AAFX TRADING

Daily Market Lookup

  • Asian stocks faltered on Tuesday as Chinese economic data disappointed and investors pondered whether a marked flattening in the U.S. yield curve might ultimately be a harbinger of a slowdown there. China’s retail sales rose 10 percent on the year in October, while industrial output grew 6.2%. Both came in under market forecasts and nudged down the Australian dollar, which is often used as a liquid proxy for China wagers. Investors were waiting for any signs of compromise on U.S. tax policy after U.S. Senate Republicans on Thursday unveiled a plan that would cut corporate taxes a year later than a rival House of Representatives’ bill. Also on the menu are no fewer than 13 central bank speakers, including the heads of the U.S., European, British and Japanese central banks. May’s blueprint for Britain’s departure from the EU faces a crucial test starting on Tuesday, when lawmakers try to win concessions on legislation to sever ties. Figures out on Monday from the Commodity Futures Trading Commission showed the speculative net short position in the Japanese yen had blown out to the largest since January 2014 and in the Swiss franc to the biggest since December 2016. The trend in part reflects market wagers the U.S. FED plans to hike rates in December and two or three times next year will prove all too successful in restraining inflation by ultimately slowing the economy. The dollar got support from higher U.S. Treasury yields in early Asian trading on Tuesday, while sterling arrested a recent slide, which followed concerns about Theresa May's ability to stay on as British prime minister. The yield on two-year U.S. Treasury notes scaled a nine-year peak on Monday, as the yield curve resumed its flattening and investors priced in a 25-basis-point interest rate hike by the Federal Reserve next month. Sterling edged up 0.1% to $1.3122 after coming under pressure from political turmoil ahead of this week's debate by British lawmakers about the government's plan to leave the European Union. The debate on the Brexit bill kicks off on Tuesday and Wednesday, and takes place against an unstable political backdrop. Also in focus this week, ECB chief Mario Draghi, Federal Reserve Chair Janet Yellen, BoJ Governor Haruhiko Kuroda and BoE head Mark Carney will form a panel on central bank communication at the ECB-hosted
  • conference in Frankfurt later on Tuesday.
  • Gold edged weaker in Asia on Tuesday with sentiment mixed after weaker that expected retail sales and industrial output in China. In China, fixed-asset investment gained 7.3%, a tad weaker than the 7.4% increase seen in October on year, along with industrial production, which gained 6.2%, missing the 6.3% rise seen and retail sales up 10%, compared with a 10.4% gain expected The House of Representatives is expected to vote this week on a major tax reform bill amid uncertainty over the outcome of the bill after the head of the House of Represents’ tax-writing committee said on Sunday he would not accept elimination of a federal deduction for state and local taxes. With a 52-seat Senate majority, Republicans can only afford to lose two GOP senators – as Democrats are widely expected to vote no but Vice President Pence would have to break a tie. Uncertainty over the progress of the Republican tax plan has weighed on the dollar, helping gold prices snap its three-week losing streak on Friday but traders expect the precious metal to make its next significant move higher or lower when the Fed members meet in December. Oil prices fell on Tuesday as the prospect of further rises in U.S. output undermined ongoing OPEC-led production cuts aimed at tightening the market. The falls came after both crude benchmarks early last week hit highs last seen in 2015, but traders said the market had lost some momentum since then. Traders said they were cautious on betting on further price rises. This sentiment comes in part on the back of rising U.S. oil output, which has grown by more than 14% since mid-2016 to a record 9.62 mn bpd. The U.S. government said on Monday U.S. shale production for December would rise for a 12th consecutive month, increasing by 80K bpd. Fitch Ratings said in its 2018 oil outlook that it assumed 2018 "average oil prices will be broadly unchanged year-on-year and that the recent price recovery with Brent exceeding $60 per barrel may not be sustained". So far in 2017, Brent has averaged at $54.5/bbl .Despite the cautious sentiment, traders said oil prices would unlikely fall very far, largely due to ongoing supply restrictions led by the OPEC and Russia, which have contributed to a reduction in excess supplies. OPEC also raised its oil demand forecast, saying the world would need 33.42 mn bpd of OPEC crude next year, up 360K bpd from its previous forecast and marking the fourth consecutive monthly increase in the outlook since July. In China, refiners raised crude oil processing runs to near record monthly levels in October, with operations increasing by 7.4% to 50.51 mn tonnes, or 11.89 mn bpd, China's statistics bureau said on Tuesday. OPEC is due to meet on Nov. 30 to discuss further output policy. The group is expected to agree an extension of the cuts beyond their current expiry date in March 2018. Looking further out, the IEA said on Tuesday there will be 50 mn electric vehicles (EVs) on the road by 2025 and 300 mn by 2040, from around 2 mn now. This is expected to cut 2.5 mn bpd, or about 2 percent, off global oil demand by that time. Still, the IEA's "New Policies Scenario", based on existing legislation and policy intentions, expects oil prices to rise towards $83 a barrel by the mid-2020s.

