AAFX TRADING

Daily Market Lookup

  • Asian shares stepped back from recent decade highs on Monday while major currencies held in tight ranges and oil jumped to a more than two-year peak as Saudi Arabia’s crown prince cemented his power through an anti-corruption crackdown. Oil prices hit their highest since July 2015 as Mohammed bin Salman’s purge led to arrests of royals, ministers and investors including prominent business billionaire Alwaleed bin Talal. The news stirred concerns of Middle East money pulling out of some Asian markets. In addition, a weekend call by China’s central bank governor for tougher financial regulation hit investor sentiment. Near-term sentiment in the market will be dictated by news related to U.S. President Donald Trump’s Asian tour this week. In his second day in Japan, Trump ramped up his tough rhetoric against North Korea, saying the United States and its allies are prepared to defend freedom. The U.S. president wants a united front with the leaders of Japan and South Korea before he visits Beijing to make the case to Chinese President Xi Jinping that more needs to be done to rein in Pyongyang. Trump also plans to meet Russian counterpart Vladimir Putin during his 12-day trip. Meanwhile, forex investors awaited progress on U.S. tax reforms which, if passed in its current form, will add $1.5 trillion to the U.S. budget deficit over the next 10 years, said Elias Haddad, currency strategist at Commonwealth Bank. For now, sentiment towards the greenback was still positive with leveraged funds paring bearish bets to be net long for the first time since late July. The dollar climbed against the yen to an eight-month peak after a string of U.S. data bolstered views the Federal Reserve will hike interest rates next month and tighten further in 2018. U.S. non-manufacturing purchasing managers’ index rose to its highest since 2005, figures out on Friday showed. New orders for U.S.-made goods gained for the second straight month in September and orders for core capital goods surpassed expectations. Bin Salman’s reforms include a plan to list parts of giant state-owned oil company Saudi Aramco next year, and a higher oil price is seen as beneficial for the market capitalization of the future listed company.
  • The dollar touched its highest level in nearly eight months versus the yen on Monday, supported by expectations for continued monetary policy divergence between the Federal Reserve and the Bank of Japan. The contrasting outlooks for monetary policy in the United States and Japan contributed to the dollar's firm tone against the yen, analysts said, with the Fed expected to stay on a path of gradual policy tightening while the BOJ is seen as in no hurry to exit its ultra-easy monetary policy. BOJ Governor Haruhiko Kuroda said on Monday that it will proceed with powerful monetary easing under its yield curve control policy, although he also added that the central bank was closely watching the economic effects of a prolonged ultra-easy monetary policy. The dollar was resilient in the wake of underwhelming U.S. October jobs data released on Friday, which showed a slowdown in wage growth and a smaller-than-expected increase in nonfarm payrolls. Although U.S. wage growth disappointed, analysts remain optimistic that wages will pick up, and there was little change in market expectations for the Fed to raise interest rates in December for a third time this year. In the near-term, analysts said market participants will be watching to see whether there is more progress in U.S. tax reforms, while focus will also be on U.S. President Donald Trump's visit to Asia. Trump, charging Japan "has been winning" on bilateral trade in recent decades, said he would push for more reciprocal trade with Washington's close U.S. ally - but in a "friendly" way. Trump was speaking in Tokyo on the second day of a 12-day Asian trip expected to be dominated by North Korea and trade.
  • Oil prices hit their highest levels since July 2015 early on Monday as markets tightened, while Saudi Arabia’s crown prince cemented his power over the weekend through an anti-corruption crackdown that included high profile arrests. Crown Prince Mohammed bin Salman, also known as MBS, has tightened his grip on power through an anti-corruption purge by arresting royals, ministers and investors including prominent business billionaire Alwaleed bin Talal and the head of the National Guard, Prince Miteb bin Abdullah. RBC Capital Markets said in a note that although the “purge represents a stunning political development in Saudi Arabia,” it expected “no immediate changes” in the oil policy of Saudi Arabia, which is the world’s biggest exporter of crude oil. Bin Salman’s reforms include a plan to list parts of giant state-owned oil company Saudi Aramco next year, and a higher oil prices is seen as beneficial for the market capitalization of the future listed company. In oil fundamentals, traders said that there were ongoing signs of tightening market conditions. The decline in U.S. drilling activity comes as the OPEC and a non-OPEC group lead by Russia have pledged to hold back about 1.8 million barrels per day (bpd) in oil production to tighten markets.

 

 
Intraday RESISTANCE LEVELS
6th November 2017 R1 R2 R3
GOLD-XAU 1,279-1,288 1,300 1,311
Silver-XAG 17.20 17.50-18.00 18.60
Crude Oil 56.00-56.50 57.00 57.75
EURO/USD 1.1660-1.1700 1.1750 1.1800-1.1850
GBP/USD 1.3100 1.3150 1.3260-1.3300
USD/JPY 114.50-115.00 115.50 116.20

Intraday SUPPORTS LEVELS
6th November 2017 S1 S2 S3
GOLD-XAU 1,266 1,260-1,252 1,244
Silver-XAG 16.70 16.35-16.00 15.60
Crude Oil 55.20-54.60 53.75 56.00-56.50
EURO/USD 1.1600 1.1550 1.1490-1.1400
GBP/USD 1.3050-1.3000 1.2950 1.2840
USD/JPY 114.00 113.60 113.00-112.30

Intra-Day Strategy (6th November 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 Monday made its intraday high of US$1280.35/oz and low of US$1265.40/oz. Gold was down by 0.523% at US$1269.79/oz.

