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  • U.S. share futures and the dollar tumbled on Wednesday on worries about more U.S. political turmoil after media reports said President Donald Trump asked then-FBI Director James Comey to end a probe into Trump's former national security advisor. The reports raised questions over whether obstruction of justice charges could be laid against Trump, weakening confidence in the U.S. president's ability to push through an aggressive stimulus program that investors had been banking on since his election in November. Mike O'Rourke, chief market strategist at Jones Trading, wrote in a note that "Rising doubts about U.S. political leadership should fuel further rotation into Europe. The situation remains fluid, but this development should finally break the financial markets out of the volatility vacuum." Nobuhiko Kuramochi, chief strategist at Mizuho Securities, said "worries about European politics and North Korea have receded... But now we have worries about the Trump Administration. Given that there are some stock indexes that have risen more than 10 percent so far this year, we may be entering a consolidation phase." Trump asked Comey to end the FBI investigation into ties between former White House national security advisor Michael Flynn and Russia, according to a source who has seen a memo written by Comey. The news, first reported by the New York Times, came after Trump had fired Comey and then discussed classified national security information about Islamic State with Russian Foreign Minister Sergei Lavrov. The tumult at the White House prompted currency traders to ditch the dollar against a broad range of currencies, most notably against the yen, to which investors often turn as a safe haven when there are problems in Europe and the United States. The euro zone's GDP grew 0.5 percent in January-March, in line with expectations, and underscoring a recovery in the currency bloc. On the other hand, U.S. economic data published on Tuesday was mixed, raising more doubts about some rosy views on the economy. While U.S. manufacturing production recorded its biggest increase in more than three years in April, housing starts posted a surprise fall to five-month lows. The data came after Friday's softer-than-expected retail sales and inflation.
  • Gold prices gained in European trade on Wednesday, touching the highest level in two weeks as traders kept an eye on fresh political developments in the U.S. after President Donald Trump allegedly asked the FBI to end a probe into his former security adviser. Gold notched a fifth-straight winning session on Tuesday as the dollar sank to a six-month low amid signs of slowing economic activity in the U.S. Safe-haven demand was boosted after media reports said President Trump asked then-FBI Director James Comey to end a probe into Trump's former national security advisor, Michael Flynn. The report raised questions over whether obstruction of justice charges could be laid against Trump, adding to concerns that he will be unable to successfully push through his economic stimulus program in the face of mounting controversies. Meanwhile, a string of weaker than expected U.S. economic reports in recent days saw investors temper expectations for more rate hikes by the Federal Reserve. The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
  • Oil prices fell on Wednesday after data showed an increase in U.S. crude inventories, stoking concerns that markets remain oversupplied despite efforts by top producers Saudi Arabia and Russia to extend output cuts. U.S. crude inventories rose by 882,000 barrels in the week ending May 12 to 523.4 million, data from the American Petroleum Institute (API) showed on Tuesday. The extension of the supply cuts, which started in January and were supposed to end in June, is seen as necessary by some as they have not so far significantly tightened the market or propped up prices. The International Energy Agency said on Tuesday that commercial oil inventories in industrialized countries rose by 24.1 million barrels in the first quarter of 2016, despite the cuts. Adding to concerns of ongoing supply increases, North Sea oil production, which has long been seen as in terminal decline, is expected to jump by a net 400,000 bpd, or about a fifth of total output, in the next two years as producers improve operational efficiency. This adds to a relentless rise in U.S. production, which has jumped by over 10 percent since mid-2016 to 9.3 million bpd, not far off top producers Russia and Saudi Arabia. Investment bank Jefferies said it was lowering its oil price forecasts "between 3 percent (2H17) and 22 percent (2019)" due to a surprisingly strong production rise, especially in the United States. Jefferies said its new Brent price estimate for the second half of 2017 was $59 per barrel, down from $61 previously. It lowered its forecast for 2018 Brent from $72 per barrel to $64 per barrel, and cut its estimate for 2019 from $85 per barrel to $67 per barrel.

 

 
Intraday RESISTANCE LEVELS
17th May 2017 R1 R2 R3
GOLD-XAU 1,248 1,259-1,266 1,276
Silver-XAG 16.90-17.30 17.50 17.70
Crude Oil 48.40-48.90 49.20 50.10
EURO/USD 1.1100-1.1130 1.1200 1.1260
GBP/USD 1.2950 1.3015-1.3070 1.3100
USD/JPY 112.60-113.20 114.60 115.30-116.00

Intraday SUPPORTS LEVELS
17th May 2017 S1 S2 S3
GOLD-XAU 1,240 1,228-1,221 1,207
Silver-XAG 16.60 16.10-15.65 15.30
Crude Oil 48.00 47.15-46.50 45.40
EURO/USD 1.1054 1.1000-1.0955 1.0900
GBP/USD 1.2900-1.2840 1.2770 1.2705
USD/JPY 112.00-111.40 111.10 110.50-109.70

Intra-Day Strategy (17th 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 up on Tuesday and made its intraday high of 1238.96/oz and intraday low of US$1230.25/oz. Gold up by 0.455% at US$1236.74/oz.

