AAFX TRADING

Daily Market Lookup

  • The dollar edged up on Monday, but remained not far from the seven-month low it plumbed against a currency basket after disappointing U.S. employment data prompted investors to pare back expectations of U.S. Federal Reserve rate hikes. Sterling slipped, under pressure after the third terrorist attack in Britain in less than three months killed at least seven people on Saturday. The attack came days ahead of Thursday's UK election, in which polls show British Prime Minister Theresa May's lead over the opposition Labour Party has narrowed but is still intact. U.S. nonfarm payrolls rose by 138,000 in May, Labor Department data showed on Friday, suggesting the labor market was losing momentum despite the unemployment rate falling to a 16-year low of 4.3 percent. Economists polled by Reuters had predicted an increase of 185,000. While market participants still expect the U.S. central bank to raise interest rates this month, many expect a more dovish course for the second half of this year. "The pessimistic story of the jobs data should weigh on the dollar as the Fed is still expected to hike rates in June, but most market participants believe it won't hike for a long time after that, and maybe not in September or December," said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo. Net long positions on the U.S. dollar fell sharply in the latest week through May 30 to their lowest since September, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday.
  • The World Bank on Sunday maintained its forecast that global growth will improve to 2.7 percent this year, citing a pickup in manufacturing and trade, improved market confidence and a recovery in commodity prices. The update of the multilateral development lender's Global Economic Prospects report marked the first time in several years that its June forecasts were not reduced from those published in January due to rising growth risks. The World Bank's 2017 global growth forecast of 2.7 percent compares to its 2.4 percent estimate for 2016, a figure that was increased by a tenth of a percentage point since January. The World Bank said advanced economies were showing signs of improvement, especially Japan and Europe, while the seven largest emerging markets - China, Brazil, Mexico, India, Indonesia, Turkey and Russia - were again helping to drive global growth. The World Bank said U.S. growth also is improving but it shaved 0.1 percentage point off its forecast for 2017 to 2.1 percent after weak growth early in the year caused by a pullback in consumer spending it viewed as temporary. It slightly lifted its 2018 U.S. growth forecast to 2.2 percent.
  • Activity in China's services sector expanded at the fastest pace in fourth months in May thanks to a surge in new orders, a private business survey showed, helping to offset worries about unexpected weakness in manufacturing. The Caixin/Markit services purchasing managers' index (PMI) rose to 52.8 in May from April's 51.5, breaking a four-month decline and marking the highest reading since January. There was no breakdown by business segment in the survey. The new orders sub-index rose to 53.5 in May from April's 53.0, signaling the strongest customer demand since December.
  • Oil prices rose sharply in European trading on Monday, after Saudi Arabia and three other countries severed diplomatic ties with Qatar, fueling concerns over geopolitical instability in the Middle East. Saudi Arabia, Egypt, the United Arab Emirates and Bahrain severed their ties with Qatar on Monday, accusing it of supporting terrorism, in an unprecedented breach between the most powerful members of the Gulf Cooperation Council. The coordinated move dramatically escalates a simmering dispute over Qatar's support for the Muslim Brotherhood, the world's oldest Islamist movement, and affects some of the world's biggest oil and gas exporters. Qatar, a member of the OPEC, is the biggest supplier of LNG and a major seller of condensate - a low-density liquid fuel and refining product derived from natural gas. A split between Doha and its closest allies can have repercussions around the Middle East where Gulf states have used their financial and political power to influence events in Libya, Egypt, Syria, Iraq and Yemen. Market participants are sensitive to Middle East tensions because they worry about supply disruptions from the region. Oil suffered its largest weekly loss in a month last week, dropping more than 4%, amid growing concern over rising shale production in the U.S Data from energy services company Baker Hughes showed on Friday that U.S. drillers last week added rigs for the 20th week in a row, the longest such streak on record, implying that further gains in domestic production are ahead. The U.S. rig count rose by 11 to 733, extending a year-long drilling recovery to the highest level since April 2015. The increase in U.S. drilling activity and shale production has mostly offset efforts by OPEC and other producers to cut output in a move to prop up the market. Last month, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018. So far, the production-cut agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria, and a relentless increase in U.S. shale oil output.

