AAFX TRADING

Daily Market Lookup

  • The dollar clawed back earlier losses on Monday as a hawkish Federal Reserve official laid out the case for further rate hikes, while the Australian dollar sank on concerns about unrest over COVID-19 restrictions in China. The greenback rebounded in early U.S. trading and added to gains after St. Louis Fed President James Bullard said the U.S. central bank needs to raise interest rates quite a bit further and then hold them there throughout next year and into 2024 to gain control of inflation and bring it back toward the Fed's 2% goal. Comments from Fed Chair Jerome Powell on Wednesday will be watched for any new signals on further tightening with key U.S. jobs data for November also due on Friday. The U.S. central bank is expected to hike rates by an additional 50 basis points when it meets on Dec. 13-14. The dollar index has fallen to 106.65 from a 20-year high of 114.78 on Sept. 28 on expectations that its rally may have been over stretched and as the Fed looks to slow its pace of rate increases. Some of the recent decline is also likely due to investors and traders booking profits before year-end, said Trevisani, noting many trading firms curtail activity in December. The greenback was also likely supported after the dollar index reached the 200-day moving average at 105.369. The index also posted an outside day, reaching both a higher high and a lower low than the previous session, which could bode well for further gains, Tom Fitzpatrick, chief technical strategist at Citigroup (NYSE:C), said in a note. It is the first bullish outside day on the dollar index since the high reached on Sept. 28 and is the first time it has tested the 200-day moving average since June 2021, he said The dollar had dipped earlier on Monday despite other safe-haven currencies the Japanese yen and the Swiss franc gaining on concerns about China. Hundreds of demonstrators and police clashed in Shanghai on Sunday night as protests over China's stringent COVID restrictions flared for a third day and spread to several cities in the wake of a deadly fire in the country's far west. The risk sensitive Aussie dollar, which is strongly tied to Chinese growth, was the worst performing major currency, falling 1.61% to $0.6649. The currency was also dented by data showing Australian retail sales suffered their first fall of 2022 in October as rising prices and higher interest rates finally seemed to have an impact on spending. The offshore yuan weakened against the dollar to 7.2468. Bitcoin fell after major cryptocurrency lender BlockFi filed for Chapter 11 bankruptcy protection along with eight affiliates, the latest crypto casualty to follow the spectacular collapse of the FTX exchange earlier this month.
  • Gold prices fell below a key support level on Tuesday after hawkish comments from Federal Reserve officials brewed some uncertainty over the path of U.S. monetary policy, while copper prices steadied as markets awaited more developments in China. St. Louis Fed President James Bullard said on Monday that the Fed has “a ways to go” on interest rate hikes, and could keep hiking them and hold them until 2024 to combat inflation. He also reiterated his view that rates need to rise by at least another 1% to between 5% and 5.25%. Separately, New York Federal Reserve President John Williams said the central bank will likely begin trimming rates in 2024, as inflation pressures eventually ease. He also said that borrowing costs need to rise further to bring down inflation. Their comments boosted the dollar, with the greenback jumping nearly 0.7% on Monday. This weighed on most metal markets, particularly gold. While Bullard and Williams’ comments provided some more clarity on U.S. monetary policy, they also dimmed optimism over a slower pace of rate hikes by the Fed in the coming months, given that rates will likely peak at much higher levels. This paints a dour picture for non-yielding assets such as gold, which fell sharply this year as U.S. rates began rising. Gold saw little safe haven demand this week, even as unprecedented civil unrest in China raised concerns over global economic disruptions. Copper, on the other hand, marked a volatile start to the week, sinking as much as 2% before recovering sharply to trade higher. The outlook for the red metal was dulled by the protests in China, which could further hamper the country’s appetite for commodities. Chinese citizens in several major cities took to the streets over the weekend to express their discontent with the country’s draconian zero-COVID policy. But some analysts opined that the protests in China may eventually push the government into relaxing its zero-COVID policy, which is at the heart of China’s economic slowdown this year. Such a scenario is likely to be positive for commodity markets. On the supply side, reports suggested that workers at Chile’s massive Escondida copper mine will not go on strike, reducing the prospect of tight supply in the coming months.
  • Oil prices jumped on Tuesday as traders bet that recent weakness in the market will invite more supply cuts by the OPEC, while anti-government protests in China and hawkish signals from the Federal Reserve worsened the outlook for demand. But prices recovered later in the session, ending Monday a shade higher as markets bet that the Organization of Petroleum Exporting Countries (OPEC) will step in to support prices. The cartel is set to meet on December 4, its last meeting for the year, to decide on production. Oil prices are currently trading below the levels that spurred October’s supply cut by the OPEC, driving up hopes that the cartel will cut production when it meets this Sunday. The OPEC announced a 2 million barrel per day supply cut in October to drive up prices, which had briefly put oil close to $100 a barrel. But concerns over weakening demand, swiftly pulled back prices, driving them to an 11-month low in recent sessions. Rising U.S. interest rates and waning demand in China were the biggest headwinds to oil markets this year, while strength in the dollar also made crude shipments more expensive for major importers. Hawkish signals from the Federal Reserve on Monday drove up the dollar and indicated pressure on the U.S. economy, which could dent its appetite for crude. Fed members James Bullard and John Williams both said on Monday that the central bank will likely begin trimming rates well into 2024, and that more rate hikes were warranted to combat inflation Anti-government protests in China now raise the prospect of more economic disruption in the world’s largest crude importer. But some analysts argued that the protests could also push the government into relaxing its strict anti-COVID measures, which is the target of the protestors. China is grappling with its worst COVID outbreak ever, which could see the government remain hesitant over relaxing its zero-COVID policy. The recent protests were triggered by the reintroduction of anti-COVID restrictions across several major cities.

