AAFX TRADING

Daily Market Lookup

  • Asian shares stepped back from decade highs on Tuesday as Chinese stocks stumbled for a second straight session, while the U.S. dollar trod water ahead of a crucial Senate vote on tax reform Investor confidence in China has been dented by rising bond yields as Beijing steps up its crackdown on shadow banking and other risky forms of financing. Higher borrowing costs threaten to squeeze corporate profits. The dollar got a brief boost overnight when President Donald Trump tweeted that the tax cut bill was "coming along very well". The tweet came after a meeting with Senate Republican tax-writers on Monday ahead of a crucial vote on the Senate floor that could come as early as Thursday. Separately, the U.S. Senate Banking Committee holds a hearing on Tuesday to confirm the nomination of Jerome Powell at the helm of the Federal Reserve. If confirmed, Powell will have to balance tightening policy against still sluggish wages and inflation. The dollar eased in Asia on Wednesday as a slate of Fed speakers joined by the US treasury secretary is ahead and markets keep an eye on the Korean Peninsula for risk trade. A Japanese diplomat warned on Monday that radio signals detected from the North Korea indicated another North Korean missile test was close, fuelling demand for safe-haven gold. “There is a possibility of missiles launches in the next few days,” a Japanese government official said on Monday, according to Japan's Kyodo news agency. The potential of fresh missile launches from the Kim Jong-un led nation is believed to be part of the North Korea army’s winter training regime. Later on Tuesday is the Jerome Powell Fed Chair confirmation hearing starting at 10am ET before the Senate Banking Committee. As well, New York Fed President William Dudley will speak at 9:15 ET at the New York Fed. Philadelphia Fed President Patrick Harker will speak at 10:15am ET at the Philadelphia Fed. Treasury Secretary Steven Mnuchin is slated to make remarks at 3:45pm at the New York Fed. Attention has also shifted back to President Trump’s tax reform plans. Trump will hold a meeting with Senate Republicans on Tuesday to discuss efforts to pass the proposed legislation.
  • As a nominee to lead the Fed, veteran governor Jerome Powell sides with the outgoing chair Janet Yellen in arguing that the Fed’s easy money policy has paid off by bringing millions back to work without any clear sign it has thrown markets off kilter. Jerome Powell, U.S. President Donald Trump's nominee to become chairman of the U.S. Federal Reserve at the announcement event in the Rose Garden of the White House in Washington, U.S. on Nov 2, 2017. In remarks released ahead of his hearing by the Senate Banking Committee which is due on Tuesday, Powell said the Fed needed the capacity “to respond decisively and with appropriate force” to new threats to the economy. In the past, however, Powell has been more cautious about the risks posed by such an expansive approach. In his first months at the Fed, Powell was among those who pressured then chair Ben Bernanke for more clarity on when the central bank would start scaling back its bond buying. When Bernanke made those plans public it triggered a “taper tantrum” spike in market interest rates in the summer of 2013, forcing Bernanke, Powell and others to do damage control. As Powell former colleagues, associates and former Fed staff say the key unanswered question is whether his evolution - from a former investment banker wary of an expanding Fed to a supporter of Yellen’s jobs-first approach - represents a change of heart, or rather the outgoing chair’s imprint on the current debate. Powell will inherit a strong economy, low inflation and a clear near-term policy path set by Yellen. What is not clear is how he would respond to another recessionary shock, Minneapolis Fed President Narayana Kocherlakota, who himself transitioned from a policy hawk to dove while in office, told Reuters. Powell will come under particular scrutiny as the first non-economist to run the Fed since William Miller in the 1970s, who was at odds with markets and his colleagues over his reluctance to raise rates to fight high inflation.
  • Oil prices slipped in Asian trade on Tuesday amid uncertainty over a possible extension of output cuts by major crude producers and expectations of higher supply as the Keystone pipeline restarts. U.S. crude touched $59.05 a barrel on Friday, the highest level since mid-2015, fueled by the outage of the Keystone pipeline, one of Canada's main crude export routes to the United States. But TransCanada Corp this week said it would restart the 590K bpd pipeline at reduced pressure later on Tuesday after getting approval from U.S. regulators. Uncertainty over Russia's determination to join with other major oil producers in extending crude production curbs beyond next March has weighed on oil markets. Members of the OPEC and other key producers, including Russia, will meet on Nov. 30 to discuss whether to continue with the cuts after they agreed last January to withhold 1.8mn bpd of output. Russia's economy was negatively affected in October by the ongoing curbs, which saw Moscow agree to cut output by 300K bpd, Economy Minister Maxim Oreshkin said on Nov. 23. Goldman Sachs said the outcome of the meeting was "much more uncertain than usual", adding that the market faced downside risks. Consultancy Wood Mackenzie said it looked as if producers had nearly concluded an agreement to extend cuts until the end of next year. Some traders are also starting to consider the possibility that while producers will agree to extend the curbs, the scale of the output cuts will be reduced from the current 1.8 mn bpd.

 

 
Intraday RESISTANCE LEVELS
28th November 2017 R1 R2 R3
GOLD-XAU 1,300 1,311-1320 1,326
Silver-XAG 17.20 17.50-18.00 18.60
Crude Oil 58.50 59.00-59.60 60.50
EURO/USD 1.1930-1.1990 1.2050 1.2090
GBP/USD 1.3360 1.3425-1.3500 1.3570
USD/JPY 111.50-112.00 113.00 114.00

Intraday SUPPORTS LEVELS
28th November 2017 S1 S2 S3
GOLD-XAU 1,290 1,284 1,274-1,265
Silver-XAG 16.70 16.35-16.00 15.60
Crude Oil 57.70 57.00 56.00-55.40
EURO/USD 1.1850 1.1800-1.1750 1.1700
GBP/USD 1.3300 1.3150 1.3150
USD/JPY 111.00-110.60 110.00 109.10

Intra-Day Strategy (28th 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$1299.14/oz and low of US$1286.62/oz. Gold was up by 0.463% at US$1294.26/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 1300-1331 keeping stop loss closing above 1320 and targeting 1290-1280-1274 and 1266-1260. Buy above 1284-1250 with risk below 1250, targeting 1300-1311 and 1321-1330.

 
Intraday Support Levels
S1     1,290
S2     1,284
S3     1,274-1,265
Intraday Resistance Levels
R1     1,300
R2     1,311-1320
R3     1,326

Technical Indicators

Name   Value Action
14DRSI  

56.667

Buy
20-DMA   1282.21 Sell
50-DMA  

1283.25

Sell
100-DMA   1284.19 Sell
200-DMA   1266.23 Buy
STOCH(5,3)   74.865 Buy
MACD(12,26,9)   2.500 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$16.99/oz and low of US$16.99/oz. Silver settled down by 0.058% 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   50.034 Buy
20-DMA   17.01 Buy
50-DMA   16.97 Buy
100-DMA   16.95 Buy
200-DMA   17.11 Buy
STOCH(5,3)   45.294 Buy
MACD(12,26,9)   -0.013 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$58.97/bbl, intraday low of US$57.52/bbl and settled down by 1.917% to close at US$57.81/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 58.50-60.50 with stop loss at 60.50; targeting and 57.70-57.00-56.00 and 56.50-55.40. Buy above 57.50-54.80 with risk daily closing below 54.80 and targeting 58.50- 59.60 and 60.50-61.20.

 
Intraday Support Levels
S1     57.70
S2     57.00
S3     56.00-55.40

Intraday Resistance Levels
R1     58.50
R2     59.00-59.60
R3     60.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.658 Sell
20-DMA   56.69 Buy
50-DMA   53.63 Buy
100-DMA   50.85 Buy
200-DMA   49.81 Buy
STOCH(5,3)   68.335 Buy
MACD(12,26,9)   1.316 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1896/EUR, high of US$1.1960/EUR and settled the day up by 0.259% to close at US$1.1897/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 overbought 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 1.1930-1.12090 targeting 1.1850-1.1800-1.1750 and 1.1700-1.1660-1.1590 with stop-loss at daily closing above 1.2040. Buy above 1.1850-1.1700 with risk below 1.1700 targeting 1.1930-1.1990 and 1.2050-1.2090.

 
Intraday Support Levels
S1     1.1850
S2     1.1800-1.1750
S3     1.1700

Intraday  Resistance Levels
R1     1.1930-1.1990
R2     1.2050
R3     1.2090

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.343 Buy
20-DMA   1.1733 Buy
50-DMA   1.1760 Sell
100-DMA   1.1774 Sell
200-DMA   1.1358 Buy
STOCH(5,3)   81.825 Buy
MACD(12,26,9)   -0.0042 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3309/GBP, high of US$1.3382/GBP and settled the day up by 0.045% to close at US$1.3316/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 1.3360-1.3570 with targets at 1.3300-1.3260-1.3200 and 1.3100-1.3050. Buy above 1.3300--1.2950 with stop loss closing below 1.2950 targeting 1.3260-1.3300 and 1.3360-1.3440.

 
Intraday Support Levels
S1     1.3300
S2     1.3150
S3     1.3150

Intraday Resistance Levels
R1     1.3360
R2     1.3425-1.3500
R3     1.3570

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

60.284

Buy
20-DMA   1.3205 Sell
50-DMA   1.3244 Sell
100-DMA   1.3146 Buy
200-DMA   1.2915 Buy
STOCH(5,3)   73.768 Sell
MACD(12,26,9)   -0.0034 Buy

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.83/USD and made an intraday high of JPY111.68/USD and settled the day down by 0.376% at JPY111.08/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 111.50-114.00 with risk above 114.00 targeting 111.00-110.60 and 110.00-109.10. Long positions above 111.0-109.10 with targets of 111.50-112.00 and 113.00-113.60-114.00 with stop below 116.00.

 
Intraday Support Levels
S1     111.00-110.60
S2     110.00
S3     109.10

INTRADAY RESISTANCE LEVELS
R1     111.50-112.00
R2     113.00
R3     114.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.831 Buy
20-DMA   112.99 Buy
50-DMA   112.80 Buy
100-DMA   111.61 Buy
200-DMA   111.69 Buy
STOCH(9,6)   17.064 Sell
MACD(12,26,9)   0.287 Sell

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