AAFX TRADING

Daily Market Lookup

  • Dollar hoarded hefty gains on Wednesday after strong U.S. retail data put a Federal Reserve rate hike back on the agenda, while Asia stocks inched ahead as tensions in the Korean peninsula simmered down a little. North Korean leader Kim Jong Un has delayed a decision on firing missiles towards Guam while he waits to see what the United States does, as Washington said any dialogue was up to Kim. The economic news, however, was much more emphatic, with U.S. retail sales rising the most in seven months in July as consumers spent more on 10 of 13 retail sectors. Importantly, upward revisions to sales for both May and June countered concerns that consumption had entered a downtrend and lifted the outlook for economic growth. Sterling also slumped after UK inflation numbers came in below forecast, breaching key support levels against both the euro and dollar. All that action paled in comparison to the digital currency Bitcoin, which has surged over $1,200 so far this month to reach $4,100 amid fevered speculative demand. U.S. retail sales data kept alive the chance of another Federal Reserve interest rate hike this year. Minutes from the Fed's July meeting will be released later on Wednesday, and will be watched for clues on the timing of rate hikes as well as whether the Fed is likely to announce a reduction in its balance sheet at its September meeting. He said there was a still a chance for further dollar gains if market participants began to price in higher probability of a rate increase. Fed fund futures are now showing a slightly better-than-even chance for a hike this year. Easing fears of armed conflict between the United States and North Korea also prompted investors to buy back riskier assets they had sold last week as fiery rhetoric between the two countries escalated. On Tuesday, state media said North Korean leader Kim Jong Un has postponed a missile strike toward the U.S. territory of Guam, which prompted investors to pare holdings of perceived safe-haven assets such as the yen, the Swiss franc and U.S. Treasuries. U.S. retail sales jumped 0.6 percent in July, handily beating economists' estimate of a 0.4 percent reading, to post their biggest gain in seven months as consumers bought more cars and increased discretionary spending. An unexpectedly strong rise in an index on manufacturing activity in New York state from the New York Federal Reserve also cheered dollar bulls. The index rose to 25.2 points in August, its highest level since September 2014. The eurozone economy has strengthened, partly due to a relatively weak euro, so eventually the European Central Bank will grow uncomfortable with a rising currency, he said.
  • Gold prices fell on Tuesday, as U.S-North Korea tensions eased, after North Korean leader Kim Jong Un was reported to have delayed a decision on firing missiles towards the U.S. pacific territory of Guam. Gold prices struggled to shake off losses, as demand for safe-haven assets cooled, following reports from North Korean state media on Tuesday that leader Kim Jong Un had delayed a decision on firing missiles towards the U.S. pacific territory of Guam, suggesting that his earlier threats were rhetorical. The minutes from the Federal Reserve’s July policy meeting due Wednesday, however, could stem losses in the yellow metal should the minutes reveal fed members were more dovish on monetary policy than initially believed. At its policy meeting in July, Fed members voted to keep rates unchanged, citing concerns over the slowdown in inflation. The central bank, however, signalled that it would begin tapering its $4.5tn balance sheet “relatively soon”. Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
  • Oil prices edged up on Wednesday on a fall in U.S. crude inventories, although markets were still being weighed down by general oversupply. U.S. crude inventories fell by 9.2 million barrels in the week to Aug. 11 to 469.2 million, industry group the American Petroleum Institute said on Tuesday. That compared with analyst expectations for a decrease of 3.1 million barrels. However, gasoline stocks climbed by 301,000 barrels, compared with analyst expectations in a Reuters poll for a 1.1 million barrel decline. Official EIA data will be published late on Wednesday. More broadly, analysts said ample supplies were preventing prices from moving much higher. The OPEC together with non-OPEC producers like Russia has pledged to restrict output by 1.8 mn bpd between January this year and March 2018. Offsetting much of that effort, however, U.S. oil production has soared by almost 12 percent since mid-2016 to 9.42 million bpd. On the demand side, analysts also see a gradual slowdown in consumption growth as gasoline demand peaks in the United States due to improving fuel efficiency and the rise of electric vehicles, while China's voracious oil thirst also starts to taper off. The crude forward price curve shows that the market condition known as contango, when it is profitable to store oil for later sale and which is seen as an indicator of oversupply, no longer applies. Yet neither is the curve in backwardation, which would make it profitable to sell oil immediately and which is seen as a healthy market for producers.

 

 
Intraday RESISTANCE LEVELS
16th August 2017 R1 R2 R3
GOLD-XAU 1,279 1,289-1,296 1,304
Silver-XAG 17.35-17.70 18.35 18.60
Crude Oil 48.00-48.50 49.20 49.80
EURO/USD 1.1770-1.1800 1.1840 1.1900
GBP/USD 1.2960-1.3000 1.3140-1.3200 1.3140-1.3200
USD/JPY 110.90-111.60 112.30 113.00

Intraday SUPPORTS LEVELS
16th August 2017 S1 S2 S3
GOLD-XAU 1,270-1,260 1,254 1,246
Silver-XAG 16.50 16.00 15.60-15.30
Crude Oil 47.50 47.00-46.10 45.20
EURO/USD 1.1720 1.1680-1.1610 1.1680-1.1610 1.1500
GBP/USD 1.2900-1.2825 1.2760 1.2700
USD/JPY 110.50-109.50 109.00 108.50

Intra-Day Strategy (16th August 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 Tuesday on and made its intraday high of 1281.91/oz and intraday low of US$1267.17/oz. Gold down by 0.811% at US$1271.24/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1230) and breakage below will call for 1234-1224. 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 bullish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1279-1304 keeping stop loss closing above 1311 and targeting 1270-1264 and 1254-1249. Buy above 1270-1230 with risk below 1230, targeting 1279-1288 and 1296-1305.

