AAFX TRADING

Daily Market Lookup

  • Most Asian currencies crept higher on Wednesday as markets awaited more cues on U.S. monetary policy from Federal Reserve Chair Jerome Powell, although weak economic data from China and uncertainty over the country’s COVID policy weighed on sentiment. Still, most regional units were set to end November substantially higher on a weaker dollar and expectations of slower interest rate hikes by the Fed. The Chinese yuan rose 0.2%, even as data showed that business activity in the country shrank more than expected in November. The data highlights the increasing impact of anti-COVID policies on China’s economic health, as the country grapples with record-high increases in infections. Markets also grew uncertain over whether the Chinese government would scale back its strict zero-COVID policy amid increasing public backlash against lockdown measures. While unfounded rumors over such a move had spurred strong gains in Chinese markets on Tuesday, the rally appeared to be running out of steam. Still, the yuan was set to rise over 2% in November as it benefited from a weaker dollar. Broader Asian currencies strengthened slightly as the dollar retreated, although sentiment remained fragile ahead of an address by Fed Chair Powell later in the day. The dollar index and dollar index futures fell 0.1% each. The Fed Chair is widely expected to set the tone for U.S. monetary policy for the remainder of the year by providing more clarity on whether U.S. rate hikes will slow down. While the minutes of the November meeting showed that policymakers supported a slower pace of interest rate hikes in the coming months, several Fed members warned that this will be contingent on the path of U.S. inflation, which is still trending well above the central bank’s annual target. Still, expectations of slower interest rate hikes by the Fed put most Asian currencies on course for strong gains in November. The South Korean won was the best performer this month, up nearly 7.5% as the Bank of Korea signaled that it will keep raising interest rates to combat inflation. However, economic indicators in the country continued to worsen, with recent data showing that industrial production unexpectedly shrank in October. The Thai baht rose 0.2% ahead of a widely-expected interest rate hike on Wednesday and was the best-performing Southeast Asian currency in November with a 7% jump
  • The greenback edged lower against the Japanese yen on Tuesday with Federal Reserve chairman Jerome Powell due to speak on Wednesday, while the Aussie dollar jumped as sentiment improved on hopes that China would reopen from COVID shutdowns. Powell’s comments will be evaluated for any new signs of hawkishness, with key jobs data for November due on Friday The dollar index has fallen to 106.82 from a 20-year high of 114.78 on Sept. 28 as investors look toward the U.S. central bank reaching a peak rate early next year with inflation pressures expected to subside The U.S. central bank is expected to hike rates by an additional 50 basis points when it meets on Dec. 13-14, though the odds of a 75-basis-point increase have risen over the past several weeks and now stand at a 37% probability Traders are pricing for the Fed funds rate to peak at 5.01% in June, before falling back to 4.64% by December 2023. Moves in dollar/yen are highly correlated to U.S. interest rate policy and the Japanese currency has benefited as investors pare back expectations for further aggressive U.S. rate hikes. Data on Tuesday showed that U.S. consumer confidence slipped to a four-month low in November, with households less keen to spend on big-ticket items over the next six months amid high inflation and rising borrowing costs. The Aussie jumped after health officials said that China will speed up COVID-19 vaccinations for elderly people, aiming to overcome a key stumbling block in efforts to ease unpopular "zero-COVID" curbs. Risk appetite had worsened on Monday after protesters and police clashed over the stringent COVID restrictions. Chinese authorities have begun inquiries into some of the people who gathered at weekend protests as police remained out in numbers on the city's streets. Euro zone inflation data due on Wednesday is also in focus after figures showed inflation in Spain and Germany came in below expectations European Central Bank President Christine Lagarde said on Monday euro zone inflation had not peaked and it risked turning out even higher than currently expected, hinting at a series of interest rate hikes ahead.
  • The U.S. dollar weakened in early European trade Tuesday and the Chinese yuan gained on hopes the Chinese government was set to ease its tight COVID-related mobility restrictions, boosting risk appetite. China reported on Monday its first drop in the number of daily infections in more than a week. This followed civil unrest over the weekend as frustrations over the country’s prolonged mobility restrictions boiled over. The country's National Health Commission on Tuesday said it will present measures to accelerate vaccination of the over 80s, a vulnerable age bracket in which over one-third is still unprotected. The move is the first clear signal of official intent since the wave of anti-government protests, and traders have started to speculate that this is the first stage of the Chinese government scaling back its anti-COVID policies. The U.S. dollar had traded higher Monday, boosted not only by its status as a safe haven, but also by more hawkish talk from Federal Reserve policymakers. Richmond Federal Reserve Bank President Thomas Barkin said on Monday he supports moving to smaller interest-rate hikes in the central bank's fight to bring down too-high inflation, but this could mean a higher ultimate peak Fed Chair Jerome Powell is also scheduled to discuss the economic outlook on Wednesday, ahead of Friday’s crucial official monthly jobs report. Spanish inflation rose 6.8% on the year in November, a drop of 0.1% on the month, below last month's 7.3%. German CPI numbers are also due for release later in the session, ahead of Wednesday’s Eurozone CPI data. ECB President Christine Lagarde said on Monday, in a speech to the European Parliament, that the region’s inflation has not peaked and it risks turning out even higher than currently expected.

 

 
Intraday RESISTANCE LEVELS
30th 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 1.2030-1.2090 1.2120-1.2200 1.2280-1.2350
USD/JPY 139.20-140.20 141.10-142.10 143.00-143.80

Intraday SUPPORTS LEVELS
30th November 2022 S1 S2 S3
GOLD-XAU 1,750-1,736 1,724-1,716 1,705-1,690
Silver-XAG 21.10-20.70 20.06-19.80 18.90-18.50
Crude Oil 77.90-77.00 76.10-75.25 74.20-73.00
EURO/USD 1.0320-1.0290 1.0210-1.0150 1.0105-1.0099
GBP/USD 1.1950-1.1870 1.1790 1.1750-1.1650
USD/JPY 138.10-137.70 137.00 136.50-136.00

Intra-Day Strategy (30th 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 Tuesday made its intraday high of US$1758.91/oz and low of $1739.49/oz. Gold is down by 0.846% at US$1749.58/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 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 Tuesday made its intraday high of US$21.44/oz and low of US20.89/oz settled up by 1.55% at US$21.24/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     21.10-20.70
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 Tuesday made an intra‐day high of US$79.64/bbl, an intraday low of US$76.31/bbl, and settled up by 2.96% to close at US$78.91/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$1.0319/EUR, a high of US$1.0394/EUR, and settled the day down by 0.107% to close at US$1.0327/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     1.0320-1.0290
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 Tuesday made an intra‐day low of US$1.1944/GBP, a high of US$1.2063/GBP, and settled the day down 0.044% to close at US$1.1948/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     1.1950-1.1870
S2     1.1790
S3     1.1750-1.1650

Intraday Resistance Levels
R1     1.2030-1.2090
R2     1.2120-1.2200
R3     1.2280-1.2350

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 Tuesday made an intra‐day low of JPY137.86/USD and made an intraday high of JPY139.34/USD and settled the day down by 0.274% at JPY138.53/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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