AAFX TRADING

Daily Market Lookup

  • The dollar and U.S. bond yields rose on Thursday after President Donald Trump proposed the biggest U.S. tax overhaul in three decades and as strong U.S. economic data added to the case for a rate hike by the Federal Reserve later this year. Trump offered to lower corporate income tax rates, cut taxes for small businesses and reduce the top income tax rate for individuals. Also helping to boost the dollar, the plan included lower one-time low tax rates for companies to repatriate profits accumulated overseas, which analysts say would lead to a temporary phase of sizable dollar buying. The proposal faces an uphill battle in Congress, however, with Trump’s own party divided, and the plan already prompting criticism that it favors the rich and companies and could add trillions of dollars to the deficit. The dollar also shot up to a 2-1/2-month high of 113.26 yen JPY= the previous day before stepping back to 112.88 yen. Comments from Fed Chair Janet Yellen that the Fed needs to continue with gradual rate hikes have cemented expectations for a year-end policy tightening. New orders for key U.S.-made capital goods increased more than expected in August, helping to boost optimism on the U.S. economy. Yields on longer-dated bonds soared as Trump’s tax proposal stoked worries about fiscal deterioration. U.S. municipal bonds were also sold for the same reason.
  • The dollar hit a one-month high against a basket of currencies on Thursday, underpinned by hopes that U.S. President Donald Trump’s administration may be making progress on tax reforms. It touched a high of 93.613 at one point, its strongest level since Aug. 23. Trump on Wednesday proposed the biggest U.S. tax overhaul in three decades, offering to cut taxes for most Americans but prompting criticism that the plan favours the rich and companies and could add trillions of dollars to the deficit. The proposal faces an uphill battle in the U.S. Congress, with Trump’s own Republican Party divided over it and Democrats hostile. But the unveiling of the plan, coupled with upbeat U.S. durable goods orders, helped give an added lift to the greenback, which has benefited from rekindled expectations that the Federal Reserve will raise interest rates again by year-end. Overnight, the dollar rose against a basket of major currencies, after President Trump and Republican leaders on Wednesday revealed details of a plan for tax reform which helped offset earlier weakness following a mixed bag of economic reports. Republicans in the U.S. Congress and the White House unveiled plans to change America’s tax code in a proposal that slashes taxes on businesses and the wealthy, lowering the corporate rate from 35% to 20%. Investors, however, mulled over the lack of detail on how on the tax reform will be funded, fueling fears that key elements missing from the plan could invite pressure from support industry groups and lobbyists. The framework for tax reform came just hours after a pair of mixed economic reports forced the greenback to retreat from a 1-month high. The Commerce Department said on Wednesday non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rose 0.9 % last month after an upwardly revised 1.1% increase in July. The housing sector, meanwhile, continued to weaken as the National Association of Realtors’ pending home sales fell 2.6% to 106.3 in August. That was the lowest reading since January 2016.
  • Oil prices fell on Thursday, with U.S. crude giving up some of the previous session's gains that were driven by a surprise fall in inventories, while Brent moved further away from recent 26-month highs. U.S. crude inventories fell 1.8 million barrels last week, the U.S. Energy Department said on Wednesday, versus forecasts for a 3.4 million-barrel build. The crude draw provided some support to oil prices as refiners came back online following Hurricane Harvey last month, but gasoline stocks surprisingly rose and stocks of distillates were down by less than anticipated. The International Energy Agency earlier this month raised its 2017 global oil demand growth estimate to 1.6 million bpd from 1.5 million bpd, pointing to stronger-than-expected demand growth in the United States and Europe. Still, U.S. crude production rose to 9.55 million bpd last week, higher than before Harvey hit the Gulf Coast. That complicates efforts by the OPEC and other major producers to push oil higher through output curbs, as every hike in price encourages more U.S. production. Gasoline inventories, one of the products that crude is refined into, rose by roughly 1.107m barrels, missing expectations of a draw of 921K barrels while distillate stockpiles fell by 814Kbarrels, below expectations of a decline of 2.2m barrels The draw in U.S. crude inventories comes against a three-week build of stockpiles as refinery shutdowns due to Hurricane Harvey weighed on demand for crude oil, the primary input at refiners. The lull in refinery activity has since improved while the widening spread, between brent and crude oil prices to nearly $6 continued to drive exports, underpinning crude oil prices. The U.S. exported a record 1.5m barrels per day of crude oil last week, the EIA said Wednesday, a sum larger than the output of several Opec member countries.

 

 
Intraday RESISTANCE LEVELS
28th September 2017 R1 R2 R3
GOLD-XAU 1,288-1,294 1,300 1,311-1,319
Silver-XAG 17.00-17.50 18.00 18.35-19.00
Crude Oil 52.50-53.00 53.70 54.40
EURO/USD 1.1770 1.1825-1.1890 1.1950
GBP/USD 1.3400-1.3450 1.3500 1.3610-1.3700
USD/JPY 113.60-114.00 114.50 115.00

Intraday SUPPORTS LEVELS
28th September 2017 S1 S2 S3
GOLD-XAU 1,279-1,271 1,263 1,252
Silver-XAG 16.70-16.35 16.00 15.60
Crude Oil 52.00-51.50 51.00 50.10-49.60
EURO/USD 1.1700-1.1660 1.1600 1.1555
GBP/USD 1.3350-1.3300 1.3260 1.3200
USD/JPY 112.80-112.30 111.90 111.50-111.10

Intra-Day Strategy (28th September 2017)
GOLD-XAU Neutral
Silver-XAG Neutral
Crude Oil Neutral
EUR/USD Neutral to Sell
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Wednesday made its intraday high of US$1296.09/oz and low of US$1281.38/oz. Gold was down by 0.858% at US$1282.67/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1267) and breakage below will call for 1234-1224. MACD is below zero line and histograms are increasing trend and it will bring upward stance in the upcoming sessions. RSI is in overbought region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving positive crossover to confirm bearish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1288-1319 keeping stop loss closing above 1319 and targeting 1284-1273 and 1263-1252. Buy above 1284-1263 with risk below 1263, targeting 1288-1294-1300-1311 and 1319-1324.

