AAFX TRADING

Daily Market Lookup

  • The dollar was up on Monday morning in Asia as Friday’s red hot inflation data suggested more aggressive monetary tightening from the U.S. Federal Reserve. The yen rallied briefly late on Friday when Japan’s government and the central bank said that they were concerned about the yen’s recent sharp falls. The rare statement could be seen as a signal that Tokyo could intervene to support the currency. The Bank of Japan (BOJ) will hand it down on Friday while investors expect little change from the BOJ Beijing announced on Sunday three rounds of mass testing as it saw new COVID-19 outbreaks, adding to investors’ concerns about a grim economic outlook. The Bank of England will hand down its policy decision on Thursday. It is expected to hike interest rates. The U.S. consumer price index released Friday rose 8.6% in May year-on-year, a fresh 40-year high, adding to investors’ concerns about a recession caused by aggressive monetary tightening. The inflation data also sent the benchmark U.S. 10-year yield higher, touching 3.2% on Monday morning, having gained nearly 12 basis points on Friday. The Fed will hold its June meeting Wednesday, where it is expected to deliver half-point interest rate hikes. On the data front, the U.S. producer price index (PPI) is due on Tuesday, and China's key economic activity data including industrial production is due the day following.
  • The U.S. dollar soared in early European trade Monday, especially against the Japanese yen, as red-hot U.S. inflation data lifted Treasury yields at the start of a busy week for central banks. This follows Friday’s U.S. consumer price index for May rising to a new four-decade high of 8.6% on the year. This has raised the chances that the Federal Reserve will need to extend its series of 50bp rate hikes well into the third quarter and even potentially opening the door to a larger 75bp move at Wednesday’s policy-setting meeting. The benchmark U.S. 10-year yield touched 3.2% early on Monday, having gained nearly 12 basis points on Friday, while the Bank of Japan confirmed earlier Monday it would buy Japanese government bonds on Tuesday as part of its policy to keep benchmark 10-year yields close to its 0% target. The BoJ meets on Friday and its move to buy JGBs on Tuesday suggest that it is very likely to stick to its ultra-easy monetary policy stance. Elsewhere, EUR/USD fell 0.3% to 1.0486, continuing the weakness it suffered after Thursday’s European Central Bank meeting when the central bank confirmed it will end its long-running bond-buying scheme at the start of next month and start interest rates in July GBP/USD fell 0.4% to 1.2263, with sterling taking little support from expectations the Bank of England will raise rates once more on Thursday, after the U.K. economy slowed again in April, as industrial and manufacturing output slumped for a second straight month. Gross domestic product fell 0.3% in April, much weaker than the 0.1% growth expected, while for the three months through April it grew only 0.2% after 0.8% in the previous three-month period.
  • Gold was down on Monday morning in Asia over strengthening U.S. dollars as Friday's high U.S. inflation data suggested more aggressive monetary tightening. U.S. inflation data Friday showed that the U.S. consumer price index released Friday rose 8.6% in May year-on-year, a fresh 40-year high, adding to investors’ concerns about a recession caused by tightening monetary policies from the U.S. Federal Reserve. The Fed’s June meeting will be held on Wednesday, where the central bank is expected to deliver its second straight half-point interest rate hike to cool inflation Adding to investors' concerns about an economic downturn, Beijing announced on Sunday three rounds of mass testing as it saw new COVID-19 outbreaks. For moves of other central banks, the Bank of England will hand down its policy decision on Thursday, while the Bank of Japan follows on Friday.
  • Oil prices dropped more than $2 on Monday as a flare-up in COVID-19 cases in Beijing dashed hopes for a rapid pick-up in China's fuel demand, while worries about global inflation and sluggish economic growth further depressed the market. Prices fell after Chinese officials warned on the weekend of a "ferocious" spread of COVID-19 in the capital, where mass testing is planned until Wednesday. That was despite the potential for lockdown noise in coming weeks, Innes added, with demand still far from reflecting normal conditions. Both global oil benchmarks rose more than 1% last week after data showed robust oil demand in the world's top consumer, the United States, despite inflation concerns. Their rise was aided by hopes for a consumption rebound in second-biggest global consumer China after lockdown measures were lifted from June 1 Concerns about further interest rate hikes after Friday's red-hot U.S. inflation data are also weighing on global financial markets. The U.S. consumer price index increased a bigger-than-expected 8.6% last month, in its largest annual increase since December 1981, official figures showed, dashing hopes that inflation had peaked. Oil producers and refiners are running at full throttle to meet peak summer demand, while traders are watching closely for any possible impact from labour disputes in Libya, Norway and South Korea on oil exports and consumption. To boost supplies in the West, top exporter Saudi Arabia plans to divert some crude to Europe from China in July, traders said.

