AAFX TRADING

Daily Market Lookup

  • The U.S. dollar edged lower in early European trade Tuesday, moving close to a one-week low, as traders eased expectations that the U.S. Federal Reserve will hike by a full percentage point this month. The dollar has been gradually retreating from its multi-year high as expectations of a super-sized tightening by the Fed at the end of July have been reined in, especially after two of the most hawkish FOMC members – James Bullard and Chris Waller – said that their base case was still a 75 basis point move.EUR/USD edged 0.3% higher to 1.0169 ahead of Thursday’s European Central Bank meeting, where policymakers are expected to begin Europe's hiking cycle with a 25 basis point increase. That said, soaring inflation has some traders looking for a half-point hike, especially if the final Eurozone CPI data, due for release later in the session, is revised above the 8.6% annual increase seen in June. On the flip side, political uncertainty remains rife in Italy, with widely respected Prime Minister Mario Draghi set to address lawmakers on Wednesday, when he’ll declare his intention to either give his fractious coalition another try or quit the government. Additionally, Russia is set to resume supplying gas to Western Europe via the Nord Stream pipe on Thursday after a shutdown for scheduled maintenance. The euro is likely to be pressured if Moscow chooses to prolong the outage for political reasons as the war in Ukraine rages on. Labor market data released early Tuesday showed British workers rejoined the jobs market at the fastest pace since before the pandemic as the cost of living crisis drew more people into employment.
  • The U.S. dollar hovered just above a one-week low on Tuesday as markets reduced the odds of a full percentage-point Federal Reserve rate hike this month. Bets for supersized Fed easing ramped up last week after data showed U.S. inflation, already at a four-decade high, continued to accelerate in June. But some Federal Reserve officials were quick to throw cold water on such talk, and figures from Friday showed an easing of consumer inflation expectations to the lowest in a year. Traders in futures contracts tied to the Fed's short-term federal funds policy rate, who had been leaning toward a full-percentage-point rise in interest rates for the July 26-27 meeting, shifted their bets firmly in favour of a 0.75-percentage-point increase, with the odds last seen at about 81%. Traders are biting their nails ahead of Thursday, when gas is supposed to resume flowing through the Nord Stream pipe from Russia to Germany after a shutdown for scheduled maintenance. Russia's Gazprom (MCX:GAZP) declared force majeure on gas supplies to Europe to at least one major customer, in a letter dated July 14 and seen by Reuters on Monday. Despite the uncertainty, the European Central Bank is poised to raise interest rates on Thursday for the first time in more than a decade. It has telegraphed a 25 basis-point move, but heated inflation has some traders punting for a half-point hike. Elsewhere, the yen hovered near a 24-year low ahead of a Bank of Japan policy decision on Thursday, with the central bank committing repeatedly in recent days to continued ultra-easy settings. Reserve Bank of Australia policy makers see the need for more policy tightening on top of recent hikes, as interest rates are still too low to constrain inflation expectations amid a strong labour market, minutes of its meeting earlier this month showed on Tuesday.
  • Gold was down on Tuesday morning in Asia. It is hovering near an 11-month low as investors gauge the outlook for further monetary policy tightening and the impact on global growth. Investors are keeping an eye on the U.S. Federal Reserve’s meeting due on July 26-27 to get a clue on how aggressive the Fed will be in raising interest rates. Bloomberg Economics said that the latest U.S. data reinforce officials’ support for another 75-basis-point hike.
  • Oil rose slightly on Tuesday, paring earlier losses and after soaring by more than $5 barrel in the previous session, amid concerns about tight supply. Oil prices have been whipsawed between concerns about supply as Western sanctions on Russian crude and fuel supplies over the Ukraine conflict have disrupted trade flows to refiners and end-users and rising worries that central bank efforts to tame surging inflation may trigger a recession that would cut future fuel demand. The underlying supply/demand imbalance is as tight as ever," said Jeffrey Halley, senior market analyst at OANDA, in a note. "Oil prices may have peaked, but they certainly don't look like they're going materially lower from here unless we get a huge surprise from OPEC+." U.S. President Joe Biden visited top oil exporter Saudi Arabia last week, hoping to strike a deal on an oil production boost to tame fuel prices. However, officials from Saudi Arabia, the de facto leader of the Organization of the Petroleum Exporting Countries (OPEC), did not give clear assurances an output increase was secured.
  • Warren Patterson, head of Commodities Strategy at ING, said in a note that the market has had time to digest President Biden's visit with a conclusion that it is unlikely that OPEC and its allies including Russia, known as OPEC+, will increase output more aggressively than planned in the short term. Oil prices were backed by a softer U.S. dollar on Tuesday, which stood around a one-week low level, making greenback-dominated oil slightly cheaper for buyers holding other currencies. The forecast of oil inventories in the U.S., the world's biggest oil consumer, was that crude and distillate supplies may have risen last week while gasoline stockpiles likely fell, according to a preliminary Reuters poll.

