AAFX TRADING

Daily Market Lookup

  • The U.S. Federal Reserve is expected to hold interest rates steady at its meeting this week as it pauses to parse more economic data but may hint it is on track for an increase in June. The central bank is scheduled to release its policy decision at 2 p.m. EDT (1800 GMT) on Wednesday at the conclusion of its two-day meeting. Fed Chair Janet Yellen is not due to hold a press conference. Most policymakers have already made plain that in contrast to previous years, the Fed feels more confident in its forecast of two more rate increases this year. The Fed is in its first tightening cycle in more than a decade. A quarter percentage point increase last December was followed two meetings later by another hike in March. Economists polled by Reuters see little chance of a move at this week's meeting. The rate-setting committee also is still waiting to see to what extent Trump administration policies on tax, spending and regulation will be able to get through Congress. A stimulus package could speed up the pace of hikes. Since the last meeting economic data has been mixed. The economy grew at a sluggish 0.7% annual pace in the first quarter as consumer spending almost stalled. However, a surge in business investment and the fastest wage growth in a decade suggest activity will regain momentum as the year progresses. Jobs growth also slowed sharply in March but the unemployment rate dropped to a near 10-year low of 4.5 percent. Economists have largely attributed the weak first-quarter reading to perennial issues with the calculation of growth during the January-March period and the pullback in hiring in March to weather effects The Fed will have two more employment growth reports to hand before its next meeting. Policymakers are also gearing up to announce sometime this year when and how the Fed will begin shrinking its $4.5 trillion balance sheet, according to minutes from the March meeting. An announcement this week on a concrete timeline is not expected but there could be tweaks to language in the statement to show the matter is an increasing priority for the Fed.
  • Gold gained on heighted risk connected to the Korean peninsula, while copper fell on disappointing figures on manufacturing from China. In Asia, the Bank of Japan released minutes from its March policy meeting and policymakers agreed to closely monitor consumer prices because they currently lack upward momentum. The minutes repeated earlier phrasing that over time, consumer prices will reach the central bank's 2 percent inflation target but the BOJ needs to continue with its quantitative easing, according to the minutes. Last week on April 27, the Bank of Japan raised its economic forecasts at its policy meeting outcome on Thursday, but it kept policy steady, as was widely expected. As well, the Caixin manufacturing PMI for April came in at 50.3, compared with an expected level of 51.2, taking the measure to a seven-month low. The figures follow official data released on Sunday China's PMI fell to a six-month low of 51.2 in April from March's near five-year high of 51.8. The private sector Caixin/Markit PMI manufacturing survey focuses more on small and mid-sized firms. Overnight, gold prices declined in European trading on Monday, falling toward a three-week low after U.S. congressional leaders reached an agreement to fund the government through the fall. Negotiators in the U.S. Congress reached a deal late on Sunday on around $1 trillion in federal funding that would fund the government through September 30 and avert a government shutdown later this week. The full House of Representatives and Senate must still approve the bipartisan pact, which would be the first major legislation to clear Congress since Donald Trump became president on January 20. The news boosted risk-sensitive assets, such as global equities, and sparked a sell-off in assets perceived as safe, such as the yen, bullion and U.S. Treasuries, which are often used as a hedge in times of political uncertainty. Crude prices held weaker on Tuesday as a survey on manufacturing in China came in weaker than expected and investors looked ahead to U.S. inventories on crude and refined products to set the tone. The API will report its estimates of crude and refined product stocks after the market close in the U.S on Tuesday to be followed by the EIA with official figures on Wednesday. Crude futures settled lower on Monday; after Libya ramped up production while fears resurfaced that rising U.S. production would offset an OPEC-led deal to curb the global glut in supply. Oil prices added to losses sustained in April, as Libya fuelled oversupply concerns, after production rebounded to the highest rate since 2014, Mustafa Sanalla, chairman of the National Oil Corp. said Libya’s crude production rebounded as the country’s two key oilfields resumed output, after protests that had blocked pipelines came to an end. Meanwhile rising U.S. production jitters continued into the month of May, after Oilfield services firm Baker Hughes reported its weekly U.S. rig count rose by 9 to 697. Crude output, which hit its highest rate since April 2015, remained one of the key factors contributing to the recent slide in oil prices as investors feared that rising U.S. production would offset an OPEC-led deal to curb the global glut in supply. Comments from Iran’s oil minister, Bijan Zangeneh, failed to lift sentiment. Mr Zengeneh said that OPEC and non-OPEC producers had given positive signals for an extension of output cuts. OPEC will decide at talks on May 25 whether to extend production cuts beyond June.