 

 
Intraday RESISTANCE LEVELS
5th June 2017 R1 R2 R3
GOLD-XAU 1,284-1,290 1,300 1,307
Silver-XAG 17.70-18.05 18.30 18.60
Crude Oil 48.40 49.00 50.10-51.00
EURO/USD 1.1290-1.1370 1.1425 1.1460
GBP/USD 1.2900-1.2970 1.3015 1.3100
USD/JPY 111.10 111.60 112.00-112.60

Intraday SUPPORTS LEVELS
5th June 2017 S1 S2 S3
GOLD-XAU 1,276-1,270 1,260 1,252-1,247
Silver-XAG 17.20-16.90 16.60 16.10-15.65
Crude Oil 47.70-46.95 46.00 45.22
EURO/USD 1.1260 1.1200 1.1100-1.1055
GBP/USD 1.2800 1.2770-1.2700 1.2620
USD/JPY 110.40-109.70 109.00 108.55

Intra-Day Strategy (5th June 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 Friday and made its intraday high of 1279.33/oz and intraday low of US$1259.92/oz. Gold up by 1.067% at US$1278.96/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 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 positive crossover to confirm bearish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1284-1300 keeping stop loss closing above 1284 and targeting 1276-1270 and 1260-1254-1247. Buy above 1276-1247 with risk below 1247, targeting 1284-1290 and 1300-1307.

 
Intraday Support Levels
S1     1,276-1,270
S2     1,260
S3     1,252-1,247
Intraday Resistance Levels
R1     1,284-1,290
R2     1,300
R3     1,307

Technical Indicators

Name   Value Action
14DRSI  

63.512

Buy
20-DMA   1251.84 Buy
50-DMA  

1257.01

Buy
100-DMA   1240.62 Buy
200-DMA   1241.67 Buy
STOCH(5,3)   83.718 Buy
MACD(12,26,9)   6.844 Sell

Silver - XAG

AAFX TRADING

Silver closed up Friday on made its intraday high of US$17.56/oz and intraday low of US$17.11/oz. Silver settled by up by 1.388% at US$17.52/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 17.20-15.65 targeting 17.70-18.05 and 18.30-18.60; 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     17.70-18.05
R2     18.30
R3     18.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.826 Buy
20-DMA   16.95 Buy
50-DMA   17.41 Sell
100-DMA   17.47 Sell
200-DMA   17.54 Sell
STOCH(5,3)   83.219 Buy
MACD(12,26,9)   0.086 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$48.18/bbl and made an intraday low of US$46.72/bbl and settled down by 0.562% at US$47.76/bbl on session close.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 49.76 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 48.40-51.60 with stop loss at 52.00; targeting 47.70-46.5 and 46.00-45.22. Buy above 47.70-46.05 with risk daily closing below 46.90 and targeting 50.10-51.00 and 51.70-52.20.

 
Intraday Support Levels
S1     47.70-46.95
S2     46.00
S3     45.22

Intraday Resistance Levels
R1     48.40
R2     49.00
R3     50.10-51.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.013 Sell
20-DMA   49.04 Sell
50-DMA   49.63 Sell
100-DMA   50.88 Sell
200-DMA   49.77 Sell
STOCH(5,3)   29.682 Sell
MACD(12,26,9)   -0.212 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1204/EUR and made an intraday high of US$1.1284/EUR and settled the day down by 0.615% at US$1.1280/EUR on session close.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.0877), 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 1.1260-1.1425 targeting 1.1260-1.1200 and 1.1100-1.1054 with stop-loss at daily closing above 1.1425. Buy above 1.1260-1.1100 with risk below 1.1100 targeting 1.1290-1.1365 and 1.1425-1.1460.

 
Intraday Support Levels
S1     1.1260
S2     1.1200
S3     1.1100-1.1055

Intraday  Resistance Levels
R1     1.1290-1.1370
R2     1.1425
R3     1.1460

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.507 Buy
20-DMA   1.1121 Buy
50-DMA   1.0905 Buy
100-DMA   1.0787 Buy
200-DMA   1.0821 Buy
STOCH(5,3)   86.747 Buy
MACD(12,26,9)   0.0100 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2844/GBP and made an intraday high of US$1.2903/GBP and settled the day up by 0.046% at US$1.2886/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  

49.721

Buy
20-DMA   1.2913 Buy
50-DMA   1.2770 Buy
100-DMA   1.2595 Buy
200-DMA   1.2582 Buy
STOCH(5,3)   67.050 Buy
MACD(12,26,9)   0.0019 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY110.32/USD and made an intraday high of JPY111.70/USD and settled the day down by 0.853% at JPY110.38/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 110.50-108.55 with targets of 111.10-111.60 and 112.00-112.60-113.20 with stop below 108.50. Sell below 111.10-113.20 with risk above 113.20 targeting 110.50-109.70 and 109.20-108.55.

 
Intraday Support Levels
S1     110.40-109.70
S2     109.00
S3     108.55

INTRADAY RESISTANCE LEVELS
R1     111.10
R2     111.60
R3     112.00-112.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.741 Buy
20-DMA   111.92 Sell
50-DMA   111.18 Buy
100-DMA   112.22 Sell
200-DMA   110.34 Buy
STOCH(9,6)   27.993 Sell
MACD(12,26,9)   -0.288 Sell

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