Technicals in Focus:

In daily charts, prices are below 100DMA (1275) and breakage above will call for 1312-1321. MACD is below zero line and histograms are decreasing trend and it will bring upward stance in the upcoming sessions. RSI is in oversold region and more downside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1279-1311 keeping stop loss closing above 1311 and targeting 1266-1260-1251 and 1244-1235. Buy above 1269-1235 with risk below 1235, targeting 1279-1288 and 1300-1311.

 
Intraday Support Levels
S1     1,266
S2     1,260-1,252
S3     1,244
Intraday Resistance Levels
R1     1,279-1,288
R2     1,300
R3     1,311

Technical Indicators

Name   Value Action
14DRSI  

41.856

Buy
20-DMA   1280.98 Sell
50-DMA  

1296.50

Sell
100-DMA   1276.27 Sell
200-DMA   1261.56 Buy
STOCH(5,3)   35.860 Sell
MACD(12,26,9)   -5.624 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$17.16/oz and low of US$16.76/oz. Silver settled down by 1.578% at US$16.76/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 positive crossover to show upside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 16.70-15.00 targeting 17.10-17.50-17.70 and 18.00-18.60; stop breakage below 15.00. Sell below 17.10-19.00 with stop loss above 19.00; targeting 16.80-16.50 and 16.00-15.60.

 
Intraday  Support Levels
S1     16.70
S2     16.35-16.00
S3     15.60

Intraday  Resistance Levels
R1     17.20
R2     17.50-18.00
R3     18.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.398 Buy
20-DMA   17.01 Buy
50-DMA   17.17 Buy
100-DMA   16.85 Buy
200-DMA   17.16 Buy
STOCH(5,3)   51.525 Sell
MACD(12,26,9)   -0.045 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$55.74/bbl, intraday low of US$54.39/bbl and settled up by 1.865% to close at US$55.71/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 above zero line and histograms are in increasing 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 56.00-57.75 with stop loss at 57.75; targeting and 55.20-54.60-53.75 and 53.00-52.00. Buy above 55.20-52.00 with risk daily closing below 52.00 and targeting 56.00-56.50 and 57.00-57.75.

 
Intraday Support Levels
S1     55.20-54.60
S2     53.75
S3     56.00-56.50

Intraday Resistance Levels
R1     56.00-56.50
R2     57.00
R3     57.75

TECHNICAL INDICATORS
Name   Value Action
14DRSI   73.612 Sell
20-DMA   52.84 Buy
50-DMA   50.85 Buy
100-DMA   48.86 Buy
200-DMA   49.50 Buy
STOCH(5,3)   90.691 Buy
MACD(12,26,9)   1.288 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1598/EUR, high of US$1.1689/EUR and settled the day down by 0.446% to close at US$1.1604/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1700), which become immediate resistance level, break above will target 1.1750-1.1800. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral territory and giving positive crossovers to signal for bullish outlook for intraday. 14D RSI is currently approaching oversold region and giving wards directions to consider buy.

Trading Strategy: Neutral to Sell

Based on the charts and explanations above; sell below 1.1700-1.1850 targeting 1.1660-1.1600-1.1555 and 1.1490-1.1400 with stop-loss at daily closing above 1.1850. Buy above 1.1660-1.1400 with risk below 1.1400 targeting 1.1700-1.1750 and 1.1800-1.1850.

 
Intraday Support Levels
S1     1.1600
S2     1.1550
S3     1.1490-1.1400

Intraday  Resistance Levels
R1     1.1660-1.1700
R2     1.1750
R3     1.1800-1.1850

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.065 Buy
20-DMA   1.1732 Buy
50-DMA   1.1816 Buy
100-DMA   1.1704 Buy
200-DMA   1.1270 Buy
STOCH(5,3)   35.704 Buy
MACD(12,26,9)   -0.0047 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3038/GBP, high of US$1.3132/GBP and settled the day up by 0.153% to close at US$1.3076/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 oversold 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 1.3100-1.3300 with targets at 1.3050-1.3000 and 1.2950-1.2840. Buy above 1.3050-1.2840 with stop loss closing below 1.2840 targeting 1.3100-1.3150-1.3260 and 1.3300-1.3360.

 
Intraday Support Levels
S1     1.3050-1.3000
S2     1.2950
S3     1.2840

Intraday Resistance Levels
R1     1.3100
R2     1.3150
R3     1.3260-1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

42.269

Buy
20-DMA   1.3188 Sell
50-DMA   1.3224 Sell
100-DMA   1.3085 Buy
200-DMA   1.2857 Buy
STOCH(5,3)   10.030 Sell
MACD(12,26,9)   -0.0031 Buy

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY113.61/USD and made an intraday high of JPY114.42/USD and settled the day down by 0.0008% at JPY114.07/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (111.73), 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 Sell

Sell below 114.50-116.20 with risk above 116.20 targeting 114.00-113.60-113.00 and 112.30-111.50. Long positions above 114.00-111.50 with targets of 114.60-115.00 and 115.60-116.00 with stop below 116.00.

 
Intraday Support Levels
S1     114.00
S2     113.60
S3     113.00-112.30

INTRADAY RESISTANCE LEVELS
R1     114.50-115.00
R2     115.50
R3     116.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.993 Buy
20-DMA   113.21 Buy
50-DMA   111.94 Buy
100-DMA   111.59 Buy
200-DMA   111.72 Buy
STOCH(9,6)   75.989 Buy
MACD(12,26,9)   0.591 Sell

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