AAFX TRADING

Daily Market Lookup

  • The U.S. dollar edged higher in early European trade Tuesday, remaining near a one-week high as global recession fears prompted demand for the safe haven currency. Fears of a global slowdown are mounting. The People’s Bank of China unexpectedly cut interest rates on Monday after the release of weak industrial production and retail sales data indicated that the world’s second-largest economy struggled to shake off the hit to growth from its strict COVID restrictions. Europe is facing soaring energy bills this year, which are set to weigh heavily on growth as the year progresses, while New York state factory activity fell in August to the lowest since near the start of the COVID-19 pandemic, a further sign that the world's largest economy is slowing. Yet the Federal Reserve looks likely to continue its aggressive monetary tightening when it next meets in September. The Fed officials who have spoken since the July meeting have all pushed back against any perception that they’d be pivoting away from tightening any time soon. This brings the minutes from the July Fed meeting, due on Wednesday, firmly into focus as it will probably offer clues as to what would push the central bank to go big with tightening yet again in September. GBP/USD fell 0.2% to 1.2027 after Britain's labor market showed more signs of cooling with the number of people in employment growing by 160,000 in the April-June period, a lot less than expected, while the number of job vacancies fell for the first time since mid-2020.
  • The dollar was little changed against a basket of currencies on Tuesday as investors waited on U.S. retail sales and minutes from the Federal Reserve's July meeting on Wednesday. The greenback has bounced from a six-week low last week as investors ramp up bets that the U.S. central bank will continue to hike rates aggressively as inflation remains persistently high. Trading has been choppy, however, with the Fed not due to meet until Sept. 20-21 and with more consumer price inflation and jobs data due before then. Looser financial conditions as benchmark 10-year Treasury yields hold below 3% and as the credit and stocks markets improve has increased speculation the Fed may need to be more aggressive in tightening conditions to address rising price pressures. Investors will scour minutes from the Fed’s July meeting on Wednesday for any new signals of how large a rate hike is likely in September. Fed funds futures traders are currently pricing in a 60% chance of a 50 basis points increase and a 40% probability of a 75 basis points hike. U.S. retail sales data on Wednesday will also offer new insight into the state of the consumer. It is expected to show that sales rose by 0.1% in July compared with June. Data on Tuesday showed that U.S. homebuilding fell to the lowest level in nearly 1-1/2 years in July, weighed down by higher mortgage rates and prices for construction materials. Industrial production, meanwhile, rose to an all-time high in July. The euro climbed back into positive territory, after dropping earlier on data showing that German investor sentiment fell slightly in August on concerns the rising cost of living will hit private consumption. Europe is struggling with an energy crisis after imposing sanctions on Russia due to its invasion of Ukraine Germany secured a commitment on Tuesday from major gas importers to keep two floating liquefied natural gas (LNG) terminals fully supplied from this winter in a bid to cut reliance on Russian fuel, as Moscow warned that sky-high gas prices may jump again. The Japanese currency, which is often affected by the difference between benchmark yields in the United States and Japan, rallied last week on expectations that cooler U.S. inflation would mean a less aggressive pace of Fed tightening and so lower U.S. yields. However in recent days, several Fed policymakers have spoken of the need for continued rate hikes.
  • Oil prices rose over $1 on Wednesday, rebounding from six-month lows hit the previous day, as an unexpectedly large drop in U.S. oil and gasoline stocks reminded investors that demand remains firm, if overshadowed by the prospect of a global recession. The contracts slumped about 3% on Tuesday as weak U.S. housing starts data spurred concerns about a potential global recession. U.S. crude and fuel stocks fell in the latest week, according to market sources citing American Petroleum Institute figures on Tuesday. Crude stocks declined by about 448,000 barrels for the week ended Aug. 12. Gasoline inventories fell by about 4.5 million barrels, while distillate stocks were down by about 759,000 barrels, according to the sources. An extended Reuters poll showed on Tuesday that crude inventories probably dropped by around 300,000 barrels last week and gasoline stockpiles likely fell 1.1 million barrels, while distillate inventories rose. Oil supply could rise if talks to revive the Iran's 2015 nuclear deal with world powers are successful, which would remove sanctions on Iranian oil exports, analysts said. The European Union and United States said on Tuesday they were studying Iran's response to what the EU has called its "final" proposal to save the deal after Tehran called on Washington to show flexibility. The EU will stop buying all Russian crude oil delivered by sea from early December and ban all Russian refined products two months later as part of sanctions imposed over Moscow's invasion of Ukraine. Russia calls its actions there "a special operation"

 

 
Intraday RESISTANCE LEVELS
17th August 2022 R1 R2 R3
GOLD-XAU 1,785-1,792 1,798-1,809 1,818-1,827
Silver-XAG 20.70-21.00 21.45 21.57-22.50
Crude Oil 88.20-89.00 90.50-91.30 90.50-91.30
EURO/USD 1.0190-1.0290 1.0335 1.0390-1.0430
GBP/USD 1.2110 1.2150-1.2245 1.2300-1.2355
USD/JPY 135.20-136.00 137.00 137.90-138.50

