AAFX TRADING

Daily Market Lookup

  • Concerns about a Greek bailout, early Italian elections and comments by the European Central Bank chief about the need for continued stimulus all kept the euro under pressure on Tuesday. European geopolitical fears sapped risk appetite, weighing on Asian stocks and lifting safe havens including the yen and gold, though trading was thin with several markets closed for holidays. James Woods, global investment analyst at Rivkin Securities in Sydney, attributed most of the currency's decline on Tuesday to a German press report saying Athens may opt out of its next bailout payment if creditors cannot strike a debt relief deal. Euro zone finance ministers failed to agree with the International Monetary Fund on Greek debt relief or to release new loans to Athens last week, but did come close enough to aim to do both at their June meeting. Comments by former Italian Prime Minister Matteo Renzi on Sunday in favor of holding an election at the same time as Germany's in September also pulled the euro lower. Sterling retreated after British Prime Minister Theresa May's lead over the opposition Labour Party dropped to 6 percentage points in the latest poll to show a tightening race since the Manchester bombing and a U-turn over social care plans. Markets are also awaiting economic indicators including French first quarter gross domestic product, German inflation data for May, and U.S. inflation for April later in the session.
  • The dollar firmed against a basket of currencies on Tuesday as the euro and sterling were pressured by political uncertainties in the UK and eurozone, even as it surrendered ground against the perceived safe-haven yen. U.S. and UK markets were closed for holidays on Monday, giving investors fewer directional clues to follow. British Prime Minister Theresa May's lead over the opposition Labour Party dropped to 6% in a poll published on Tuesday, the latest to show a shrinking lead for the ruling Conservatives ahead of June 8 elections since the Manchester terrorist attack. European Central Bank President Mario Draghi failed to give the euro much help on Monday, citing improved growth but repeated the need for "substantial" stimulus as inflation remained subdued. Markets are mostly pricing in the possibility that the U.S. central bank will raise interest rates by a quarter point to 1.00-1.25% at its June 13-14 policy meeting, with attention turning to clues on the timing of when the Federal Reserve intends to begin paring its $4.5 trn balance sheet. Data released early in the session showed labor demand in Japan rose to its strongest in more than 40 years while the unemployment rate held steady at a two-decade low last month, offering hope that a tight labor market will eventually spark a turnaround in weak consumer spending and inflation.
  • Gold gained in Asia on Tuesday in cautious trade as investors awaited fresh China data points for the global metals complex. Tim Condon of ING Markets said the official manufacturing PMI for May is due tomorrow at 9:00 am local time with a consensus forecast of 51.0 (prior 51.2). Market players are looking ahead to this week's U.S. employment report on Friday for further signs of the Federal Reserve's likely rate hike trajectory through the end of the year. Besides the monthly jobs report, this week's holiday-shortened calendar also features U.S. data on manufacturing and service sector growth, consumer confidence, auto sales, personal spending, core PCE inflation, as well as monthly trade figures. However, market players are no longer convinced that the Fed will be able to raise rates two more times this year, with odds for a second hike by December currently at about 35%. The median Fed policymaker forecast is for two more rate increases by year-end. But a recent run of disappointing U.S. economic data combined with signs of deepening political turmoil in the White House raised doubts over the Fed's ability to raise rates as much as it would like before the end of the year. 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. Investors appear to have shrugged off any geopolitical worries stemming from yet another missile test carried out by North Korea on Monday. North Korea fired what appeared to be a short-range ballistic missile that landed in the sea off its east coast, South Korea's military said. It was the ninth missile the hermit state has tested this year, as it faces increasing pressure from the U.S. and historical ally China over its missile testing program.
  • Oil prices rose slightly on Monday, barely paring last week's steep losses with the market remaining cautious as increases in U.S. drilling activity have undercut an OPEC-led push to tighten supply. Trading was subdued due to public holidays in China, the United States and Britain. The market remains uncertain about whether the extension of output cuts by OPEC and other producing countries will be enough to support prices. The OPEC and some non-OPEC producers pledged last week to extend production cuts of around 1.8 mn bpd until March 2018. Nine months of current production levels is not going to be enough to meet OPEC's goal of balancing supply, which is limiting price gains, he added.

 

 
Intraday RESISTANCE LEVELS
30th May 2017 R1 R2 R3
GOLD-XAU 1,270-1,276 1,284 1,290
Silver-XAG 17.50-17.70 18.10 18.50
Crude Oil 50.10-51.00 51.60 52.50
EURO/USD 1.1170 1.1200 1.1260-1.1295
GBP/USD 1.2900-1.2970 1.3015 1.3100
USD/JPY 111.00 111.50 112.00-112.60

Intraday SUPPORTS LEVELS
30th May 2017 S1 S2 S3
GOLD-XAU 1,260-1,252 1,247 1,241
Silver-XAG 17.20-16.90 16.60 16.10-15.65
Crude Oil 49.00 48.40-47.70 46.95
EURO/USD 1.1100 1.1055-1.0990 1.0930
GBP/USD 1.2800 1.2770-1.2700 1.2620
USD/JPY 110.50-109.70 109.00 108.55

Intra-Day Strategy (30th 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 1266.70/oz and intraday low of US$1264.88/oz. Gold down by 0.0859% at US$1267.79/oz.