 

 
Intraday RESISTANCE LEVELS
13th June 2022 R1 R2 R3
GOLD-XAU 1,870-1,879 1,890 1,896-1,908
Silver-XAG 22.50-22.90 23.20 23.75-24.25
Crude Oil 117.10-118.20 119.00-120.10 121.00-122.00
EURO/USD 1.0490-1.0550 1.0630-1.0690 1.0755-1.0795
GBP/USD 1.2200-1.2310 1.2420-1.2490 1.2575-1.2630
USD/JPY 134.60-135.20 136.00 136.40-137.00

Intraday SUPPORTS LEVELS
13th June 2022 S1 S2 S3
GOLD-XAU 1,859-1,851 1,840-1,831 1,820-1,808
Silver-XAG 21.50 20.90 20.60-20.00
Crude Oil 115.80-114.40 113.00 111.50-109.02
EURO/USD 1.0460-1.0390 1.0330 1.0290-1.0250
GBP/USD 1.2190-1.2150 1.2100 1.2075-1.2050
USD/JPY 134.00-133.50 132.90-132.00 131.20-130.60

Intra-Day Strategy (13th 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 Friday made its intraday high of US$1875.85/oz and low of US$1825.01/oz. Gold up 1.271% at US$1871.38/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 1870-1907 keeping stop loss closing above 1907, targeting 1860-1851-1842 and 1827-1820-1801. Buy in between 1860-1790 with risk below 1790, targeting 1870-1879 and 1890-1900-1907.

 
Intraday Support Levels
S1     1,859-1,851
S2     1,840-1,831
S3     1,820-1,808
Intraday Resistance Levels
R1     1,870-1,879
R2     1,890
R3     1,896-1,908

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 Friday made its intraday high of US$21.98/oz and low of US$21.26/oz settled up by 0.880% at US$21.88/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     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   23.32 Sell
STOCH(5,3)   71.135 Buy
MACD(12,26,9)   0.272 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US120.51/bbl, intraday low of US$116.16/bbl and settled down by 1.979% to close at US$118.16/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 117.30-125.10 with stop loss at 125.10; targeting 115.80-114.50-113.25. Buy above 119.00-114.50 with risk daily closing below 114.50 and targeting 120.10-121.00-122.00 and 123.90-125.00.

 
Intraday Support Levels
S1     115.80-114.40
S2     113.00
S3     111.50-109.02

Intraday Resistance Levels
R1     117.10-118.20
R2     119.00-120.10
R3     121.00-122.00

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 Friday made an intraday low of US$1.0505/EUR, high of US$1.0641/EUR and settled the day up by 0.923% to close at US$1.0517/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 1.0490-1.0795, targeting 1.0460-1.0390-1.0330 and 1.0290-1.0250 with stop-loss at daily closing above 1.0795. Buy above 1.0460-1.0250 with risk below 1.0210, targeting 1.0490-1.0550-1.0630 and 1.0690-1.0741-1.0795.

 
Intraday Support Levels
S1     1.0460-1.0390
S2     1.0330
S3     1.0290-1.0250

Intraday  Resistance Levels
R1     1.0490-1.0550
R2     1.0630-1.0690
R3     1.0755-1.0795

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.443 Buy
20-DMA   1.0662 Buy
50-DMA   1.0720 Buy
100-DMA   1.0881 Sell
200-DMA   1.1127 Sell
STOCH(5,3)   22.051 Buy
MACD(12,26,9)   -0.0058 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2300/GBP, high of US$1.2517/GBP and settled the day down by 1.415% to close at US$1.2314/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 1.2190-1.2010 with target 1.2200-1.2310-1.2420 and 1.2490-1.2575-1.2650 with stop loss closing below 1.2010. Sell in between 1.2200-1.2630 with targets at 1.2190-1.2150-1.2100 and 1.2075-1.2050 with stop loss should be 1.2630.

 
Intraday Support Levels
S1     1.2190-1.2150
S2     1.2100
S3     1.2075-1.2050

Intraday Resistance Levels
R1     1.2200-1.2310
R2     1.2420-1.2490
R3     1.2575-1.2630

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 Friday made intra‐day low of JPY133.35/USD and made an intraday high of JPY134.47/USD and settled the day up 0.067% at JPY134.41/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 134.60-137.00 with risk above 137.00 targeting 134.00-133.50-132.90 and 132.00-131.20-130.60. Long positions above 134.00-130.60 with targets of 134.60-135.20-136.00 and 136.40-137.00 with stop below 124.30.

 
Intraday Support Levels
S1     134.00-133.50
S2     132.90-132.00
S3     131.20-130.60

INTRADAY RESISTANCE LEVELS
R1     134.60-135.20
R2     136.00
R3     136.40-137.00

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

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