 

 
Intraday RESISTANCE LEVELS
2nd May 2017 R1 R2 R3
GOLD-XAU 1,259 1,270-1,280 1,289
Silver-XAG 17.00-17.30 17.70 18.05-18.95
Crude Oil 49.00 50.05 51.10-51.90
EURO/USD 1.0955-1.1000 1.1055 1.1110
GBP/USD 1.2950-13015 1.3070 1.3100
USD/JPY 112.60-113.20 114.00 114.60

Intraday SUPPORTS LEVELS
2nd May 2017 S1 S2 S3
GOLD-XAU 1,248-1,239 1,232 1,221
Silver-XAG 16.80-16.60 16.30 15.90
Crude Oil 46.50 47.00 46.50
EURO/USD 1.0890 1.0840-1.0800 1.0750
GBP/USD 1.2910-1.2890 1.2840 1.2775-1.2700
USD/JPY 112.00 111.40 110.90-110.50

Intra-Day Strategy (2nd May 2017)
GOLD-XAU Neutral
Silver-XAG Neutral
Crude Oil Neutral
EUR/USD Neutral to Sell
GBP/USD Neutral to Sell
USD/JPY Neutral to Buy

Gold – XAU

AAFX TRADING

Gold closed down on Monday and made its intraday high of 1256.37/oz and intraday low of US$1254.07/oz. Gold down by 0.862% at US$1256.37/oz.

Technicals in Focus:

In daily charts, prices are below 200DMA (1260) and breakage above will call for 1292-1300. MACD is below zero line and histograms are decreasing trend and it will bring downward stance in the upcoming sessions. RSI is approaching neutral region and more upside is expected before it touched overbought region. Stochastic Oscillator is in overbought territory and giving negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1260-1300 keeping stop loss closing above 1300 and targeting 1254-1248 and 1240-1230. Buy above 1250-1232 with risk below 1232, targeting 1260-1277 and 1289-1300.

 
Intraday Support Levels
S1     1,248-1,239
S2     1,232
S3     1,221
Intraday Resistance Levels
R1     1,259
R2     1,270-1,280
R3     1,289

Technical Indicators

Name   Value Action
14DRSI  

45.997

Buy
20-DMA   1269.49 Buy
50-DMA  

1248.80

Buy
100-DMA   1218.67 Buy
200-DMA   1252.74 Buy
STOCH(5,3)   20.711 Sell
MACD(12,26,9)   4.205 Sell

Silver - XAG

AAFX TRADING

Silver closed on Monday from made its intraday high of US$17.24/oz after setting intraday low of US$16.77/oz. Silver settled by down by 2.15% at US$16.82/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (17.35), breakage above will lead to 17.80-18.00. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in oversold region, indicating buy signal for now. The Stochastic Oscillator is in oversold region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 17.00-16.10 targeting 17.36-17.70 and 18.05-18.45-18.90; stop breakage below 16.00. Sell below 17.40-19.20 with stop loss above 19.20; targeting 17.00-16.80 and 16.60-16.10.

 
Intraday  Support Levels
S1     16.80-16.60
S2     16.30
S3     15.90

Intraday  Resistance Levels
R1     17.00-17.30
R2     17.70
R3     18.05-18.95

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.994 Buy
20-DMA   17.88 Sell
50-DMA   17.79 Sell
100-DMA   17.35 Sell
200-DMA   17.89 Sell
STOCH(5,3)   8.084 Buy
MACD(12,26,9)   -0.219 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$49.30/bbl and made an intraday low of US$48.57/bbl and settled down by 0.875% at US$48.71/bbl on session close.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 51.55 which is a major support and breakage above will call for 52.00-50.60. MACD is above zero line and histograms are in decreasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in oversold region and giving negative crossover for confirmation of bearish stance; while the RSI is in oversold region and more downside can be expected.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 49.00-52.00 with stop loss at 52.00; targeting 48.30-47.60 and 47.00-46.50. Buy above 48.30-46.50 with risk daily closing below 46.50 and targeting 49.00-50.05-51.10 and 51.90-52.50.