Technicals in Focus:

In daily charts, prices are below 200DMA (1244) and breakage above will call for 1292-1300. MACD is below zero line and histograms are decreasing ktrend 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 positive crossover to confirm bearish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1258-1276 keeping stop loss closing above 1284 and targeting 1247-1241 and 1228-1221. Buy above 1247-1207 with risk below 1207, targeting 1254-1264-1270 and 1276-1284.

 
Intraday Support Levels
S1     1,260-1,252
S2     1,247
S3     1,241
Intraday Resistance Levels
R1     1,270-1,276
R2     1,284
R3     1,290

Technical Indicators

Name   Value Action
14DRSI  

58.567

Buy
20-DMA   1242.80 Buy
50-DMA  

1254.21

Buy
100-DMA   1236.57 Buy
200-DMA   1243.34 Buy
STOCH(5,3)   77.305 Buy
MACD(12,26,9)   2.953 Sell

Silver - XAG

AAFX TRADING

Silver closed up on made its intraday high of US$17.42/oz and intraday low of US$17.30/oz. Silver settled by up by 0.346% at US$17.38/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (17.44), 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 overbought 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 17.20-15.30 targeting 17.50-17.70 and 18.10; stop breakage below 15.00. Sell below 17.50-18.50 with stop loss above 18.50; targeting 17.20-16.90-16.30 and 16.10-15.65.

 
Intraday  Support Levels
S1     17.20-16.90
S2     16.60
S3     16.10-15.65

Intraday  Resistance Levels
R1     17.50-17.70
R2     18.10
R3     18.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.299 Buy
20-DMA   16.73 Buy
50-DMA   17.43 Sell
100-DMA   17.44 Sell
200-DMA   17.58 Sell
STOCH(5,3)   94.426 Buy
MACD(12,26,9)   0.0145 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$50.28/bbl and made an intraday low of US$49.48/bbl and settled down by 0.140% at US$49.98/bbl on session close.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 49.74 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 overbought region and giving positive crossover for confirmation of bullish 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 50.10-52.50 with stop loss at 52.50; targeting 49.00-48.40-47.70 and 46.5-46.00. Buy above 49.00-46.95 with risk daily closing below 46.90 and targeting 50.10-51.00 and 51.70-52.20.

 
Intraday Support Levels
S1     49.00
S2     48.40-47.70
S3     46.95

Intraday Resistance Levels
R1     50.10-51.00
R2     51.60
R3     52.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.520 Sell
20-DMA   48.71 Sell
50-DMA   49.63 Sell
100-DMA   51.05 Sell
200-DMA   49.76 Sell
STOCH(5,3)   44.240 Buy
MACD(12,26,9)   0.208 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1161/EUR and made an intraday high of US$1.1189/EUR and settled the day down by 0.035% at US$1.1164/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 sell 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 1.1170-1.1300 targeting 1.1100-1.1054 and 1.0990 with stop-loss at daily closing above 1.1100. Buy above 1.1100-1.0930 with risk below 1.0930 targeting 1.1170-1.1200 and 1.1260-1.1300-1.1365.

 
Intraday Support Levels
S1     1.1100
S2     1.1055-1.0990
S3     1.0930

Intraday  Resistance Levels
R1     1.1170
R2     1.1200
R3     1.1260-1.1295

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.015 Buy
20-DMA   1.1057 Buy
50-DMA   1.0868 Buy
100-DMA   1.0761 Buy
200-DMA   1.0820 Buy
STOCH(5,3)   7.267 Sell
MACD(12,26,9)   0.0096 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2785/GBP and made an intraday high of US$1.3014/GBP and settled the day up by 0.273% at US$1.2939/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 1.2900-1.3100 with targets at 1.2800-1.2775 and 1.2700-1.2620, breakage above 1.3100 look for further upside with 1.3150 as targets. Buy above 1.2800-1.2620 with stop loss closing below 1.2620 targeting 1.2900-1.2970 and 1.3015-1.3070-1.3100.

 
Intraday Support Levels
S1     1.2800
S2     1.2770-1.2700
S3     1.2620

Intraday Resistance Levels
R1     1.2900-1.2970
R2     1.3015
R3     1.3100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

45.880

Buy
20-DMA   1.2739 Buy
50-DMA   1.2732 Buy
100-DMA   1.2565 Buy
200-DMA   1.2587 Buy
STOCH(5,3)   16.050 Sell
MACD(12,26,9)   0.0030 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY111.14/USD and made an intraday high of JPY111.46/USD and settled the day up by 0.0359% at JPY111.23/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 111.50-109.20 with targets of 112.00-112.60 and 113.20-114.60 with stop below 114.60. Sell below 112.00-113.20 with risk above 113.20 targeting 111.10-110.50 and 109.70-109.20.

 
Intraday Support Levels
S1     110.50-109.70
S2     109.00
S3     108.55

INTRADAY RESISTANCE LEVELS
R1     111.00
R2     111.50
R3     112.00-112.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.655 Buy
20-DMA   112.33 Sell
50-DMA   111.21 Buy
100-DMA   112.38 Sell
200-DMA   110.15 Buy
STOCH(9,6)   24.993 Sell
MACD(12,26,9)   -0.1095 Sell

AAFX TRADING
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