 
Intraday Support Levels
S1     1,270-1,260
S2     1,254
S3     1,246
Intraday Resistance Levels
R1     1,279
R2     1,289-1,296
R3     1,304

Technical Indicators

Name   Value Action
14DRSI  

57.412

Buy
20-DMA   1266.06 Buy
50-DMA  

1251.09

Buy
100-DMA   1254.79 Buy
200-DMA   1229.73 Buy
STOCH(5,3)   48.560 Buy
MACD(12,26,9)   8.759 Buy

Silver - XAG

AAFX TRADING

Silver closed up Tuesday on made its intraday high of US$17.05/oz and intraday low of US$16.56/oz. Silver settled down by 0.240% at US$16.61/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (17.02), 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 16.50-14.90 targeting 17.35-17.70 and 18.35-18.60; stop breakage below 15.00. Sell below 17.35-18.60 with stop loss above 18.60; targeting 16.50-16.00-15.60 and 15.30-14.90.

 
Intraday  Support Levels
S1     16.50
S2     16.00
S3     15.60-15.30

Intraday  Resistance Levels
R1     17.35-17.70
R2     18.35
R3     18.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.632 Buy
20-DMA   16.34 Buy
50-DMA   16.58 Buy
100-DMA   17.00 Buy
200-DMA   17.08 Buy
STOCH(5,3)   22.051 Sell
MACD(12,26,9)   0.0183 Buy Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US47.86/bbl, intraday low of US$47.00/bbl and settled down by 0.400% to close at US$47.65/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 49.77 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 neutral 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 48.00-50.00 with stop loss at 50.00; targeting 48.00-47.50 and 47.00-46.10. Buy above 47.50-45.20 with risk daily closing below 45.00 and targeting 48.00-48.50 and 49.20-49.80.

 
Intraday Support Levels
S1     47.50
S2     47.00-46.10
S3     45.20

Intraday Resistance Levels
R1     48.00-48.50
R2     49.20
R3     49.80

TECHNICAL INDICATORS
Name   Value Action
14DRSI   48.892 Sell
20-DMA   48.48 Sell
50-DMA   46.46 Sell
100-DMA   48.05 Sell
200-DMA   49.53 Sell
STOCH(5,3)   13.222 Sell
MACD(12,26,9)   0.751 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1686/EUR, high of US$1.1792/EUR and settled the day down by 0.390% to close at US$1.1733/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.1732), which become immediate support level, break below will target 1.1700.-1.1600. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving positive 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 1.1770-1.1900 targeting 1.1720-1.1680 and 1.1620-1.1500 with stop-loss at daily closing above 1.1900. Buy above 1.1720-1.1500 with risk below 1.1500 targeting 1.1770-1.1840-1.1900 and 1.1980-1.2080.

 
Intraday Support Levels
S1     1.1720
S2     1.1680-1.1610
S3     1.1680-1.1610 1.1500

Intraday  Resistance Levels
R1     1.1770-1.1800
R2     1.1840
R3     1.1900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.460 Buy
20-DMA   1.1750 Buy
50-DMA   1.1490 Buy
100-DMA   1.1207 Buy
200-DMA   1.0917 Buy
STOCH(5,3)   39.903 Buy
MACD(12,26,9)   0.0078 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.2845/GBP, high of US$1.2969/GBP and settled the day by down by 0.725% to close at US$1.2868/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 200DMA (1.2570) 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 1.2960-1.3200 with targets at 1.2900-1.2825 and 1.2760-1.2700, breakage above 1.3200 look for further upside with 1.3300 as targets. Buy above 1.2900 -1.3300 with stop loss closing below 1.3300 targeting 1.2960-1.3000 and 1.3090-1.3140-1.3220.

 
Intraday Support Levels
S1     1.2900-1.2825
S2     1.2760
S3     1.2700

Intraday Resistance Levels
R1     1.2960-1.3000
R2     1.3140-1.3200
R3     1.3140-1.3200

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

44.652

Buy
20-DMA   1.3055 Buy
50-DMA   1.2935 Buy
100-DMA   1.2858 Buy
200-DMA   1.2637 Buy
STOCH(5,3)   34.910 Sell
MACD(12,26,9)   0.00063 Buy

USD/JPY

AAFX TRADING

USD/JPY Tuesday to made intra‐day low of JPY109.59/USD and made an intraday high of JPY110.84/USD and settled the day up by 0.958% at JPY110.65/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 bullish stance.

Trading Strategy: Neutral to Buy

Long positions above 110.00-108.05 with targets of 110.90-111.60 and 112.00-113.00 with stop below 108.00. Sell below 110.90-113.00 with risk above 113.00 targeting 110.00-109.5-109.10 and 108.50-108.05.

 
Intraday Support Levels
S1     110.50-109.50
S2     109.00
S3     108.50

INTRADAY RESISTANCE LEVELS
R1     110.90-111.60
R2     112.30
R3     113.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   48.154 Buy
20-DMA   110.57 Sell
50-DMA   111.43 Sell
100-DMA   111.27 Sell
200-DMA   112.52 Sell
STOCH(9,6)   74.836 Buy
MACD(12,26,9)   -0.491 Sell

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