Intraday SUPPORTS LEVELS
17th August 2022 S1 S2 S3
GOLD-XAU 1,774-1,760 1,746 1,741-1,732
Silver-XAG 20.00-19.80 19.50-18.90 18.60-17.80
Crude Oil 86.80-86.10 84.90 83.7-83.00
EURO/USD 1.0150-1.0090 1.0030 0.9995-0.9950
GBP/USD 1.2060-1.2010 1.1930-1.1890 1.1805-1.1760
USD/JPY 134.10-133.00 132.50 131.90-130.75

Intra-Day Strategy (17th 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 Tuesday made its intraday high of US$1783.02/oz and low of US$1771.34/oz. Gold is down by 0.228% at US$1775.32/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 1790-1835 keeping stop loss closing above 1835, targeting 1774-1760-1746 and 1741-1732-1707. Buy in between 1771-1707 with risk below 1707, targeting 1785-1798 and 1809-1818.

 
Intraday Support Levels
S1     1,774-1,760
S2     1,746
S3     1,741-1,732
Intraday Resistance Levels
R1     1,785-1,792
R2     1,798-1,809
R3     1,818-1,827

Technical Indicators

Name   Value Action
14DRSI  

57.516

Buy
20-DMA   1765.17 Sell
50-DMA  

1783.73

Sell
100-DMA   1812.42 Sell
200-DMA   1826.05 Sell
STOCH(5,3)   80.749 Sell
MACD(12,26,9)   -27.400 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$20.30/oz and low of US19.90/oz settled down by 0.646% at US$20.12/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     20.00-19.80
S2     19.50-18.90
S3     18.60-17.80

Intraday  Resistance Levels
R1     20.70-21.00
R2     21.45
R3     21.57-22.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.961 Buy
20-DMA   19.54 Buy
50-DMA   20.33 Sell
100-DMA   21.30 Sell
200-DMA   22.33 Sell
STOCH(5,3)   74.746 Sell
MACD(12,26,9)   0.1095 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$90.06/bbl, an intraday low of US$85.36/bbl, and settled down by 0.867% to close at US$86.66/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, 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 88.20-95.00 with stop loss at 95.00; targeting 87.00 and 86.10-84.90-83.70. Buy above 86.50-83.70 with risk daily closing below 83.70; targeting 88.20-89.00-90.50 and 91.30-92.35-93.00

 
Intraday Support Levels
S1     86.80-86.10
S2     84.90
S3     83.7-83.00

Intraday Resistance Levels
R1     88.20-89.00
R2     90.50-91.30
R3     90.50-91.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.672 Sell
20-DMA   93.24 Buy
50-DMA   98.21 Buy
100-DMA   99.53 Buy
200-DMA   94.54 Buy
STOCH(5,3)   61.74 Sell
MACD(12,26,9)   -2.898 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.0122/EUR, a high of US$1.0194/EUR, and settled the day up by 0.0994% to close at US$1.0170/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 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 1.0190-1.0430, 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 below 0.9800, targeting 1.0290-1.0335-1.0390 and 1.0430-1.0470.

 
Intraday Support Levels
S1     1.0150-1.0090
S2     1.0030
S3     0.9995-0.9950

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.220 Buy
20-DMA   1.0217 Buy
50-DMA   1.0311 Sell
100-DMA   1.0507 Sell
200-DMA   1.0805 Sell
STOCH(5,3)   73.410 Buy
MACD(12,26,9)   -0.011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2007/GBP, a high of US$1.2117/GBP, and settled the day up 0.329% to close at US$1.2090/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 1.2060-1.1700 with a target of 1.2110-1.2150-1.2245 and 1.2310-1.2405-1.2479 with stop loss closing below 1.1700. Sell in between 1.2110-1.2550 with targets at 1.2010-1.1930 and 1.1870-1.1805 with stop loss should be 1.2630.

 
Intraday Support Levels
S1     1.2060-1.2010
S2     1.1930-1.1890
S3     1.1805-1.1760

Intraday Resistance Levels
R1     1.2110
R2     1.2150-1.2245
R3     1.2300-1.2355

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

47.106

Buy
20-DMA   1.2109 Buy
50-DMA   1.2179 Buy
100-DMA   1.2407 Sell
200-DMA   1.2755 Sell
STOCH(5,3)   40.428 Sell
MACD(12,26,9)   0.002 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made an intra‐day low of JPY132.94/USD and made an intraday high of JPY134.68/USD and settled the day up by 0.660% at JPY134.18/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 134.10-137.9 with risk above 137.90 targeting 132.50-131.90-130.70 and 130.25-129.40-128.50. Long positions above 132.50-128.50 with targets of 134.10 and 135.25-136.30-136.75 with stops below 128.50.

 
Intraday Support Levels
S1     134.10-133.00
S2     132.50
S3     131.90-130.75

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.635 Buy
20-DMA   135.52 Sell
50-DMA   134.08 Sell
100-DMA   130.67 Sell
200-DMA   125.17 Buy
STOCH(9,6)   86.382 Buy
MACD(12,26,9)   -0.361 Sell

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