AAFX TRADING

Daily Market Lookup

  • The U.S. dollar pushed higher in early European trade Thursday, with buyers returning ahead of next week’s Federal Reserve meeting, while the yen struggled to hold the previous session’s gains. Attention has now switched to next week’s Fed meeting, with traders positioning for the U.S. central bank to become even more aggressive next week in its battle to curb inflation in the wake of Tuesday’s hot consumer prices report. However, the Japanese authorities failed to follow through with any concrete measures, and with the Bank of Japan unlikely to raise rates this year and data released Wednesday showing a record Japanese trade deficit for August, yen selling has resumed. The region is still struggling to cope with an energy crisis that shows no signs of easing, with Wednesday’s proposal from the bloc's executive of windfall levies on energy firms to shield consumers from soaring energy prices unlikely to solve the immediate supply issue. GBP/USD fell 0.2% to 1.1513, with the Bank of England meeting originally scheduled for later this session postponed until next week after the death of Queen Elizabeth II. U.K. consumer confidence slipped into negative territory for the first time since the pandemic lockdown in the middle of 2020, with market research company YouGov reporting that its reading of sentiment dropped 4.2 points to 98.8 in August.
  • Gold and Copper prices moved little on Friday, and were set for steep weekly losses as growing expectations of more sharp interest rate hikes by the Federal Reserve boosted the dollar and dented metal markets. Analysts had warned of more losses in gold after it slipped below $1,700- a key support level- earlier this week. Expectations of an at least 75 basis point rate hike by the Fed skyrocketed after U.S. inflation showed little signs of cooling in August. Signs of strength in the labor market also pointed to the Fed having enough space to keep raising rates at a fast pace. 10-year Treasury yields flirted with 15-year highs, while the dollar index hovered near a 20-year peak on Friday. The two have by far been the biggest weights on bullion prices this year. Gold tumbled from highs hit during the onset of the Russia-Ukraine conflict, as a series of interest rate hikes by the Fed saw investors seek better yields in the dollar and sovereign debt. With the Fed set to keep tightening policy, pressure on gold is widely expected to continue for the remainder of the year. Among industrial metals, copper prices traded flat on Friday, and were headed for a weekly loss of over 3%. Losses this week, triggered by more fears of weakening demand in China, largely offset any gains made on the prospect of tightening supply. Copper marked strong gains last week as a strike in Escondida, the world’s largest copper mine, pointed to tighter supply for the rest of the year.
  • Oil prices inched up on Friday, but were headed for a third straight week of losses on fears that COVID disruptions in China and a potential economic recession will decimate crude demand this year. The prevention of a possible U.S. railroad strike, which was expected to disrupt local crude supply, also dented prices this week. Positive Chinese industrial production and retail sales data did little to support prices on Friday, given that most other economic indicators show persistent weakness in the world’s largest crude importer. Fears of a global recession were heightened this week after both the World Bank and the International Monetary Fund warned of a potential economic slowdown in late-2022 and 2023. Data on Thursday also showed an unexpected contraction in U.S. industrial output in August, painting a dour picture for crude demand. Oil prices have plummeted from highs hit this year on concerns that weakening economic growth will erode demand this year. A steady release of oil from the U.S. Strategic Petroleum Reserve has also diluted supply, particularly of WTI crude. Markets are now positioning themselves for a steep interest rate hike by the U.S. Federal Reserve next week, with a bulk of participants seeing a 75 basis point raise. But hotter-than-expected U.S. inflation data released this week also saw investors begin pricing in the possibility of a 100 basis point hike. While U.S. gasoline demand has recovered in recent months, markets fear that rising interest rates and a potential recession will weigh on the spending strength of consumers in the coming months. Rising interest rates have also boosted the dollar, which weighs on crude prices by making oil purchases more expensive. Major Asian importers India and Indonesia have cut their imports this year on this notion.

 

 
Intraday RESISTANCE LEVELS
16th September 2022 R1 R2 R3
GOLD-XAU 1,664-1,670 1,679 1,690-1,700
Silver-XAG 19.80-20.20 20.70 21.50-21.90
Crude Oil 85.90-87.20 88.40 88.90-89.50
EURO/USD 0.9995-1.0090 1.0120-1.0190 1.0280-1.0340
GBP/USD 1.1460-1.1540 1.1600-1.1665 1.1765-1.1850
USD/JPY 144.60-145.30 146.00 146.90-147.50

Intraday SUPPORTS LEVELS
16th September 2022 S1 S2 S3
GOLD-XAU 1,651-1,640 1,631 1,620-1,610
Silver-XAG 18.90 18.40-17.80 17.40-17.00
Crude Oil 85.10-84.00 82.10 81.50-80.90
EURO/USD 0.9910-0.9860 0.9800 0.9740-0.9690
GBP/USD 1.1380-1.1350 1.1310 1.1250-1.1210
USD/JPY 143.10-142.00 141.40-140.70 140.00-139.40

Intra-Day Strategy (16th September 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$1698.13/oz and low of $1660.36/oz. Gold is down by 1.945% at US$1664.37/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 1664-1700 keeping stop loss closing above 1700, targeting 1651-1640-1631 and 1620-1610. Buy in between 1712-1664 with risk below 1664, targeting 1732-1740 and 1760-1774-1785.

 
Intraday Support Levels
S1     1,651-1,640
S2     1,631
S3     1,620-1,610
Intraday Resistance Levels
R1     1,664-1,670
R2     1,679
R3     1,690-1,700

Technical Indicators

Name   Value Action
14DRSI  

39.035

Buy
20-DMA   1724.47 Sell
50-DMA  

1749.36

Sell
100-DMA   1781.12 Sell
200-DMA   1805.85 Sell
STOCH(5,3)   38.828 Sell
MACD(12,26,9)   -14.133 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$19.65/oz and low of US19.22/oz settled down by 2.33% at US$19.16/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 19.00-16.00, targeting 19.80 and 20.45-20.70-21.45 with stop loss should be placed on the breakage below 16.90. Sell in between 19.80-21.50 with stop loss above 21.50; targeting 18.90-18.40-17.70 and 17.50-16.90-16.40.

 
Intraday  Support Levels
S1     18.90
S2     18.40-17.80
S3     17.40-17.00

Intraday  Resistance Levels
R1     19.80-20.20
R2     20.70
R3     21.50-21.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.639 Buy
20-DMA   18.81 Buy
50-DMA   19.44 Sell
100-DMA   20.41 Sell
200-DMA   21.63 Sell
STOCH(5,3)   89.103 Sell
MACD(12,26,9)   -0.375 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$88.67/bbl, an intraday low of US$84.05/bbl, and settled down by 4.32% to close at US$84.57/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, giving 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 85.90-90.80 with stop loss at 90.80; targeting 85.60-84.00 and 83.00-82.10.Buy above 85.10-82.10 with risk daily closing below 82.10; targeting 85.90-87.20-88.00 and 88.90-89.50-90.80.

 
Intraday Support Levels
S1     85.10-84.00
S2     82.10
S3     81.50-80.90

Intraday Resistance Levels
R1     85.90-87.20
R2     88.40
R3     88.90-89.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.970 Sell
20-DMA   88.22 Sell
50-DMA   92.40 Sell
100-DMA   95.61 Sell
200-DMA   93.37 Sell
STOCH(5,3)   77.424 Sell
MACD(12,26,9)   -1.971 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$0.9955/EUR, a high of US$1.0017/EUR, and settled the day up by 0.180% to close at US$0.9998/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 0.9950-1.0430, targeting 0.9950-0.9900-0.9860 and 0.9800-0.9740-0.9690 with stop-loss at daily closing above 1.0430. Buy above 0.9910-0.9690 with risk below 0.9690, targeting 0.995-1.009-1.0120 and 1.0190-1.0280-1.0340.

 
Intraday Support Levels
S1     0.9910-0.9860
S2     0.9800
S3     0.9740-0.9690

Intraday  Resistance Levels
R1     0.9995-1.0090
R2     1.0120-1.0190
R3     1.0280-1.0340

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.786 Buy
20-DMA   1.0023 Buy
50-DMA   1.0133 Buy
100-DMA   1.0328 Sell
200-DMA   1.0652 Sell
STOCH(5,3)   41.104 Buy
MACD(12,26,9)   -0.0025 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.1461/GBP, a high of US$1.1550/GBP, and settled the day down 0.682% to close at US$1.1462/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 1.1460-1.1250 with a target of 1.1540-1.1600-1.1665 and 1.1760-1.1850-1.1890 with stop loss closing below 1.1250. Sell in between 1.1540-1.1850 with targets at 1.1460-1.1380-1.1350 and 1.1310-1.1250 with stop loss should be 1.2630.

 
Intraday Support Levels
S1     1.1380-1.1350
S2     1.1310
S3     1.1250-1.1210

Intraday Resistance Levels
R1     1.1460-1.1540
R2     1.1600-1.1665
R3     1.1765-1.1850

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

32.830

Buy
20-DMA   1.1625 Sell
50-DMA   1.1839 Sell
100-DMA   1.2118 Sell
200-DMA   1.2521 Sell
STOCH(5,3)   10.784 Sell
MACD(12,26,9)   -0.0136 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made an intra‐day low of JPY142.54/USD and made an intraday high of JPY143.79/USD and settled the day up by 0.396% at JPY143.47/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 144.40-147.50 with risk above 147.50 targeting 143.10-142.00-141.40 and 140.70-140.00 Long positions above 143.10-140.70 with targets of 144.60-145.30-146.00 and 146.70-147.50 with stops below 128.50.

 
Intraday Support Levels
S1     143.10-142.00
S2     141.40-140.70
S3     140.00-139.40

INTRADAY RESISTANCE LEVELS
R1     144.60-145.30
R2     146.00
R3     146.90-147.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.699 Buy
20-DMA   141.00 Buy
50-DMA   138.06 Buy
100-DMA   134.43 Buy
200-DMA   128.58 Buy
STOCH(9,6)   64.647 Buy
MACD(12,26,9)   2.184 Sell

AAFX TRADING
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