Technicals in Focus:

In daily charts, prices are below 200DMA (1247) 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 1240-1266 keeping stop loss closing above 1270 and targeting 1228-1221-1207 and 1200-1190. Buy above 1232-1200 with risk below 1200, targeting 1239-1248 and 1260-1270.

 
Intraday Support Levels
S1     1,240
S2     1,228-1,221
S3     1,207
Intraday Resistance Levels
R1     1,248
R2     1,259-1,266
R3     1,276

Technical Indicators

Name   Value Action
14DRSI  

49.365

Buy
20-DMA   1247.02 Sell
50-DMA  

1246.45

Sell
100-DMA   1228.42 Buy
200-DMA   1246.60 Sell
STOCH(5,3)   85.200 Sell
MACD(12,26,9)   -7.080 Sell

Silver - XAG

AAFX TRADING

Silver closed up on Wednesday made its intraday high of US$16.84/oz and intraday low of US$16.40/oz. Silver settled by up by 1.325% at US$16.82/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (17.36), 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 positive crossover to show upside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 16.60-15.30 targeting 16.80-17.36 and 17.50-17.70; stop breakage below 15.00. Sell below 16.80-17.70 with stop loss above 17.70; targeting 16.30-16.10 and 15.65-15.30.

 
Intraday  Support Levels
S1     16.60
S2     16.10-15.65
S3     15.30

Intraday  Resistance Levels
R1     16.90-17.30
R2     17.50
R3     17.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.297 Buy
20-DMA   16.87 Sell
50-DMA   17.44 Sell
100-DMA   17.37 Sell
200-DMA   17.69 Sell
STOCH(5,3)   87.817 Buy
MACD(12,26,9)   -0.322 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$49.36/bbl and made an intraday low of US$48.14/bbl and settled up by 1.249% at US$48.20/bbl on session close.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 49.24 which is a major resistance and breakage above will call for 50.30-51.00. MACD is below 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 48.40-50.10 with stop loss at 50.10; targeting 48.00-47.15 and 46.50-46.00. Buy above 48.00-46.00 with risk daily closing below 46.00 and targeting 49.20-50.10 and 50.70-51.40.

 
Intraday Support Levels
S1     48.00
S2     47.15-46.50
S3     45.40

Intraday Resistance Levels
R1     48.40-48.90
R2     49.20
R3     50.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.036 Sell
20-DMA   48.17 Sell
50-DMA   49.40 Sell
100-DMA   51.31 Sell
200-DMA   49.51 Sell
STOCH(5,3)   62.771 Sell
MACD(12,26,9)   -0.684 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.0972/EUR and made an intraday high of US$1.0969/EUR and settled the day up by 0.975% at US$1.1081/EUR on session close.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0702), 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 oversold territory and giving buy crossovers to signal for bullish 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 1.1100-1.1260 targeting 1.1054-1.1000-1.0955 and 1.0900-1.0840 with stop-loss at daily closing above 1.1110. Buy above 1.1100-1.0900 with risk below 1.0900 targeting 1.0955-1.1000 and 1.1055-1.1120.

 
Intraday Support Levels
S1     1.1054
S2     1.1000-1.0955
S3     1.0900

Intraday  Resistance Levels
R1     1.1100-1.1130
R2     1.1200
R3     1.1260

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.477 Buy
20-DMA   1.0909 Buy
50-DMA   1.0780 Buy
100-DMA   1.0700 Buy
200-DMA   1.0824 Buy
STOCH(5,3)   90.982 Buy
MACD(12,26,9)   0.0073 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2914/GBP and made an intraday high of US$1.2956/GBP and settled the day up by 0.162% at US$1.2914/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 negative crossover to confirm bearish 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 1.2880-1.2840 and 1.2775-1.2700, breakage above 1.3100 look for further upside with 1.3150 as targets. Buy above 1.2900-1.2705 with stop loss closing below 1.2700 targeting 1.2950-1.3015 and 1.3070-1.3100.

 
Intraday Support Levels
S1     1.2900-1.2840
S2     1.2770
S3     1.2705

Intraday Resistance Levels
R1     1.2950
R2     1.3015-1.3070
R3     1.3100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

60.662

Buy
20-DMA   1.2886 Buy
50-DMA   1.2609 Buy
100-DMA   1.2500 Buy
200-DMA   1.2593 Buy
STOCH(5,3)   41.849 Sell
MACD(12,26,9)   0.0084 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY112.92/USD and made an intraday high of JPY113.78/USD and settled the day down by 0.588% at JPY113.09/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 sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Buy

Long positions above 112.00-109.70 with targets of 112.60-113.20 and 114.60-115.30-116.00 with stop below 116.40. Sell below 112.60-116.00 with risk above 116.00 targeting 112.00-111.40 and 110.50-109.70.

 
Intraday Support Levels
S1     112.00-111.40
S2     111.10
S3     110.50-109.70

INTRADAY RESISTANCE LEVELS
R1     112.60-113.20
R2     114.60
R3     115.30-116.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.426 Buy
20-DMA   112.12 Buy
50-DMA   111.65 Buy
100-DMA   112.87 Sell
200-DMA   109.67 Buy
STOCH(9,6)   18.295 Sell
MACD(12,26,9)   0.654 Sell

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