AAFX TRADING

Daily Market Lookup

  • The U.S. dollar edged higher in early European trade Friday, attempting to recoup some of the previous session’s hefty losses ahead of the release of the widely-watched monthly U.S. employment report. Friday’s main focus will be the July U.S. jobs report, which will provide clues of how the U.S. economy is faring. Economists expect nonfarm payrolls to have increased by 250,000 last month, a slowing in growth from the 372,000 jobs in June. That would mark the 19th straight month of payrolls expansion but would be the smallest increase in that span. Data released on Thursday showed the number of Americans filing new claims for unemployment benefits increased last week, suggesting some softening in the labor market, and the jobs report will be studied carefully for potential confirmation. The cooling in job growth could ease pressure on the Fed to deliver a third straight interest rate increase of 75 basis points at its next meeting in September. That said, a number of high-profile Fed officials have taken a hawkish tone in recent days, indicating that the central bank is still firmly focused on taming inflation and further interest rate hikes are coming. The Bank of England raised borrowing costs by 50 basis points on Thursday, to 1.75%, its highest level since late 2008, as it attempts to subdue inflation running at a 40-year high. The bank also warned about a long recession ahead in Britain.
  • The dollar crept higher on Friday but struggled to recoup its losses after falling by its sharpest pace in two weeks, as investors remained on tenterhooks ahead of U.S. jobs data and amid growing worries about a recession. Investors await the key U.S. nonfarm payrolls report due at 1230 GMT, which will provide hints of how the U.S. economy is faring. Economists expect an increase of 250,000 jobs for the month of July, after 372,000 were added in June. However, signs of softening in the labour market could already be underway, as overnight data showed that the number of Americans filing new claims for unemployment benefits increased last week. Against the weaker greenback, the euro held steady at around $1.0237, after surging 0.8% overnight. But the euro's reprieve from recent losses is likely short-lived as concerns about an energy crisis remain. A stand-off over the return of a turbine that Russia says is holding back gas supplies to Europe showed no sign of being resolved on Thursday, as Moscow said it needed documentation to confirm the equipment was not subject to sanctions. On Thursday, the BoE raised its benchmark rate by half a percentage-point to 1.75%, the highest since late 2008, but warned about a long recession ahead in Britain.
  • Gold prices extended gains on Friday and were set to end the week higher amid growing jitters over slowing global growth, while losses in the dollar ahead of U.S. nonfarm payrolls data also helped metals. Most industrial metal prices also rose as losses in the dollar eased some pressure. But they are broadly set to end the week lower after a swathe of weak manufacturing data. Both price indicators were set to end the week up 1.5%, as a growing number of dismal economic indicators from across the globe deepened concerns over a coming recession. Demand for safe havens in Asia was also bolstered by an escalation in tensions between China and Taiwan, after Beijing fired missiles around the island as part of a “military drill.” The move was in retaliation for U.S. House of Representative Speaker Nancy Pelosi's visit to Taiwan this week, which was opposed by China. But the US Dollar Index tumbled 0.8% on Thursday, and was muted on Friday as volatility kicked in ahead of key U.S. nonfarm payrolls data, due later in the day. Investors will watch the reading closely, given that it factors into the Federal Reserve’s plans to hike interest rates further. A stronger-than-expected reading could signal resilience in the jobs market, giving the Fed more room to raise rates. Among industrial metals, Copper Futures rose 0.6% on Friday, boosted largely by a falling dollar. But the red metal is set to end the week nearly 3% lower, after weak manufacturing data from China and the Eurozone painted a dismal picture for demand this year.
  • Oil prices rose on Friday, bouncing off their lowest levels since February in the previous session, as supply shortage concerns were enough to cancel out fears of slackening fuel demand. Oil prices have come under pressure this week as the market fretted over the impact of inflation on economic growth and demand, but signs of tight supply kept a floor under prices. For September, OPEC+ is set to raise its oil output goal by 100,000 barrels per day. The hike is one of the smallest since OPEC quotas were introduced in 1982, OPEC data shows. The global crude oil markets remained firmly in backwardation, where prompt prices are higher than those in future months, indicating tight supplies Supply concerns are expected to ratchet up closer to winter with the European Union sanctions banning seaborne imports of Russian crude and oil products set to take effect on Dec. 5. For now, signs of an economic slowdown capped price recovery. Recession worries have intensified following the Bank of England's warning of a drawn-out downturn after it raised interest rates by the most since 1995. Investors are focused on the U.S. employment report to be released later in the day, which is expected to show nonfarm payrolls increased by 250,000 jobs last month, after rising by 372,000 jobs in June. Any signs of strength in the labour market could feed into fears of aggressive steps by the U.S. Federal Reserve to curb inflation.

 

 
Intraday RESISTANCE LEVELS
5th August 2022 R1 R2 R3
GOLD-XAU 1,798-1,809 1,818 1,827-1,835
Silver-XAG 20.35-20.70 21.45 21.57-22.50
Crude Oil 89.00-90.50 91.30 92.35-94.00
EURO/USD 1.0290-1.0335 1.0430-1.0470 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
5th August 2022 S1 S2 S3
GOLD-XAU 1,785–1,774 1,760 1,746-1,741
Silver-XAG 19.80-19.50 18.90 18.60-17.80
Crude Oil 88.30-87.00 86.40 85.50-84.90
EURO/USD 1.0190-1.0150 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 (5th 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 Thursday made its intraday high of US$1794.90/oz and low of US$1763.23/oz. Gold is up by 1.463% at US$1791.18/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 1798-1835 keeping stop loss closing above 1835, targeting 1785-1774-1760-1746 and 1741-1732-1707. Buy in between 1774-1707 with risk below 1707, targeting 1774-1785-1798 and 1809-1818.

 
Intraday Support Levels
S1     1,785–1,774
S2     1,760
S3     1,746-1,741
Intraday Resistance Levels
R1     1,798-1,809
R2     1,818
R3     1,827-1,835

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 Friday made its intraday high of US$20.38/oz and low of US$19.95/oz settled down by 0.598% at US$20.17/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 Thursday made an intra‐day high of US$91.25/bbl, an intraday low of US$86.97/bbl, and settled down by 3.677% to close at US$87.10/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 89.00-98.00 with stop loss at 98.00; targeting 88.30-87.00-86.40 and 85.50-84.90. Buy above 88.30-84.90 with risk daily closing below 84.90 and targeting 89.00-90.50-91.30 and 92.35-94.00-94.90-96.00.

 
Intraday Support Levels
S1     88.30-87.00
S2     86.40
S3     85.50-84.90

Intraday Resistance Levels
R1     89.00-90.50
R2     91.30
R3     92.35-94.00

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 Thursday made an intraday low of US$1.0153/EUR, a high of US$1.0253/EUR, and settled the day up by 0.799% to close at US$1.0244/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 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     1.0190-1.0150
S2     1.0010
S3     0.9950-0.9900

Intraday  Resistance Levels
R1     1.0290-1.0335
R2     1.0430-1.0470
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 Thursday made an intra‐day low of US$1.2065/GBP, a high of US$1.2220/GBP, and settled the day down 0.119% to close at US$1.2156/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 Thursday made an intra‐day low of JPY132.75/USD and made an intraday high of JPY134.42/USD and settled the day down by 0.721% at JPY132.87/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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