AAFX TRADING

Daily Market Lookup

  • The dollar clung on in choppy trade on Wednesday, after its biggest surge for weeks as Federal The U.S. dollar was up against the yen on Wednesday after data showed a surprise pickup in the U.S. services industry in July, while hawkish comments from Federal Reserve officials this week also supported the greenback. The Institute for Supply Management said its non-manufacturing PMI rebounded last month from June. The increase ended with three straight monthly declines. It also showed supply bottlenecks and price pressures eased, and backed up the view that the economy is not in a recession. Fed officials voiced their determination again on Wednesday to rein in high inflation, although one noted a half-percentage-point hike in the U.S. central bank's key interest rate next month might be enough to march toward that goal. The greenback rallied on Tuesday after a trio of Fed officials signaled that the central bank remains "completely united" on increasing rates to a level that will put a dent in the highest U.S. inflation since the 1980s. U.S. monthly jobs data due on Friday will also help set the tone for the greenback, analysts said. Friction after the highest-level U.S. visit to Taiwan in 25 years also may help support the U.S. dollar, analysts said. China condemned House of Representatives Speaker Nancy Pelosi's visit and began six days of military drills surrounding Taiwan. Pelosi left Taiwan on Wednesday after pledging American solidarity during her brief visit.
  • The dollar held onto recent gains on Thursday, helped by several U.S. Federal Reserve officials pushing back against suggestions they will slow the pace of interest rate hikes, while the pound was flat ahead of a Bank of England policy decision. The BOE is expected to raise rates by an aggressive 50 basis points (bps) to 1.75%, the highest level since late 2008, but sterling was little changed in Asia trade ahead of the decision, due at 1100 GMT, at $1.2148. The BoE has never raised the Bank Rate by a half point since it was made independent in 1997. San Francisco Fed President Mary Daly and Minneapolis Fed President Neel Kashkari overnight voiced their determination to rein in high inflation, reiterating similar messages from other officials the day before. A Reuters poll of analysts earlier this week found 70% that ought the dollar was yet to peak in this cycle, even after the dollar index hit a two-decade peak in July.
  • Gold prices edged higher on Thursday, with most other precious metals marking small gains after a rally in the U.S. dollar appeared to have paused. Gains in precious metal prices came as the U.S. dollar cooled after a two-day rally. The dollar index surged nearly 1% in the past two days after hawkish comments from two Federal Reserve members drove up expectations of sharper interest rate hikes this year. San Francisco Fed President Mary Daly and Chicago Fed President Charles Evans both signaled that inflation is yet to cool in the country, and the Fed was likely to raise rates even further to combat rising prices. A potential escalation in U.S.-China tensions had also driven haven demand for the greenback. While gold appears to have gained some ground in the past two weeks, the outlook for the yellow metal is dulled by the prospect of rising interest rates this year. Most other precious metals are also expected to see muted price action as the Federal Reserve continues to tighten monetary policy. Copper prices dropped sharply this week following a swathe of weak manufacturing PMIs from across the globe. This trend of weakening factory data is expected to weigh on industrial metals in the coming months.
  • Oil prices inched higher in early trade on Thursday, recouping some losses from the prior session after a surprise rise in U.S. inventories and a mild supply hike by the OPEC+ drove prices to an over five-month low. Prices had slumped as much as 3.4% on Wednesday after government data confirmed that U.S. crude stockpiles unexpectedly rose by over 4 million barrels last week. The rise was largely telegraphed by data from the American Petroleum Institute on Tuesday. The rise in inventories confirms a recurring theme seen in recent months- that crude demand is on the lam this year. Weak manufacturing PMIs from China, Europe, and the United States had also slammed oil prices earlier in the week The Organization of Petroleum Exporting Countries and its allies agreed to raise supply by 100,000 barrels per day on Wednesday, following U.S. pressure for a hike. But the hike- which is about 0.1% of global demand, is the lowest ever production increase bythe organization and is widely expected to be inconsequential for prices. After surging to multi-year highs during supply shocks caused by the Russia-Ukraine war, oil prices have since consolidated sharply in the face of waning demand. With major world economies on the cusp of a recession, the trend is likely to continue for the remainder of 2022. But a drop in oil prices is also expected to eventually help bring down runaway inflation. Fuel prices have been among the biggest contributors to rising inflation this year. Oil prices rose on Thursday as supply concerns triggered a rebound from multi-month lows plumbed in the previous session after U.S. data signaled weak fuel demand. Both benchmarks fell to their weakest levels since February in the previous session after U.S. data showed crude and gasoline stockpiles unexpectedly surged last week and as OPEC+ agreed to raise its oil output target by 100,000 barrels per day (bpd), equal to about 0.1% of global oil demand. The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as OPEC+, have been previouslyBPDcreasing production but have struggled to meet targets as most members have already exhausted their output potential. While the United States has asked the group to boost output, spare capacity is limited and Saudi Arabia may be reluctant to beef up production at the expense of Russia, hit by sanctions over the Ukraine invasion that Moscow calls "a special operation". Ahead of the meeting, OPEC+ had trimmed its forecast for the oil market surplus this year by 200,000 barrels per day (bpd) to 800,000 bpd, three delegates told Reuters.

