AAFX TRADING

Daily Market Lookup

  • The U.S. dollar slipped slightly on Friday, as investors remained cautious of the impact of tighter central bank policies around the world aimed at curbing soaring inflation. The dollar is moving lower from that elevated level due to concerns that such aggressive monetary tightening may end up sparking a recession. Fed Chair Jerome Powell warned in a testimony on Capitol Hill earlier this week that while it does not intend to cause a wider slowdown, "it's certainly a possibility" despite his confidence that the U.S. economy will be able to withstand a sharp rise in borrowing costs. On Thursday, Powell added that the Fed has an "unconditional" commitment to fighting inflation. U.K. retail sales volumes declined by 0.5% in May, but were above analyst estimates. Elsewhere, EUR/USD rose 0.19% to $1.05 ahead of statements from European Central Bank speakers later today and business confidence data in Germany. USD/JPY was down 0.11% to trade at ¥134.79 after Japanese inflation came in above the Bank of Japan's 2% target, casting some doubt on the bank's loose monetary policy stance.
  • The U.S. dollar slipped against its major peers on Friday, on course for its first weekly decline this month as investors continue to assess the path for Federal Reserve policy and whether aggressive rate hikes would trigger a recession. The safe-haven currency also lost support amid improved market sentiment, which saw regional stock markets rise and buoyed riskier currencies like the Australian and New Zealand dollars. The dollar index, which measures the greenback against six rivals, sank 0.2% to 104.19 in Asia. That undid the previous day's 0.19% rise, which was driven mostly by a decline in the euro after weak European factory data reduced bets for European Central Bank tightening. Dollar trading has been choppy this week, with markets now betting on more cautious policy action from the Fed after another expected 75 basis point rate increase in July. The dollar index has dropped 0.42% over the period. Fed Governor Michelle Bowman said on Thursday that she supports 50 basis point hikes for "the next few" meetings after July's. Meanwhile, Fed Chair Jerome Powell, in his second day of Congressional testimony, stressed the central bank's "unconditional" commitment to taming inflation, even amid risks to growth. Recession fears tamed Treasury yields overnight, suppressing a key support for the dollar, with that on the 10-year note sliding to a two-week low. Germany also triggered the "alarm stage" of its emergency gas plan on Thursday in response to falling Russian supplies.
  • Gold was down on Friday morning in Asia, set for its second straight decline, with worries of big interest rate hikes from the U.S. Federal Reserve weighing on bullion demand. Fed Chair Jerome Powell reiterated that the central bank’s inflation fight is "unconditional" on Thursday, while Fed Governor Michelle Bowman said she supports another 75-basis points interest rate hike in July, followed by a few more half-point hikes. “The U.S. dollar remains firm, and expectations now lean towards a 75-basis-points Fed hike in July. The TIPS spread – a market-based proxy for inflation expectations – is also near a 4-month low, and these have kept a lid on any gold rally,” City Index senior market analyst Matt Simpson told Reuters. “Gold looks vulnerable over the near-term, given its inability to break $1,850, its 200-day average, this week,” Simpson said, adding “were it not for the fear of a global recession then gold would likely be lower than it already is.”
  • Oil was down on Friday morning in Asia as fears of slower demand from slowing U.S. economic growth and supply concerns weighed on the market. Crude futures entered into sell mode following disappointing U.S. manufacturing and services purchasing managers indexes (PMI), along with a downswing in Germany’s manufacturing data, SPI Asset Management managing partner Stephen Innes told Reuters. The Organization of the Petroleum Exporting Countries and allies (OPEC+) producers including Russia will likely stick to a plan to increase output by 648,000 barrels a day in August, which is hoping to bring down crude prices as U.S. President Joe Biden plans to visit Saudi Arabia, according to Reuters However, the block has struggled to meet the monthly increase targets because of lacking investment in oil fields by some OPEC members and losses in Russian output. Wednesday’s U.S. crude supply data from the American Petroleum Institute showed a build of 5.607 million barrels for the week ended June 17. The U.S. Energy Information Administration’s weekly oil data will be delayed until at least next week due to systems issues. OPEC and allied producing countries, including Russia, will most likely stick to a plan for accelerated output increases in August in hopes of easing crude prices and inflation as U.S. President Joe Biden plans to visit Saudi Arabia, sources said. The group known as OPEC+ agreed at its last meeting on June 2 to boost output by 648,000 barrels a day in July, or 7% of global demand, and by the same amount in August, up from the initial plan to add 432,000 barrels per day a month over three months until September. However, the group has struggled to hit the monthly increase targets due to underinvestment in oilfields by some OPEC members and, more recently, losses in Russian output.