 

 
Intraday RESISTANCE LEVELS
19th July 2022 R1 R2 R3
GOLD-XAU 1,720-1,732 1,741 1,750-1,759
Silver-XAG 19.50-19.80 20.45 20.70-21.20
Crude Oil 99.90-101.25 102.00 102.65-104.70
EURO/USD 1.0190-1.0250 1.0290-1.0335 1.0390-1.0430
GBP/USD 1.2010 1.2050 1.2100-1.2200
USD/JPY 138.50-138.90 139.40 140.10- 141.00

Intraday SUPPORTS LEVELS
19th July 2022 S1 S2 S3
GOLD-XAU 1,707 1,700 1,684-1,678
Silver-XAG 18.70-18.40 17.80 17.50-16.90
Crude Oil 98.00-96.90 96.00 94.90-94.00
EURO/USD 1.0150-1.0010 0.9950 0.9860-0.9800
GBP/USD 1.1930-1.1810 1.1760 1.1700-1.1660
USD/JPY 137.90-137.40 137.00 136.30-135.25

Intra-Day Strategy (19th July 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 Monday made its intraday high of US$1716.54/oz and low of US$1699.00/oz. Gold down 0.127% at US$1707.55/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 a2lso 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 1720-1787 keeping stop loss closing above 1787, targeting 1707-1700 and 1684-1678. Buy in between 1709-1670 with risk below 1670, targeting 1750-1759-1779 and 1787-1798.

 
Intraday Support Levels
S1     1,707
S2     1,700
S3     1,684-1,678
Intraday Resistance Levels
R1     1,720-1,732
R2     1,741
R3     1,750-1,759

Technical Indicators

Name   Value Action
14DRSI  

24.622

Buy
20-DMA   1787.96 Sell
50-DMA  

1825.45

Sell
100-DMA   1845.78 Sell
200-DMA   1844.59 Sell
STOCH(5,3)   7.367 Sell
MACD(12,26,9)   -27.400 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$19.01/oz and low of US$18.63/oz settled up by 0.016% at US$18.68/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 19.05-16.90, targeting 19.50-19.80-20.45 and 20.70-21.20- 21.80 with stop loss should be place on the breakage below 19.50. Sell in between 20.45-23.75 with stop loss above 23.75; targeting 19.80-19.50-19.05 and 18.40-17.90.

 
Intraday  Support Levels
S1     18.70-18.40
S2     17.80
S3     17.50-16.90

Intraday  Resistance Levels
R1     19.50-19.80
R2     20.45
R3     20.70-21.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   25.130 Buy
20-DMA   20.72 Sell
50-DMA   21.65 Sell
100-DMA   22.45 Sell
200-DMA   23.13 Sell
STOCH(5,3)   16.615 Buy
MACD(12,26,9)   -0.642 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US99.43/bbl, intraday low of US$92.72/bbl and settled up by 4.423% to close at US$98.68/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 94.65-98.90 with stop loss at 98.90; targeting 94.30-93.20-92.30 and 91.15-90.50. Buy above 93.10-89.00 with risk daily closing below 89.00 and targeting 94.65-96.00-96.90 and 98.00-98.90-99.90

 
Intraday Support Levels
S1     98.00-96.90
S2     96.00
S3     94.90-94.00

Intraday Resistance Levels
R1     99.90-101.25
R2     102.00
R3     102.65-104.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.201 Sell
20-DMA   102.48 Buy
50-DMA   105.58 Buy
100-DMA   102.95 Buy
200-DMA   94.80 Buy
STOCH(5,3)   15.412 Sell
MACD(12,26,9)   -4.213 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.0077/EUR, high of US$1.0201/EUR and settled the day up by 0.624% to close at US$1.0144/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 1.0190-1.0430, targeting 1.0010-0.9950 and 0.9860-0.9800 with stop-loss at daily closing above 1.0430. Buy above 1.0150-0.9800 with risk below 0.9800, targeting 1.0100-1.0200-1.0250 and 1.0290-.0335-1.0390.

 
Intraday Support Levels
S1     1.0150-1.0010
S2     0.9950
S3     0.9860-0.9800

Intraday  Resistance Levels
R1     1.0190-1.0250
R2     1.0290-1.0335
R3     1.0390-1.0430

TECHNICAL INDICATORS
Name   Value Action
14DRSI   25.410 Buy
20-DMA   1.0340 Buy
50-DMA   1.0506 Buy
100-DMA   1.0700 Sell
200-DMA   1.0979 Sell
STOCH(5,3)   12.057 Buy
MACD(12,26,9)   -0.0090 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.1861/GBP, high of US$1.1203/GBP and settled the day up 0.697% to close at US$1.1948/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 1.1930-1.1700 with target 1.2010-1.2050 and 1.2100-1.2200-1.2310 with stop loss closing below 1.1700. Sell in between 1.1930-1.2230 with targets at 1.1850-1.1800 and 1.1760-1.1700 with stop loss should be 1.2630.

 
Intraday Support Levels
S1     1.1930-1.1810
S2     1.1760
S3     1.1700-1.1660

Intraday Resistance Levels
R1     1.2010
R2     1.2050
R3     1.2100-1.2200

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

43.930

Buy
20-DMA   1.2031 Sell
50-DMA   1.2253 Sell
100-DMA   1.2544 Sell
200-DMA   1.2890 Sell
STOCH(5,3)   63.782 Sell
MACD(12,26,9)   -0.008 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY137.88/USD and made an intraday high of JPY138.56/USD and settled the day down by 0.26% at JPY138.13/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 138.50-141.50 with risk above 141.50 targeting 138.00-137.38-136.50 and 135.20-134.60-134.00. Long positions above 137.50-130.60 with targets of 139.00-139.40-140.10 and 141.00-141.50 with stop below 124.30.

 
Intraday Support Levels
S1     137.90-137.40
S2     137.00
S3     136.30-135.25

INTRADAY RESISTANCE LEVELS
R1     138.50-138.90
R2     139.40
R3     140.10- 141.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.771 Buy
20-DMA   136.42 Buy
50-DMA   133.46 Buy
100-DMA   129.18 Buy
200-DMA   123.59 Buy
STOCH(9,6)   60.033 Buy
MACD(12,26,9)   1.389 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING