AAFX TRADING

Daily Market Lookup

  • Asian shares joined a global rally to reach their highest in a decade on Wednesday as strong world growth and rising corporate profits lured hordes of investors into equities, while oil prices jumped closer to a recent 2-1/2 year top. The index has been on an uptrend most of this year, posting a monthly loss only once in 2017. For the year so far, it is up about 33 percent, on track for its best annual performance since a 68 percent jump in 2009. A strengthening global economy has fed an insatiable appetite for equities this year, with Asia’s trade-dependent nations enjoying robust overseas sales in a boon to corporate earnings. But some money managers are starting to feel the jitters as the bullish consensus grows, among them French investment house Societe Generale. Some equity investors are worried a U.S. rate hike next month and further tightening in 2018 could dampen the mood.
  • The dollar treaded water against its peers on Wednesday, capped as U.S. Treasury yields failed to rise despite increasing investor risk appetite in broader financial markets. The ongoing flattening of the Treasury yield curve, which has capped long-term yields, is a further drag on the dollar, Daiwa’s Ishizuki said. The U.S. yield curve flattened to its lowest in a decade on Tuesday, as investors price in the expectation that the Federal Reserve will continue to raise rates while the Treasury is seen increasing short-dated debt issuance. At the same time low inflation and global demand for yield has supported longer-dated debt. Another factor seen supporting the Japanese yen on a broader level was its recent gains against the euro. The common currency slumped against its peers at the start of the week as German Chancellor Angela Merkel’s failure to form a three-way “Jamaica coalition” government clouded the country’s political outlook. The currency market showed little response to comments by Fed Chair Janet Yellen, who said late on Tuesday the central bank is “reasonably close” to its goals and should keep gradually raising U.S. interest rates to avoid the dual pitfalls of letting inflation drift below target for too long and driving unemployment down too far. Next in focus was the minutes of the Oct. 31-Nov. 1 Fed policy meeting minutes due later in the session, to be evaluated for any new indications that an interest rate hike is likely in December.
  • Gold prices eased in Asia on Wednesday as investors geared for Fed meetings later in the day for more insight on the rate path in 2018. With Fed minutes from the November meeting due, analysts do not expect anything in the comments to dissuade market participants from assigning a high likelihood of a December rate hike. Former Fed chair Bernanke has also recently weighed in on this topic, arguing in favor of temporary price level targeting if the fed funds rate hits the effective lower bound in the future. Overnight, gold prices rose on Tuesday after the dollar fell amid weakness in long-term yields ahead of the release of the Federal Reserve's October meeting meetings slated for Wednesday. Long-term treasury yields remained under pressure, weighing on the dollar, while boosting demand for gold as traders awaited the minutes of the Federal Reserve October meeting for clues on future monetary policy action. Gold is sensitive to moves lower in the U.S. dollar – A weaker dollar makes gold cheaper for holders of foreign currency, which increases demand for the precious metal. Also adding to positive sentiment on the precious metal was the return of safe haven demand amid renewed U.S-North Korea tensions after President Donald Trump placed North Korea back on a list of state sponsors of terrorism on Monday.
  • Oil prices rose on Wednesday as ongoing cuts of piped Canadian crude to the United States added to falling U.S. crude inventories, while expectations of a prolonged OPEC-led production cut also offered support. Traders said the firm price lift was due to drop in crude supplies from Canada to the United States. TransCanada Corp said it will cut deliveries by at least 85 percent on its 590,000 bpd Keystone crude pipeline through to the end of November. The pipeline, which links Alberta's oil sands to U.S. refineries, was shut last week after a 5,000-barrel spill in South Dakota. Traders said there was also some price support from a weekly report on Tuesday by the API which said U.S. crude inventories fell by 6.4 million barrels in the week to Nov. 17. The latest official U.S. production and inventory data is due on Wednesday Outside North America, markets have been supported by an effort led by the OPEC to restrain output in a bid to end a global supply overhang. The deal to curb production is due to expire in March, but OPEC will meet on Nov. 30 in Vienna to discuss the outlook for the policy. J.P. Morgan said in its 2018 commodities outlook, released late on Tuesday, that "oil markets in 2018 will be balanced on the back of extended ... production cuts", but added that without extended cuts, markets would be in surplus.

 

 
Intraday RESISTANCE LEVELS
22nd November 2017 R1 R2 R3
GOLD-XAU 1,284-1,290 1,300 1,311-1320
Silver-XAG 17.20 17.50-18.00 18.60
Crude Oil 57.75-58.50 59.60 60.50
EURO/USD 1.1800 1.1850 1.1910-1.1990
GBP/USD 1.3260-1.3300 1.3360 1.3425
USD/JPY 113.00-113.60 114.00 114.50

Intraday SUPPORTS LEVELS
22nd November 2017 S1 S2 S3
GOLD-XAU 1,274-1,265 1,260 1,252
Silver-XAG 16.70 16.35-16.00 15.60
Crude Oil 57.00 56.00 55.40-54.80
EURO/USD 1.1750 1.1700 1.1660-1.1590
GBP/USD 1.3240-1.3200 1.3150 1.3050
USD/JPY 112.00-111.50 110.60 110.00

Intra-Day Strategy (22nd 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 Tuesday made its intraday high of US$1284.66/oz and low of US$1276.22/oz. Gold was up by 0.279% at US$1280.26/oz.

Technicals in Focus:

In daily charts, prices are below 100DMA (1278) 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 1284-1320 keeping stop loss closing above 1320 and targeting 1280-1274 and 1266-1260-1252. Buy above 1280-1250 with risk below 1250, targeting 1300-1311 and 1321-1330.

 
Intraday Support Levels
S1     1,274-1,265
S2     1,260
S3     1,252
Intraday Resistance Levels
R1     1,284-1,290
R2     1,300
R3     1,311-1320

Technical Indicators

Name   Value Action
14DRSI  

49.657

Buy
20-DMA   1277.47 Sell
50-DMA  

1285.87

Sell
100-DMA   1280.55 Sell
200-DMA   1264.79 Buy
STOCH(5,3)   48.592 Sell
MACD(12,26,9)   -0.788 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$17.04/oz and low of US$16.89/oz. Silver settled down by 0.296% at US$16.94/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   49.884 Buy
20-DMA   16.97 Buy
50-DMA   16.99 Buy
100-DMA   16.91 Buy
200-DMA   17.12 Buy
STOCH(5,3)   21.766 Buy
MACD(12,26,9)   -0.0017 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$57.20/bbl, intraday low of US$56.30/bbl and settled down by 1.349% to close at US$57.07/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 57.75-60.50 with stop loss at 60.50; targeting and 57.00-56.00 and 56.50-56.00-55.40. Buy above 57.00-54.80 with risk daily closing below 54.80 and targeting 57.75- 58.50 and 59.60-60.50.

 
Intraday Support Levels
S1     57.00
S2     56.00
S3     55.40-54.80

Intraday Resistance Levels
R1     57.75-58.50
R2     59.60
R3     60.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   68.048 Sell
20-DMA   55.80 Buy
50-DMA   52.97 Buy
100-DMA   50.32 Buy
200-DMA   49.71 Buy
STOCH(5,3)   87.426 Sell
MACD(12,26,9)   1.222 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1712/EUR, high of US$1.1757/EUR and settled the day up by 0.051% to close at US$1.1737/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 1.1800-1.1990 targeting 1.1750-1.1700-1.1660 and 1.590-1.1555 with stop-loss at daily closing above 1.2040. Buy above 1.1750-1.1550 with risk below 1.1550 targeting 1.1750-1.1800-1.1850 and 1.1910-1.1990.

 
Intraday Support Levels
S1     1.1750
S2     1.1700
S3     1.1660-1.1590

Intraday  Resistance Levels
R1     1.1800
R2     1.1850
R3     1.1910-1.1990

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.490 Buy
20-DMA   1.1678 Buy
50-DMA   1.1763 Sell
100-DMA   1.1754 Sell
200-DMA   1.1332 Buy Buy
STOCH(5,3)   30.828 Sell
MACD(12,26,9)   -0.0034 Buy Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3208/GBP, high of US$1.3266/GBP and settled the day up by 0.030% to close at US$1.3237/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 1.3260-1.3425 with targets at 1.3200-1.3100-1.3050 and 1.3000-1.2950. Buy above 1.3200--1.2950 with stop loss closing below 1.2950 targeting 1.3260-1.3300 and 1.3360-1.3440.

 
Intraday Support Levels
S1     1.3240-1.3200
S2     1.3150
S3     1.3050

Intraday Resistance Levels
R1     1.3260-1.3300
R2     1.3360
R3     1.3425

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

55.228

Buy
20-DMA   1.3177 Sell
50-DMA   1.3256 Sell
100-DMA   1.3125 Buy
200-DMA   1.2893 Buy
STOCH(5,3)   78.585 Buy
MACD(12,26,9)   -0.0022 Buy

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY112.17/USD and made an intraday high of JPY112.69/USD and settled the day down by 0.159% at JPY112.43/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 113.00-115.00 with risk above 115.00 targeting 112.30-111.50 and 110.60-110.00. Long positions above 112.30-110.00 with targets of 113.00-113.60 and 114.00-114.60-115.00 with stop below 116.00.

 
Intraday Support Levels
S1     112.00-111.50
S2     110.60
S3     110.00

INTRADAY RESISTANCE LEVELS
R1     113.00-113.60
R2     114.00
R3     114.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   26.308 Buy
20-DMA   113.45 Buy
50-DMA   112.75 Buy
100-DMA   111.70111.70 Buy
200-DMA   111.73 Buy
STOCH(9,6)   26.326 Sell
MACD(12,26,9)   0.035 Sell

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