from pandemic recovery and to replace lost Russian supplies. JP Morgan analysts estimate that Russia has cut about 500,000 to 700,000 barrels per day of oil products exports, because it now finds marketing fuel harder than marketing crude. On Tuesday, China topped up its first batch of product export quotas aimed at reducing high domestic inventories, which have risen as pandemic lockdowns have dented demand. Despite the latest additions to the quotas, their volumes remain much lower than last year, however.

 

 
Intraday RESISTANCE LEVELS
8th June 2022 R1 R2 R3
GOLD-XAU 1,851-1,859 1,870 1,879-1,890
Silver-XAG 22.50-22.90 23.20 23.75-24.25
Crude Oil 118.20-119.00 120.10 121.00-122.10
EURO/USD 1.0755-1.0795 1.0920 1.0970-1.1005
GBP/USD 1.2575-1.2630 1.2690-1.2745 1.2800-1.2975
USD/JPY 132.90-133.50 134.00 134.60-135.00

Intraday SUPPORTS LEVELS
8th June 2022 S1 S2 S3
GOLD-XAU 1,840-1,831 1,820 1,808-1,800
Silver-XAG 22.05-21.50 20.90 20.60-20.00
Crude Oil 117.10-115.80 114.50 113.25-111.60
EURO/USD 1.0690-1.0630 1.0550 1.0490-1.0450
GBP/USD 1.2490-1.2420 1.2310 1.2200-1.2150
USD/JPY 132.00-131.20 130.60-129.60 128.90-127.50

Intra-Day Strategy (8th June 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 Tuesday made its intraday high of US$1855.41/oz and low of US$1836.83/oz. Gold up 0.594% at US$1852.21/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 1851-1907 keeping stop loss closing above 1907, targeting 1851-1842-1827 and 1820-1801-1789. Buy in between 1841-1790 with risk below 1790, targeting 1840-1851-1870-1879 and 1890-1900-1907.

 
Intraday Support Levels
S1     1,840-1,831
S2     1,820
S3     1,808-1,800
Intraday Resistance Levels
R1     1,851-1,859
R2     1,870
R3     1,879-1,890

Technical Indicators

Name   Value Action
14DRSI  

46.024

Buy
20-DMA   1857.00 Buy
50-DMA  

1878.02

Buy
100-DMA   1875.88 Buy
200-DMA   1855.89 Buy
STOCH(5,3)   47.831 Sell
MACD(12,26,9)   -11.400 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$22.27/oz and low of US$21.85/oz settled up by 0.0180% at US$22.22/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 21.60-19.60, targeting 22.05-22.50 and 23.05--23.95-24.55-25.10 with stop loss should be place on the breakage below 19.50. Sell in between 22.10-23.75 with stop loss above 23.75; targeting 21.50-21.05-20.60 and 20.00-19.60.

 
Intraday  Support Levels
S1     22.05-21.50
S2     20.90
S3     20.60-20.00

Intraday  Resistance Levels
R1     22.50-22.90
R2     23.20
R3     23.75-24.25

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.588 Buy
20-DMA   22.12 Sell
50-DMA   22.83 Sell
100-DMA   23.32 Sell
200-DMA   23.68 Sell
STOCH(5,3)   71.135 Buy
MACD(12,26,9)   0.272 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US118.67/bbl, intraday low of US$115.62/bbl and settled up by 0.600% to close at US$118.09/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 118.20-122.10 with stop loss at 122.10; targeting 114.50-113.25-111.60 and 110.10-107.60-105.90. Buy above 117.10-109.90 with risk daily closing below 109.00 and targeting 105.80-117.10-118.20 and 119.00-120.10.

 
Intraday Support Levels
S1     117.10-115.80
S2     114.50
S3     113.25-111.60

Intraday Resistance Levels
R1     118.20-119.00
R2     120.10
R3     121.00-122.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   61.122 Sell
20-DMA   110.83 Buy
50-DMA   106.36 Buy
100-DMA   100.19 Buy
200-DMA   90.659 Buy
STOCH(5,3)   60.915 Sell
MACD(12,26,9)   1.807 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.0651/EUR, high of US$1.0714/EUR and settled the day down by 0.0850% to close at US$1.0682/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0736), which become immediate support, break below will target 1.0647. 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 1.0750-1.0970, targeting 1.0690-1.0630-1.0550 and 1.0490-1.0450-1.0390 with stop-loss at daily closing above 1.1100. Buy above 1.0690-1.0210 with risk below 1.0210, targeting 1.0741-1.0795 and 1.0920-1.0970-1.1005.

 
Intraday Support Levels
S1     1.0690-1.0630
S2     1.0550
S3     1.0490-1.0450

Intraday  Resistance Levels
R1     1.0755-1.0795
R2     1.0920
R3     1.0970-1.1005

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.943 Buy
20-DMA   1.0647 Buy
50-DMA   1.0736 Buy
100-DMA   1.0916 Sell
200-DMA   1.1165 Sell
STOCH(5,3)   84.051 Buy
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2429/GBP, high of US$1.2598/GBP and settled the day up by 0.473% to close at US$1.2588/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 1.2490-1.2010 with target 1.2575-1.2650-1.2745 and 1.2800-1.2975 with stop loss closing below 1.2010. Sell in between 1.2575-1.2975 with targets at 1.2490-1.2420 and 1.2310-1.2200-1.2150 with stop loss should be 1.2975.

 
Intraday Support Levels
S1     1.2490-1.2420
S2     1.2310
S3     1.2200-1.2150

Intraday Resistance Levels
R1     1.2575-1.2630
R2     1.2690-1.2745
R3     1.2800-1.2975

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

52.981

Buy
20-DMA   1.2523 Sell
50-DMA   1.2722 Sell
100-DMA   1.2967 Sell
200-DMA   1.3208 Sell
STOCH(5,3)   80.970 Sell
MACD(12,26,9)   -0.004 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY131.84/USD and made an intraday high of JPY133.00/USD and settled the day up 0.522% at JPY132.53/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 130.60-133.50 with risk above 133.50 targeting 129.60-128.90-127.50 and 126.90-126.10-125.00. Long positions above 129.60-124.30 with targets of 130.60-131.20-132.00 and 132.90-133.50 with stop below 124.30.

 
Intraday Support Levels
S1     132.00-131.20
S2     130.60-129.60
S3     128.90-127.50

INTRADAY RESISTANCE LEVELS
R1     132.90-133.50
R2     134.00
R3     134.60-135.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   Buy
20-DMA   128.49 Buy
50-DMA   126.58 Buy
100-DMA   122.76 Buy
200-DMA   119.00 Buy
STOCH(9,6)   92.683 Buy
MACD(12,26,9)   0.0102 Sell

AAFX TRADING
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