AAFX TRADING

Daily Market Lookup

  • The dollar firmed on Monday as sentiment soured after China said it is sticking with its strict COVID restrictions, quashing hopes of an imminent reopening in the world's second-largest economy which had earlier fired a broad rally in riskier assets. China said over the weekend that it will persevere with its "dynamic-clearing" approach to COVID-19 cases as soon as they emerge, giving little indication it would ease its outlier zero-COVID strategy nearly three years into the pandemic. The two currencies were huge beneficiaries of a broad rally on Friday - rising nearly 3% - as speculation that China could soon end its COVID restrictions gathered pace and buoyed risk appetite. The economic impact of China's zero-COVID policy was again highlighted in trade figures released on Monday, which showed exports and imports unexpectedly contracted in October, the first simultaneous slump since May 2020. Elsewhere, sterling edged 0.3% lower to $1.1340, while the euro slipped 0.1% to $0.9949, erasing some of their roughly 2% jump on Friday. Investors were also assessing Friday's U.S. jobs report which showed that firms added a more-than-expected 261,000 jobs in October and hourly wages continued to rise, evidence of a still-tight labour market. But hints of some easing of market conditions, with the unemployment rate rising to 3.7%, fuelled hopes that the much sought after Fed pivot could be on the horizon, capping the dollar's gains. Four Federal Reserve policymakers on Friday also indicated they would still consider a smaller interest rate hike at their next policy meeting.
  • The U.S. dollar gained in early European trade Monday, with risk sentiment on the wane after China affirmed its commitment to its zero-COVID policy. Chinese health officials confirmed over the weekend that the country will maintain its current strict policy on battling COVID-19, dashing hopes that had sprung up last week of a withdrawal from the strategy which had contributed to the slowing of growth at the world’s second-largest economy. Still, gains are limited as traders cautiously await the release of key U.S. inflation data on Thursday, which could provide more clues as to the Federal Reserve’s hiking intentions in December, as well as the political ramifications from the midterm elections on Tuesday where control of Congress and President Joe Biden's agenda for the remaining two years of his term are at stake. Industrial output in the Eurozone’s largest economy grew by 0.6% on the month in September, more than the 0.2% growth expected, and substantially better than the revised fall of 1.2% the previous month. The U.K. is set to release preliminary data on third-quarter growth on Friday, which is expected to show that the economy contracted 0.5% in the three months to September. Asian currencies struggling with the Chinese COVID news as well as data showing both China’s exports and imports shrank in October, a disappointment given China’s importance as a growth driver for the region.
  • Oil prices fell more than $1 a barrel on Monday after Chinese health officials on the weekend reiterated their commitment to a stringent COVID containment approach, dashing hopes of a rebound in oil demand from the world's top crude importer. A jump in the U.S. dollar is also weighing on oil prices, she added. Four Federal Reserve policymakers on Friday indicated they would still consider a smaller interest rate hike at their next policy meeting despite strong jobs data. Meanwhile, China's exports and imports unexpectedly contracted in October, the first simultaneous slump since May 2020, as a perfect storm of COVID curbs at home and global recession risks dented demand and further darkened the outlook for a struggling economy. Although China's crude oil imports rebounded to the highest level since May, volume for the first 10 months was still 2.7% below the same period a year earlier at 413.53 million tonnes or 9.93 million bpd. Oil prices have been underpinned by expectations of tighter supplies as the European Union's embargo on Russia's seaborne crude exports will start on Dec. 5 even though refineries worldwide are ramping up output. U.S. oil refiners this quarter will run their plants at breakneck rates, near or above 90% of capacity. China's largest private refiner Zhejiang Petroleum and Chemical Co (ZPC) is raising diesel output. Kuwait Integrated Petroleum Industries Co (KIPIC) said on Sunday the first phase of the Al-Zour refinery has started commercial operations, according to a state news agency.?
  • Gold and copper prices fell on Monday, reversing some steep gains from the prior session as China’s recommitment to its zero-COVID policy ramped up concerns over slowing economic growth and boosted the dollar. But the greenback arrested its recent declines on Monday, with the dollar index rising 0.2%. Chinese health officials said over the weekend that the country remains “unswervingly” committed to its strict zero-COVID policy, dashing hopes of a pivot that fueled a bumper stock market rally last week. The move heralds more supply chain and economic disruptions stemming from the country, the prospect of which boosted the dollar. The greenback has largely overtaken gold as a safe haven, as rising interest rates raised the opportunity cost of holding the yellow metal. Gold is also expected to remain under pressure in the coming months, given that the Federal Reserve signaled it will keep hiking interest rates to curb inflation. Last week’s strong jobs reading gives the central bank more headroom to raise interest rates Focus this week is on U.S. inflation data for October, which is expected to show that price pressures remained pinned near 40-year highs. Such a reading is likely to invite more hawkish moves from the Fed. Copper prices fell sharply on Monday on the prospect of weakening demand in China, which is the world’s largest importer of the industrial metal. Copper futures fell 2% to $3.6235 an ounce, also reversing a sharp rally seen on Friday. China’s zero-COVID policy ground economic activity in the country to a halt this year, weighing on its appetite for commodity imports. With the country now reiterating its commitment to the policy, commodity markets are likely to see a continuation of this weakening trend. Still, copper prices are expected to somewhat benefit from tightening supply in the coming months, especially as production slows in Chile, the world’s largest copper producer. U.S. sanctions on Russian exporters and increased demand in the electric vehicle industry is also expected to tighten supply.