 

 
Intraday RESISTANCE LEVELS
14th November 2017 R1 R2 R3
GOLD-XAU 1,281 1,290-1,300 1,311
Silver-XAG 17.20 17.50-18.00 18.60
Crude Oil 57.00 57.75 58.85-59.50
EURO/USD 1.1700 1.1750 1.1800-1.1850
GBP/USD 1.3150 1.3260-1.3300 1.3360
USD/JPY 113.00-112.30 114.50 115.00-115.50

Intraday SUPPORTS LEVELS
14th November 2017 S1 S2 S3
GOLD-XAU 1,274 1,266 1,260-1,252
Silver-XAG 16.70 16.35-16.00 15.60
Crude Oil 56.50 56.50 56.50
EURO/USD 1.1660-1.1610 1.1550 1.1490-1.1400
GBP/USD 1.3100 1.3050 1.3260-1.3300
USD/JPY 113.00-112.30 111.50 110.60

Intra-Day Strategy (14th 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$1279.65/oz and low of US$1274.22/oz. Gold was up by 0.263% at US$1278.12/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 neutral territory and giving positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1281-1311 keeping stop loss closing above 1311 and targeting 1274-1266 and 1260-1251. Buy above 1274-1235 with risk below 1235, targeting 1281-1288-1300 and 1311-1320.

 
Intraday Support Levels
S1     1,274
S2     1,266
S3     1,260-1,252
Intraday Resistance Levels
R1     1,281
R2     1,290-1,300
R3     1,311

Technical Indicators

Name   Value Action
14DRSI  

47.460

Buy
20-DMA   1277.72 Sell
50-DMA  

1292.66

Sell
100-DMA   1277.92 Sell
200-DMA   1263.33 Buy
STOCH(5,3)   55.110 Sell
MACD(12,26,9)   -2.770 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$17.05/oz and low of US$16.81/oz. Silver settled up by 1.128% at US$17.03/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 17.20-17.50-17.70 and 18.00-18.60; stop breakage below 15.00. Sell below 17.20-19.00 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   50.001 Buy
20-DMA   16.96 Buy
50-DMA   17.09 Buy
100-DMA   16.87 Buy
200-DMA   17.15 Buy
STOCH(5,3)   40.521 Sell
MACD(12,26,9)   -0.0124 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$57.14/bbl, intraday low of US$56.29/bbl and settled down by 0.281% to close at US$56.71/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 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 57.00-60.50 with stop loss at 60.50; targeting and 56.60-56.00 and 54.60-53.75 Buy above 56.50-54.60 with risk daily closing below 54.60 and targeting 57.00-57.75-58.85 and 59.50-60.50.

 
Intraday Support Levels
S1     56.50
S2     56.50
S3     56.50

Intraday Resistance Levels
R1     57.00
R2     57.75
R3     58.85-59.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   70.498 Sell
20-DMA   54.54 Buy
50-DMA   52.05 Buy
100-DMA   49.70 Buy
200-DMA   49.62 Buy
STOCH(5,3)   36.065 Sell
MACD(12,26,9)   1.551 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1636/EUR, high of US$1.1674/EUR and settled the day up by 0.077% to close at US$1.1666/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 oversold territory and giving negative crossovers to signal for bearish 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 1.1660-1.1850 targeting 1.1590-1.1555 and 1.1490-1.1400 with stop-loss at daily closing above 1.1850. Buy above 1.1610-1.1400 with risk below 1.1400 targeting 1.1660-1.1700-1.1750 and 1.1800-1.1850.

 
Intraday Support Levels
S1     1.1660-1.1610
S2     1.1550
S3     1.1490-1.1400

Intraday  Resistance Levels
R1     1.1700
R2     1.1750
R3     1.1800-1.1850

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.285 Buy
20-DMA   1.1680 Buy
50-DMA   1.1784 Buy
100-DMA   1.1730 Buy
200-DMA   1.1297 Buy
STOCH(5,3)   92.321 Buy
MACD(12,26,9)   -0.0038 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3061/GBP, high of US$1.3179/GBP and settled the day down by 0.364% to close at US$1.3114/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 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 1.3150-1.3360 with targets at 1.3100-1.3050 and 1.3000-1.2950. Buy above 1.3100-1.2950 with stop loss closing below 1.2950 targeting 1.3260-1.3300 and 1.3360-1.3440.

 
Intraday Support Levels
S1     1.3100
S2     1.3050
S3     1.3260-1.3300

Intraday Resistance Levels
R1     1.3150
R2     1.3260-1.3300
R3     1.3360

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

45.849

Buy
20-DMA   1.3165 Sell
50-DMA   1.3249 Sell
100-DMA   1.3112 Buy
200-DMA   1.2875 Buy
STOCH(5,3)   47.695 Sell
MACD(12,26,9)   -0.0024 Buy

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY113.24/USD and made an intraday high of JPY113.70/USD and settled the day up by 0.079% at JPY113.61/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 in neutral region and direction is difficult to predict on RSI bases MACD is above zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is approaching oversold territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 113.60-116.20 with risk above 116.20 targeting 113.00-112.30 and 111.50-110.60. Long positions above 113.00-110.60 with targets of 113.60-114.00-114.60 and 115.00-115.60 with stop below 116.00.

 
Intraday Support Levels
S1     113.00-112.30
S2     111.50
S3     110.60

INTRADAY RESISTANCE LEVELS
R1     113.00-112.30
R2     114.50
R3     115.00-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.762 Buy
20-DMA   113.54 Buy
50-DMA   112.29 Buy
100-DMA   111.69 Buy
200-DMA   111.74 Buy
STOCH(9,6)   26.166 Sell
MACD(12,26,9)   0.399 Sell

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