 

 
Intraday RESISTANCE LEVELS
24th June 2022 R1 R2 R3
GOLD-XAU 1,840-1,851 1,859 1,870-1,879
Silver-XAG 21.80-22.05 22.45 23.05-23.55
Crude Oil 105.50-107.00 108.00 109.75-110.50
EURO/USD 1.0550-1.0630 1.0690 1.0770-1.0840
GBP/USD 1.2310-1.2390 1.2450 1.2490-1.2550
USD/JPY 135.20-136.00 137.00 137.90 138.50

Intraday SUPPORTS LEVELS
24th June 2022 S1 S2 S3
GOLD-XAU 1,820-1,807 1,798 1,787-1,775
Silver-XAG 21.20-20.90 20.45 20.10-19.50
Crude Oil 103.30-101.00 100.20 99.00-97.10
EURO/USD 1.0460-1.0410 1.0390 1.0330-1.0290
GBP/USD 1.2200-1.2150 1.2100 1.2050-1.2010
USD/JPY 134.60-133.50 132.90 132.00-131.10

Intra-Day Strategy (24th 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 Thursday made its intraday high of US$1845.97/oz and low of US$1822.33/oz. Gold down 0.824% at US$1822.44/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 1840-1900 keeping stop loss closing above 1900, targeting 1831-1820 and 1801-1787. Buy in between 1820-1786 with risk below 1786, targeting 1840-1851-1859-1870 and 1879-1890.

 
Intraday Support Levels
S1     1,820-1,807
S2     1,798
S3     1,787-1,775
Intraday Resistance Levels
R1     1,840-1,851
R2     1,859
R3     1,870-1,879

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 Thursday made its intraday high of US$21.50/oz and low of US$20.91/oz settled down by 2.18% at US$20.94/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 21.20-19.60, targeting 21.80-22.05-22.50 and 23.05-23.95-24.55 with stop loss should be place on the breakage below 19.50. Sell in between 22.05-23.75 with stop loss above 23.75; targeting 21.30-21.05-20.60 and 20.00-19.60.

 
Intraday  Support Levels
S1     21.20-20.90
S2     20.45
S3     20.10-19.50

Intraday  Resistance Levels
R1     21.80-22.05
R2     22.45
R3     23.05-23.55

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 Thursday made an intra‐day high of US106.40/bbl, intraday low of US$101.77/bbl and settled down by 0.773% to close at US$103.27/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 105.50-109.75 with stop loss at 109.75; targeting 103.30-101.00-100.20 and 99.00-97.10. Buy above 103.30-97.00 with risk daily closing below 97.00 and targeting 105.50-107.00-108.00 and 109.75-110.50-113.00.

 
Intraday Support Levels
S1     103.30-101.00
S2     100.20
S3     99.00-97.10

Intraday Resistance Levels
R1     105.50-107.00
R2     108.00
R3     109.75-110.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.820 Sell
20-DMA   113.45 Buy
50-DMA   109.63 Buy
100-DMA   103.28 Buy
200-DMA   93.29 Buy
STOCH(5,3)   20.305 Sell
MACD(12,26,9)   2.097 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.0482/EUR, high of US$1.0580/EUR and settled the day down by 0.467% to close at US$1.0515/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 1.0550-1.0795, targeting 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 1.0550-1.0630-1.0690 and 1.0770-1.0840.

 
Intraday Support Levels
S1     1.0460-1.0410
S2     1.0390
S3     1.0330-1.0290

Intraday  Resistance Levels
R1     1.0550-1.0630
R2     1.0690
R3     1.0770-1.0840

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 Wednesday made an intra‐day low of US$1.2160/GBP, high of US$1.2314/GBP and settled the day up by 0.0326% to close at US$1.2260/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 1.2200-1.2010 with target 1.2310-1.2420 and 1.2490-1.2575-1.2650 with stop loss closing below 1.2010. Sell in between 1.2310-1.2630 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     1.2200-1.2150
S2     1.2100
S3     1.2050-1.2010

Intraday Resistance Levels
R1     1.2310-1.2390
R2     1.2450
R3     1.2490-1.2550

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

43.373

Buy
20-DMA   1.2388 Sell
50-DMA   1.2570 Sell
100-DMA   1.2820 Sell
200-DMA   1.3096 Sell
STOCH(5,3)   58.703 Sell
MACD(12,26,9)   -0. Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY134.25/USD and made an intraday high of JPY136.21/USD and settled the day down 0.908% at JPY134.94/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 135.20-139.70 with risk above 139.70 targeting 134.00 and 133.50-132.90-132.00. Long positions above 135.20-130.60 with targets of 135.20-136.00-137.00 and 137.90-138.50 with stop below 124.30.

 
Intraday Support Levels
S1     134.60-133.50
S2     132.90
S3     132.00-131.10

INTRADAY RESISTANCE LEVELS
R1     135.20-136.00
R2     137.00
R3     137.90 138.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.382 Buy
20-DMA   133.30 Buy
50-DMA   130.16 Buy
100-DMA   126.11 Buy
200-DMA   121.15 Buy
STOCH(9,6)   64.035 Buy
MACD(12,26,9)   1.1710 Sell

AAFX TRADING
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