 

 
Intraday RESISTANCE LEVELS
4th August 2022 R1 R2 R3
GOLD-XAU 1,774-1,785 1,798 1,809-1,818
Silver-XAG 20.35-20.70 21.45 21.57-22.50
Crude Oil 90.50-91.30 92.35 94.00-94.90
EURO/USD 1.0290-1.0335 1.0390 1.0430-1.0470
GBP/USD 1.2245-1.2300 1.2405 1.2479-1.2550
USD/JPY 134.10-135.20 136.00 136.75-137.40

Intraday SUPPORTS LEVELS
4th August 2022 S1 S2 S3
GOLD-XAU 1,760-1,746 1,741 1,732-1,707
Silver-XAG 19.80-19.50 18.90 18.60-17.80
Crude Oil 89.00-88.30 87.00 86.40-85.50
EURO/USD 1.0150 1.0010 0.9950-0.9900
GBP/USD 1.2150-1.2100 1.2010-1.1930 1.1870-1.1810
USD/JPY 133.10-132.50 131.90 130.70-130.24

Intra-Day Strategy (4th August 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 Wednesday made its intraday high of US$1772.68/oz and low of US$1754.19/oz. Gold is down by 0.257% at US$1765.41/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 the 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 1774-1818 keeping stop loss closing above 1818, targeting 1760-1746-1741 and 1732-1707-1700. Buy in between 1760-1707 with risk below 1707, targeting 1774-1785-1798 and 1809-1818.

 
Intraday Support Levels
S1     1,760-1,746
S2     1,741
S3     1,732-1,707
Intraday Resistance Levels
R1     1,774-1,785
R2     1,798
R3     1,809-1,818

Technical Indicators

Name   Value Action
14DRSI  

33.708

Buy
20-DMA   1746.30 Sell
50-DMA  

1794.58

Sell
100-DMA   1826.12 Sell
200-DMA   1834.0 Sell
STOCH(5,3)   7.367 Sell
MACD(12,26,9)   -27.400 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$20.16/oz and low of US$19.77/oz settled down by 0.516% at US$20.04/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (26.62), breakage above will lead to 27.60. MACD is below the zero line and histograms are decreasing trend and it will bring a bearish stance in the upcoming sessions. RSI is approaching the neutral region, indicating a buy signal for now. The Stochastic Oscillator is in the oversold region and gives a positive crossover to show an upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 19.80-16.90, targeting 20.45-20.70-21.45 and 21.60-22.50 with stop loss should be placed on the breakage below 16.90. Sell in between 20.35-23.75 with stop loss above 23.75; targeting 18.90-18.40-17.90 and 17.50-16.90-16.40.

 
Intraday  Support Levels
S1     19.80-19.50
S2     18.90
S3     18.60-17.80

Intraday  Resistance Levels
R1     20.35-20.70
R2     21.45
R3     21.57-22.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.865 Buy
20-DMA   19.54 Buy
50-DMA   20.35 Sell
100-DMA   21.41 Sell
200-DMA   22.44 Sell
STOCH(5,3)   92.797 Sell
MACD(12,26,9)   -0.131 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$95.84/bbl, an intraday low of US$89.84/bbl, and settled down by 3.00% to close at US$90.37/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 the zero line and histograms are in increasing mode will bring a bullish stance in the upcoming sessions. The Stochastic Oscillator is in the neutral region and gives a positive crossover for confirmation of a bullish stance; while the RSI is in the 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 94.00-98.00 with stop loss at 98.00; targeting 92.30-91.30-90.50 and 89.00-88.30. Buy above 92.30-88.30 with risk daily closing below 88.30 and targeting 94.00-94.90-96.00 and 96.90-98.00-98.90.