 

 
Intraday RESISTANCE LEVELS
29th November 2022 R1 R2 R3
GOLD-XAU 1,759 1,774-1,781 1,790-1,800
Silver-XAG 21.90 22.10-22.50 23.00-23.30
Crude Oil 78.70-79.60 80.50 81.80-82.50
EURO/USD 1.0450-1.0490 1.0520-1.0550 1.0610-1.0650
GBP/USD 1.2090-1.2120 1.2200-1.2280 1.2350-1.2400
USD/JPY 139.20-140.20 141.10-142.10 143.00-143.80

Intraday SUPPORTS LEVELS
29th November 2022 S1 S2 S3
GOLD-XAU 1,750-1,736 1,724-1,716 1,705-1,690
Silver-XAG 21.20-20.70 20.06-19.80 18.90-18.50
Crude Oil 77.90-77.00 76.10-75.25 74.20-73.00
EURO/USD 1.0350-1.0290 1.0210-1.0150 1.0105-1.0099
GBP/USD 1.2030-1.1950 1.1870 1.1790--1.1750
USD/JPY 138.10-137.70 137.00 136.50-136.00

Intra-Day Strategy (29th 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 Monday made its intraday high of US$1763.66/oz and low of $1745.90/oz. Gold is down by 0.846% at US$1741.40/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 1755-1800 keeping stop loss closing above 1800, targeting and 1750-1736-1724 and 1716-1700-1690. Buy in between 1744-1690 with risk below 1640, targeting 1750-1759-1774 and 1781-1790-1800.

 
Intraday Support Levels
S1     1,750-1,736
S2     1,724-1,716
S3     1,705-1,690
Intraday Resistance Levels
R1     1,759
R2     1,774-1,781
R3     1,790-1,800

Technical Indicators

Name   Value Action
14DRSI  

61.319

Buy
20-DMA   1726.07 Buy
50-DMA  

1708.25

Buy
100-DMA   1724.77 Buy
200-DMA   1759.03 Buy
STOCH(5,3)   40.762 Sell
MACD(12,26,9)   22.464 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$21.61/oz and low of US20.86/oz settled down by 2.00% at US$20.92/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 21.20-18.30, targeting 22.00-22.50-23.00 and 23.30-23.70 with stop loss should be placed on the breakage below 18.00. Sell in between 22.10-23.40 with stop loss above 23.40; targeting 21.70-21.30-20.70-20.10 and 19.80-18.90-18.30.