 
Intraday Support Levels
S1     46.50
S2     47.00
S3     46.50

Intraday Resistance Levels
R1     49.00
R2     50.05
R3     51.10-51.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.352 Sell
20-DMA   50.93 Buy
50-DMA   50.81 Buy
100-DMA   51.91 Buy
200-DMA   49.21 Buy
STOCH(5,3)   32.230 Sell
MACD(12,26,9)   -0.462 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.0883/EUR and made an intraday high of US$1.0923/EUR and settled the day down by 0.110% at US$1.0897/EUR on session close.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0651), which become immediate support level, break below will target 1.0626-1.0600. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving upwards directions to consider buy.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.0955-1.1110 targeting 1.0890-1.0840 and 1.0800-1.0750-1.0700 with stop-loss at daily closing above 1.1110. Buy above 1.0890-1.0750 with risk below 1.0750 targeting 1.0955-1.1000 and 1.1055-1.1110.

 
Intraday Support Levels
S1     1.0890
S2     1.0840-1.0800
S3     1.0750

Intraday  Resistance Levels
R1     1.0955-1.1000
R2     1.1055
R3     1.1110

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.681 Buy
20-DMA   1.0738 Buy
50-DMA   1.0695 Buy
100-DMA   1.0643 Buy
200-DMA   1.0833 Buy
STOCH(5,3)   55.663 Sell
MACD(12,26,9)   0.0062 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2887/GBP and made an intraday high of US$1.2964/GBP and settled the day up by 0.372% at US$1.2905/GBP on session close.

Technicals in Focus:

On daily charts, prices are sustaining above 200DMA (1.2616) is become major support level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in overbought territory and giving positive crossover to confirm bullish stance. MACD is below zero line and histograms are decreasing lead to downward movement.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; short positions below 1.2950-1.3100 with targets at 1.2910-1.2950-1.2840 and 1.2775-1.2700, breakage above 1.3100 look for further upside with 1.3150 as targets. Buy above 1.2910-1.2700 with stop loss closing below 1.2700 targeting 1.2950-1.3015 and 1.3070-1.3100.

 
Intraday Support Levels
S1     1.2910-1.2890
S2     1.2840
S3     1.2775-1.2700

Intraday Resistance Levels
R1     1.2950-13015
R2     1.3070
R3     1.3100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

69.739

Buy
20-DMA   1.2622 Buy
50-DMA   1.2469 Buy
100-DMA   1.2436 Buy
200-DMA   1.2609 Buy
STOCH(5,3)   87.643 Buy
MACD(12,26,9)   0.0118 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY111.200/USD and made an intraday high of JPY111.92/USD and settled the day up by 0.530% at JPY111.80/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (108.90), which is major support on the daily chart. 14-D RSI is currently is approaching oversold region. MACD is above zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is approaching overbought territory and signaling to buy as it has given positive crossover to confirm bearish stance.

Trading Strategy: Neutral to Buy

Long positions above 112.00-109.9 with targets of 112.60-113.20 and 114.00-114.60 with stop below 110.00. Sell below 112.60-114.60 with risk above 114.60 targeting 112.00-111.40-110.90 and 110.50-109.90.

 
Intraday Support Levels
S1     112.00
S2     111.40
S3     110.90-110.50

INTRADAY RESISTANCE LEVELS
R1     112.60-113.20
R2     114.00
R3     114.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   88.139 Buy
20-DMA   110.07 Buy
50-DMA   111.71 Buy
100-DMA   113.37 Sell
200-DMA   109.03 Buy
STOCH(9,6)   92.192 Buy
MACD(12,26,9)   -0.107 Sell

AAFX TRADING
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