 
Intraday Support Levels
S1     1,279-1,271
S2     1,263
S3     1,252
Intraday Resistance Levels
R1     1,288-1,294
R2     1,300
R3     1,311-1,319

Technical Indicators

Name   Value Action
14DRSI  

39.853

Buy
20-DMA   1316.74 Sell
50-DMA  

1293.73

Sell
100-DMA   1271.17 Buy
200-DMA   1247.72 Buy
STOCH(5,3)   8.285 Sell
MACD(12,26,9)   -2.691 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$16.89/oz and low of US$16.70/oz. Silver settled down by 0.297% at US$16.74/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (17.10), 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 16.50-15.65 targeting 17.00-17.30-17.70 and 18.00-18.35; stop breakage below 16.00. Sell below 17.00 -19.30 with stop loss above 19.30; targeting 16.80-16.50 and 16.00-15.60.

 
Intraday  Support Levels
S1     16.70-16.35
S2     16.00
S3     15.60

Intraday  Resistance Levels
R1     17.00-17.50
R2     18.00
R3     18.35-19.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.113 Buy
20-DMA   17.45 Sell
50-DMA   17.09 Sell
100-DMA   16.88 Sell
200-DMA   17.10 Sell
STOCH(5,3)   4.701 Sell
MACD(12,26,9)   -0.110 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$52.32/bbl, intraday low of US$51.62/bbl and settled down by 0.096% to close at US$52.02/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 200DMA i.e. 49.60 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 52.50-54.40 with stop loss at 54.40; targeting and 52.00-51.50 and 50.10-49.60-49.20. Buy above 52.00-49.60 with risk daily closing below 49.60 and targeting 51.00-51.50 and 52.00-52.50.

 
Intraday Support Levels
S1     52.00-51.50
S2     51.00
S3     50.10-49.60

Intraday Resistance Levels
R1     52.50-53.00
R2     53.70
R3     54.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.578 Sell
20-DMA   49.76 Buy
50-DMA   48.78 Buy
100-DMA   47.73 Buy
200-DMA   49.61 Sell
STOCH(5,3)   84.447 Sell
MACD(12,26,9)   1.084 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1716/EUR, high of US$1.1794/EUR and settled the day down by 0.407% to close at US$1.1743/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.1937), 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 neutral 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 1.1770-1.1950 targeting 1.1700-1.1660 and 1.1600-1.1555 with stop-loss at daily closing above 1.2100. Buy above 1.1700-1.1555 with risk below 1.1550 targeting 1.1770-1.1825 and 1.1890-1.1950-1.1990.

 
Intraday Support Levels
S1     1.1700-1.1660
S2     1.1600
S3     1.1555

Intraday  Resistance Levels
R1     1.1770
R2     1.1825-1.1890
R3     1.1950

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.935 Buy
20-DMA   1.1906 Buy
50-DMA   1.1837 Buy
100-DMA   1.1553 Buy
200-DMA   1.1115 Buy
STOCH(5,3)   8.754 Sell
MACD(12,26,9)   -0.0081 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3363/GBP, high of US$1.3460/GBP and settled the day by down by 0.542% to close at US$1.3456/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 20DMA (1.3306) 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 1.3450-1.3770 with targets at 1.3400-1.3350 and 1.3270-1.3200. Buy above 1.3400-1.3300 with stop loss closing below 1.3200 targeting 1.3400-1.3450-1.3500 and 1.3610-1.3700.

 
Intraday Support Levels
S1     1.3350-1.3300
S2     1.3260
S3     1.3200

Intraday Resistance Levels
R1     1.3400-1.3450
R2     1.3500
R3     1.3610-1.3700

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

57.331

Buy
20-DMA   1.3306 Buy
50-DMA   1.3113 Buy
100-DMA   1.2997 Buy
200-DMA   1.2739 Buy
STOCH(5,3)   11.726 Sell
MACD(12,26,9)   0.0119 Buy

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY112.16/USD and made an intraday high of JPY113.24/USD and settled the day up by 0.534% at JPY112.81/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (112.15), 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 Sell

Sell below 113.00-114.50 with risk above 114.50 targeting 112.80-112.30 and 111.50-111.0-110.35. Long positions above 112.80-111.10 with targets of 113.60-114.00 and 114.50-115.00 with stop below 111.00.

 
Intraday Support Levels
S1     112.80-112.30
S2     111.90
S3     111.50-111.10

INTRADAY RESISTANCE LEVELS
R1     113.60-114.00
R2     114.50
R3     115.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.456 Buy
20-DMA   110.73 Buy
50-DMA   110.36 Buy
100-DMA   111.05 Buy
200-DMA   112.04 Sell
STOCH(9,6)   77.338 Buy
MACD(12,26,9)   0.730 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING