AAFX TRADING

Daily Market Lookup

  • Asian shares inched slightly higher on Friday, but grappled for firmer leads as speculation about who the next U.S. central bank chief will be kept global investors wary. The dollar buckled and U.S. bond yields dipped after a report that President Donald Trump was leaning toward Jerome Powell as the next chair of the Federal Reserve. Powell is the most dovish among three other Republican candidates. The current chair, Janet Yellen, a Democrat who is seen as a policy dove, is also on Trump’s short list, though few investors expect Trump to nominate a Democrat to the job. The dollar edged up to 112.59 yen JPY=, on track to gain 0.7 percent for the week, after notching a nearly two-week high of 113.145 yen on Thursday, as investors awaited Sunday's Japanese general election. In Europe, shares notched their largest drop in two months on concerns over political upheaval in Spain and after disappointing results from large companies such as Unilever, France’s Publicis and Germany’s Kion. Spain’s central government said on Thursday it would suspend Catalonia’s autonomy and impose direct rule after the region’s leader threatened to go ahead with a formal declaration of independence if Madrid refused to hold talks.
  • The number of Americans filing for unemployment benefits dropped to its lowest level in more than 44-1/2 years last week, pointing to a rebound in job growth after a hurricane-related decline in employment in September. The labor market outlook was also bolstered by another report on Thursday showing a measure of factory employment in the mid-Atlantic region racing to a record high in October. The signs of labor market strength could cement expectations that the Federal Reserve will raise interest rates in December. Initial claims for state unemployment benefits fell 22,000 to a seasonally adjusted 222,000 for the week ended Oct. 14, the lowest level since March 1973, the Labor Department said. But the decrease in claims, which was the largest since April, was probably exaggerated by the Columbus Day holiday on Monday. Claims are declining as the impact of Hurricanes Harvey and Irma washes out of the data. The hurricanes, which lashed Texas, Florida and the Virgin Islands, boosted claims to an almost three-year high of 298,000 at the start of September. A Labor Department official said claims for the Virgin Islands and Puerto Rico continued to be impacted by Irma and Hurricane Maria, which destroyed infrastructure. As a result the Labor Department was estimating claims for the islands. Nonfarm payrolls dropped by 33,000 jobs in September as Hurricanes Irma and Harvey left more than 100,000 restaurant workers temporarily unemployed. The Virgin Islands and Puerto Rico are not included in nonfarm payrolls Economists had forecast claims slipping to 240,000 in the latest week. The dollar briefly pared losses against a basket of currencies after the data. Stocks on Wall Street fell as investors booked profits after a recent rally that lifted shares to record highs. Prices for U.S. Treasuries rose. Improvements in the labor market have been largely due to a recovery that started during former President Barack Obama’s first term. While U.S. stocks have risen in anticipation of President Donald Trump’s tax plans, the administration has yet to enact any significant new economic policies. The labor market is near full employment, with the jobless rate at a more than 16-1/2-year low of 4.2 percent. Tightening labor market conditions likely keep the Fed on track to raise interest in December for a third time this year, even as inflation remains moderate.
  • Oil prices were stable on Friday, supported by signs of tightening supply and demand fundamentals, but a warning about excessive China economic optimism spooked traders and weighed on markets. This was put down to profit-taking following four days of straight gains, but also to a broader market slump which spooked traders after the veteran but outgoing governor of China’s central bank warned of a “Minsky moment”, a reference to excessive optimism about economic growth fueled by vast debt and speculative investment. U.S. commercial crude oil stocks have dropped 15 percent from their March records, to 456.5 million barrels, below levels seen last year. Part of this drawdown has been due to rising exports as a result of the steep discount of WTI crude to Brent, which makes it attractive for American producers to export their oil. RBC Capital Markets said, “A strong indicator that global inventories are being run down will be when the market starts relying on U.S. exports to fill deficits.” Shipping data in Thomson Reuters Eikon shows that overseas U.S. crude oil shipments have soared from virtually zero before the government loosened export restrictions in late 2015 to around 2.6 million barrels per day (bpd) in October. Exports were further boosted since a production cut led by the Organization of the Petroleum Exporting Countries (OPEC) has been in place since January this year, and which OPEC wants to expend beyond its current expiry date at the end of March 2018.

 

 
Intraday RESISTANCE LEVELS
20th October 2017 R1 R2 R3
GOLD-XAU 1,288 1,300 1,312-1,321
Silver-XAG 17.50-18.00 18.60 19.00
Crude Oil 51.50 52.00-53.00 53.70
EURO/USD 1.1850-1.1875 1.1980 1.1980
GBP/USD 1.3150-1.3190 1.3260 1.3300
USD/JPY 113.60 114.00 114.50

Intraday SUPPORTS LEVELS
20th October 2017 S1 S2 S3
GOLD-XAU 1,279 1,273-1,266 1,260
Silver-XAG 17.10 16.70 16.70 16.35-16.00
Crude Oil 50.10-49.00 50.10-49.00 48.40
EURO/USD 1.1800-1.1770 1.1700 1.1660-1.1610
GBP/USD 1.3100 1.3030-1.2950 1.2900
USD/JPY 113.00-112.30 111.50 110.70

Intra-Day Strategy (20th October 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 Thursday made its intraday high of US$1290.31/oz and low of US$1276.53/oz. Gold was up by 0.694% at US$1289.58/oz.

Technicals in Focus:

In daily charts, prices are below 50DMA (1300) and breakage above will call for 1312-1321. MACD is below zero line and histograms are increasing trend and it will bring upward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. 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 1288-1329 keeping stop loss closing above 1329 and targeting 1279-1273 and 1263-1254. Buy above 1279-1260 with risk below 1260, targeting 1288-1300-1311 and 1320-1329.

 
Intraday Support Levels
S1     1,279
S2     1,273-1,266
S3     1,260
Intraday Resistance Levels
R1     1,288
R2     1,300
R3     1,312-1,321

Technical Indicators

Name   Value Action
14DRSI  

46.88

Buy
20-DMA   1285.54 Buy
50-DMA  

1299.58

Sell
100-DMA   1275.67 Buy
200-DMA   1257.73 Buy
STOCH(5,3)   29.394 Buy
MACD(12,26,9)   -2.271 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$17.27/oz and low of US$16.89/oz. Silver settled up by 1.592% at US$17.22/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 200DMA (17.16), breakage below will lead to 16.70-16.35. 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 negative crossover to show downside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 17.10-15.00 targeting 17.50-17.70 and 18.00-18.60-19.00; stop breakage below 15.00. Sell below 17.50-19.00 with stop loss above 19.00; targeting 17.10-16.80-16.50 and 16.00-15.60.

 
Intraday  Support Levels
S1     17.10
S2     16.70
S3     16.70 16.35-16.00

Intraday  Resistance Levels
R1     17.50-18.00
R2     18.60
R3     19.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.816 Buy
20-DMA   16.93 Buy
50-DMA   17.19 Buy
100-DMA   16.87 Buy
200-DMA   17.17 Buy
STOCH(5,3)   42.549 Buy
MACD(12,26,9)   0.006 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$52.15/bbl, intraday low of US$51.05/bbl and settled down by 1.268% to close at US$51.37/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 51.50-54.00 with stop loss at 54.00; targeting and 50.90-50.10-49.00 and 48.40-48.00. Buy above 50.90-48.40 with risk daily closing below 48.00 and targeting 51.50-51.00-52.50 and 53.00-53.70.

 
Intraday Support Levels
S1     50.10-49.00
S2     50.10-49.00
S3     48.40

Intraday Resistance Levels
R1     51.50
R2     52.00-53.00
R3     53.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   55.632 Sell
20-DMA   51.10 Buy
50-DMA   49.45 Buy
100-DMA   47.95 Buy
200-DMA   49.44 Sell
STOCH(5,3)   54.913 Sell
MACD(12,26,9)   0.536 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1767/EUR, high of US$1.1857/EUR and settled the day up by 0.542% to close at US$1.1851/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 1.1850-1.1980 targeting 1.1800-1.1770-1.1700-1.1660 and 1.1610-1.1555 with stop-loss at daily closing above 1.1980. Buy above 1.1790-1.1610 with risk below 1.1610 targeting 1.1830-1.1875 and 1.1930-1.1980.

 
Intraday Support Levels
S1     1.1800-1.1770
S2     1.1700
S3     1.1660-1.1610

Intraday  Resistance Levels
R1     1.1850-1.1875
R2     1.1980
R3     1.1980

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.344 Buy
20-DMA   1.1786 Buy
50-DMA   1.1847 Buy
100-DMA   1.1653 Buy
200-DMA   1.1217 Buy
STOCH(5,3)   63.509 Sell
MACD(12,26,9)   -0.0089 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3131/GBP, high of US$1.3227/GBP and settled the day by down by 0.340% to close at US$1.3158/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 neutral 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 1.3150-1.3300 with targets at 1.3100-1.3020 and 1.2950-1.2900. Buy above 1.3100-1.3015 with stop loss closing below 1.3000 targeting 1.3260-1.3300-1.3360 and 1.3400-1.3450.

 
Intraday Support Levels
S1     1.3100
S2     1.3030-1.2950
S3     1.2900

Intraday Resistance Levels
R1     1.3150-1.3190
R2     1.3260
R3     1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

41.904

Buy
20-DMA   1.3255 Buy
50-DMA   1.3157 Buy
100-DMA   1.3043 Buy
200-DMA   1.2812 Buy
STOCH(5,3)   18.068 Sell
MACD(12,26,9)   0.0006 Buy

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY112.28/USD and made an intraday high of JPY113.14/USD and settled the day up by 0.659% at JPY112.53/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 112.30-111.50-111.0 and 110.70-110.35. Long positions above 112.30-110.70 with targets of 113.00-113.60 and 114.00-114.50 with stop below 110.70.

 
Intraday Support Levels
S1     113.00-112.30
S2     111.50
S3     110.70

INTRADAY RESISTANCE LEVELS
R1     113.60
R2     114.00
R3     114.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.235 Buy
20-DMA   112.49 Buy
50-DMA   110.93 Buy
100-DMA   111.19 Buy
200-DMA   111.73 Sell
STOCH(9,6)   81.89 Buy
MACD(12,26,9)   0.418 Sell

AAFX TRADING
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