 
Intraday  Support Levels
S1     21.20-20.70
S2     20.06-19.80
S3     18.90-18.50

Intraday  Resistance Levels
R1     21.90
R2     22.10-22.50
R3     23.00-23.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   61.882 Buy
20-DMA   20.84 Buy
50-DMA   20.22 Buy
100-DMA   20.21 Buy
200-DMA   20.95 Buy
STOCH(5,3)   67.450 Sell
MACD(12,26,9)   0.4775 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$77.84/bbl, an intraday low of US$73.63/bbl, and settled up by 0.156% to close at US$76.52/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 78.70-82.50 with stop loss at 82.50; targeting 77.90-77.00-76.10 and 75.25-74.20-73.00. Buy above 77.90-73.00 with risk daily closing below 73.00; targeting 78.70-79.60-80.50 and 81.80-82.50.

 
Intraday Support Levels
S1     77.90-77.00
S2     76.10-75.25
S3     74.20-73.00

Intraday Resistance Levels
R1     78.70-79.60
R2     80.50
R3     81.80-82.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.105 Sell
20-DMA   82.95 Buy
50-DMA   85.28 Buy
100-DMA   88.44 Sell
200-DMA   89.82 Sell
STOCH(5,3)   35.053 Sell
MACD(12,26,9)   0.501 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.0329/EUR, a high of US$1.0496/EUR, and settled the day down by 0.293% to close at US$1.0338/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 1.0450-1.0650, targeting 1.0390-1.0290-1.0210 and 1.0150-1.0105-1.0099 with stop-loss at daily closing above 1.0545. Buy above 1.0350-1.0050 with risk below 1.0050 targeting 1.0450-1.0490-1.0520 and 1.0550-1.0610-1.0650.

 
Intraday Support Levels
S1     1.0350-1.0290
S2     1.0210-1.0150
S3     1.0105-1.0099

Intraday  Resistance Levels
R1     1.0450-1.0490
R2     1.0520-1.0550
R3     1.0610-1.0650

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.673 Buy
20-DMA   1.0199 Sell
50-DMA   1.0072 Buy
100-DMA   1.0123 Buy
200-DMA   1.0384 Buy
STOCH(5,3)   75.179 Buy
MACD(12,26,9)   0.0131 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2057/GBP, a high of US$1.2153/GBP, and settled the day up 0.464% to close at US$1.2057/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 20DMA (1.2113) is becoming a resistance level. 14-D RSI is currently in a neutral 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 1.2030-1.1680 with a target of 1.2090-1.2120-1.2200 and 1.2280-1.2350 with a stop loss closing below 1.1680. Sell in between 1.2120-1.2350 with targets at 1.2030-1.1950-1.1870 and 1.1790-1.1750-1.1680 with stop loss should be 1.2350.

 
Intraday Support Levels
S1     1.2030-1.1950
S2     1.1870
S3     1.1790--1.1750

Intraday Resistance Levels
R1     1.2090-1.2120
R2     1.2200-1.2280
R3     1.2350-1.2400

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

66.416

Buy
20-DMA   1.1770 Buy
50-DMA   1.1614 Buy
100-DMA   1.1725 Buy
200-DMA   1.2102 Sell
STOCH(5,3)   89.467 Sell
MACD(12,26,9)   0.0014 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made an intra‐day low of JPY139.41/USD and made an intraday high of JPY139.41/USD and settled the day down by 0.219% at JPY138.92/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 139.20-144.50 with risk above 144.50 targeting 138.10-137.80 and 137.00-136.60-136.00. Long positions above 138.20-136.00 with targets of 139.20-140.20-141.20 and 142.10-143.00-143.80 with stops below 143.00.

 
Intraday Support Levels
S1     138.10-137.70
S2     137.00
S3     136.50-136.00

INTRADAY RESISTANCE LEVELS
R1     139.20-140.20
R2     141.10-142.10
R3     143.00-143.80

TECHNICAL INDICATORS
Name   Value Action
14DRSI   34.408 Buy
20-DMA   141.65 Buy
50-DMA   142.80 Buy
100-DMA   140.63 Buy
200-DMA   134.90 Buy
STOCH(9,6)   14.057 Buy
MACD(12,26,9)   -1.290 Sell

AAFX TRADING
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