 
Intraday Support Levels
S1     89.00-88.30
S2     87.00
S3     86.40-85.50

Intraday Resistance Levels
R1     90.50-91.30
R2     92.35
R3     94.00-94.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.197 Sell
20-DMA   98.88 Buy
50-DMA   102.69 Buy
100-DMA   101.85 Buy
200-DMA   94.99 Buy
STOCH(5,3)   67.76 Sell
MACD(12,26,9)   -3.175 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.0122/EUR, a high of US$1.0210/EUR, and settled the day down by 0.0108% to close at US$1.0163/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0736), which become immediate support, a break below will target 1.0647. MACD is above the zero line and histograms are increasing mode which will bring a bullish view. Stochastic is in overbought territory and giving positive crossovers to signal for the bullish outlook for intraday. 14D RSI is currently in a neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Sell

Sell below 1.0290-1.0430, targeting 1.0190-1.0010 and 0.9950-0.9860 with stop-loss at daily closing above 1.0430. Buy above 1.0190-0.9800 with risk bel.9800, targeting 1.0290-1.0335-1.0390 and 1.0430-1.0470.

 
Intraday Support Levels
S1     1.0150
S2     1.0010
S3     0.9950-0.9900

Intraday  Resistance Levels
R1     1.0290-1.0335
R2     1.0390
R3     1.0430-1.0470

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.764 Buy
20-DMA   1.0228 Buy
50-DMA   1.0361 Sell
100-DMA   1.0565 Sell
200-DMA   1.0868 Sell
STOCH(5,3)   83.589 Buy
MACD(12,26,9)   -0.0041 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.2099/GBP, a high of US$1.2207/GBP, and settled the day down 0.178% to close at US$1.2142/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 20DMA (1.2834) is becoming a resistance level. 14-D RSI is currently in an oversold region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in overbought territory and gives a positive crossover to confirm bullish a stance. MACD is above zero line but histograms are increasing leading movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy in between 1.1290-1.1700 with a target of 1.2245-1.2310 and 1.2405-1.2479 with stop loss closing below 1.1700. Sell in between 1.2245-1.2550 with targets at 1.2190-1.2100-1.2010 and 1.1930-1.1870-1.1810 with stop loss should be 1.2630.

 
Intraday Support Levels
S1     1.2150-1.2100
S2     1.2010-1.1930
S3     1.1870-1.1810

Intraday Resistance Levels
R1     1.2245-1.2300
R2     1.2405
R3     1.2479-1.2550

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

60.310

Buy
20-DMA   1.2091 Buy
50-DMA   1.2206 Buy
100-DMA   1.2464 Sell
200-DMA   1.2815 Sell
STOCH(5,3)   80.940 Sell
MACD(12,26,9)   -0.0006 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made an intra‐day low of JPY132.28/USD and made an intraday high of JPY134.54/USD and settled the day down by 1.218% at JPY133.84/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 the overbought region and chances of downward are expected based on RSI. MACD is above the 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 a bearish stance.

Trading Strategy: Neutral to Sell

Sell below 131.50-134.50 with risk above 134.50 targeting 130.70-130.25-129.35 and 128.00-126.75. Long positions above 130.20-126.75 with targets of 131.50-131.90-133.10 and 134.10-135.25-136.30 with stop below 130.20.

 
Intraday Support Levels
S1     133.10-132.50
S2     131.90
S3     130.70-130.24

INTRADAY RESISTANCE LEVELS
R1     134.10-135.20
R2     136.00
R3     136.75-137.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.600 Buy
20-DMA   135.21 Sell
50-DMA   133.93 Sell
100-DMA   130.24 Sell
200-DMA   124.68 Buy
STOCH(9,6)   6.551 Buy
MACD(12,26,9)   0.538 Sell

AAFX TRADING
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