 

 
Intraday RESISTANCE LEVELS
7th November 2022 R1 R2 R3
GOLD-XAU 1,670-1,679 1,690 1,700-1,710
Silver-XAG 20.60-21.30 21.90 22.50-23.00
Crude Oil 91.10-92.00 93.35 94.00-94.90
EURO/USD 0.9910-0.9960 1.0099-1.0105 1.0150-1.0195
GBP/USD 1.1455-1.1495 1.1610 1.1680-1.1750
USD/JPY 148.00-148.80 149.50 150.00-150.70

Intraday SUPPORTS LEVELS
7th November 2022 S1 S2 S3
GOLD-XAU 1,652-1,640 1,630 1,616-1,600
Silver-XAG 20.10-19.80 18.90-18.30 17.80-17.50
Crude Oil 90.30-89.60 88.90-87.90 85.85-83.70
EURO/USD 0.9860-0.9800 0.9740-0.9680 0.9600-0.9565
GBP/USD 1.1370-1.1310 1.1270-1.1210 1.1150-1.1095
USD/JPY 147.50-147.00 145.95-145.30 144.50-143.80

Intra-Day Strategy (7th November 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 Friday made its intraday high of US$1681.63/oz and low of $1628.51/oz. Gold is up by 3.175% at US$1681.17/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1809) and breakage below will call for 1790. MACD is above the zero line and histograms are a2lso increasing trend and it will bring an upward stance in the upcoming sessions. RSI is in the overbought region and more upside is expected before it gets stretched. The Stochastic Oscillator is in neutral territory and giving a negative crossover to a bearish stance for intraday trade.

Trading Strategy: Sell on Strength

Sell below 1670-1714 keeping stop loss closing above 1714, targeting 1652-1640 and 1628-1614-1600. Buy in between 1652-1600 with risk below 1600, targeting 1670-1679 and 1690-1700-1714.

 
Intraday Support Levels
S1     1,652-1,640
S2     1,630
S3     1,616-1,600
Intraday Resistance Levels
R1     1,670-1,679
R2     1,690
R3     1,700-1,710

Technical Indicators

Name   Value Action
14DRSI  

Buy
20-DMA   1659.05 Sell
50-DMA  

1684.51

Sell
100-DMA   1723.70 Sell
200-DMA   1765.68 Sell
STOCH(5,3)   10.503 Sell
MACD(12,26,9)   -10.505 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$20.89/oz and low of US19.40/oz settled up by 7.15% at US$20.84/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 20.10-17.10, targeting 20.60-21.45-22.00 and 22.50-23.00 with stop loss should be placed on the breakage below 17.10. Sell in between 20.60-23.40 with stop loss above 23.40; targeting 20.10-19.80-18.90 and 18.30-17.90-17.50.

 
Intraday  Support Levels
S1     20.10-19.80
S2     18.90-18.30
S3     17.80-17.50

Intraday  Resistance Levels
R1     20.60-21.30
R2     21.90
R3     22.50-23.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.858 Buy
20-DMA   19.23 Buy
50-DMA   19.38 Sell
100-DMA   19.99 Sell
200-DMA   21.11 Sell
STOCH(5,3)   29.110 Sell
MACD(12,26,9)   -0.112 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$92.06/bbl, an intraday low of US$87.16/bbl, and settled up by 5.28% to close at US$91.81/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 91.10-93.40 with stop loss at 93.40; targeting 90.30-89.60-88.90 and 87.90-85.85-83.70. Buy above 90.30-83.60 with risk daily closing below 83.60; targeting 91.10-92.00-93.35 and 94.00-94.90.

 
Intraday Support Levels
S1     90.30-89.60
S2     88.90-87.90
S3     85.85-83.70

Intraday Resistance Levels
R1     91.10-92.00
R2     93.35
R3     94.00-94.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.623 Sell
20-DMA   87.22 Sell
50-DMA   87.50 Sell
100-DMA   90.33 Sell
200-DMA   90.88 Sell
STOCH(5,3)   76.933 Sell
MACD(12,26,9)   -0.29 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$0.9741/EUR, a high of US$0.9966/EUR, and settled the day up by 2.141% to close at US$0.9957/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0736), which becomes 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 0.9910-1.0364, targeting 0.9860 and 0.9740-0.9610-0.9550 with stop-loss at daily closing above 1.0105. Buy above 0.9860-0.9610 with risk below 0.9610, targeting 1.0099-1.0105 and 1.0130-1.0195.

 
Intraday Support Levels
S1     0.9860-0.9800
S2     0.9740-0.9680
S3     0.9600-0.9565

Intraday  Resistance Levels
R1     0.9910-0.9960
R2     1.0099-1.0105
R3     1.0150-1.0195

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.784 Buy
20-DMA   0.9874 Sell
50-DMA   0.9912 Sell
100-DMA   1.0071 Sell
200-DMA   1.0396 Sell
STOCH(5,3)   61.950 Buy
MACD(12,26,9)   0.0005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.1144/GBP, a high of US$1.1381/GBP, and settled the day down 1.923% to close at US$1.1372/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 the zero line but histograms are increasing leading to movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy in between 1.1370-1.1100 with a target of 1.1370-1.1455-1.1610 and 1.1670-1.1725 with a stop loss closing below 1.0640 Sell in between 1.1450-1.1825 with targets at 1.1370-1.1310-1.1270 and 1.1210-1.1150 with stop loss should be 1.1825.

 
Intraday Support Levels
S1     1.1370-1.1310
S2     1.1270-1.1210
S3     1.1150-1.1095

Intraday Resistance Levels
R1     1.1455-1.1495
R2     1.1610
R3     1.1680-1.1750

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

49.995

Buy
20-DMA   1.1216 Sell
50-DMA   1.1456 Sell
100-DMA   1.1796 Sell
200-DMA   1.2271 Sell
STOCH(5,3)   65.042 Sell
MACD(12,26,9)   -0.0083 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made an intra‐day low of JPY146.55/USD and made an intraday high of JPY148.39/USD and settled the day down by 1.021% at JPY146.65/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 a negative crossover to confirm a bearish stance.

Trading Strategy: Neutral to Sell

Sell below 148.00-151.70 with risk above 151.70 targeting 147.50 and 146.90-145.95-145.30. Long positions above 146.50-143.00 with targets of 148.00-148.80-149.50 and 150.00-150.60 with stops below 143.00.

 
Intraday Support Levels
S1     147.50-147.00
S2     145.95-145.30
S3     144.50-143.80

INTRADAY RESISTANCE LEVELS
R1     148.00-148.80
R2     149.50
R3     150.00-150.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.661 Buy
20-DMA   145.99 Buy
50-DMA   143.81 Buy
100-DMA   139.51 Buy
200-DMA   132.87 Buy
STOCH(9,6)   41.288 Buy
MACD(12,26,9)   1.537 Sell

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