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  • The Federal Reserve raised interest rates on Wednesday but left its rate outlook for the coming years unchanged even as policymakers projected a short-term jump in U.S. economic growth from the Trump administration’s proposed tax cuts. In an early verdict on the tax overhaul, Fed policymakers judged it would boost the economy next year but leave no lasting impact, with the long-run potential growth rate stalled at 1.8%. The White House has frequently said its tax plan would produce annual GDP growth of 3 percent to 4 percent. The expected fiscal stimulus, coming on the heels of a flurry of relatively bullish data, cleared the way for the U.S. central bank to raise rates by a quarter of a percentage point to a range of 1.25% to 1.50%. It was the third rate hike this year. But the Fed’s forecast of three additional rate increases in 2018 and 2019 was unchanged from its projections in September, a sign the tax legislation moving through Congress would have a modest, and possibly fleeting, effect. The rate increase represented a victory for a central bank that has struggled at times to deliver on its promised pace of monetary tightening. It also allowed Fed Chair Janet Yellen, at her final press conference before her term ends in February, to signal an all-clear for the U.S. economy a decade after the onset of the 2007-2009 recession. U.S. outgoing Federal Reserve Chair Janet Yellen holds a news conference after a two-day FOMC meeting in Washington, U.S. December 13, 2017. U.S. stocks extended gains after the release of the policy statement before ending mixed, while Treasury yields dropped. The dollar fell against a basket of currencies. The Fed now sees gross domestic product growing 2.5 percent in 2018, up from the 2.1 percent forecast in September. The pace of growth is expected to cool to 2.1 percent in 2019, slightly higher than the prior forecast of 2.0 percent. Chicago Fed President Charles Evans and Minneapolis Fed President Neel Kashkari dissented in the policy statement on Wednesday.
  • The Australian dollar held gains in Asia on Thursday as jobs data lent a hand and despite weaker than expected retails ales and industrial output from top trading partner China. China reported industrial production for November came in at a gain of 6.1%, compared with a 6.2% rise seen followed by retail sales which rose 10.2%, compared to a 10.3% rise expected and fixed asset investment came in up 7.2% as seen. Earlier, Australia reported employment change data for November showed job jumped by 61,600 with a gain of 19,200 jobs expected and under a steady unemployment rate of 5.4% and participation rate of 65.5%, higher than the 65.1% seen. The Federal Reserve approved its third rate hike of 2017, and forecasts further rate hikes despite growing concerns over the slow pace of inflation. Fed officials also expressed optimism in the economy, hiking their projection for economic growth in 2017 to 2.5%, while growth in 2018 was expected to rise to 2.5%, a 0.4% increase from the Fed’s September projections. The report raised investor expectations for ongoing bullish economic growth, lifting sentiment on riskier assets like equities. Overnight, the dollar eased from three-week highs after economic data pointing to ongoing inflation weakness eased expectations of the Federal Reserve adopting a more aggressive stance on monetary policy next year. The Labor Department said on Wednesday its Consumer Price index rose 0.4% last month. In the twelve months through November, core-inflation, however, undershot expectations rising just 1.7%.
  • Oil markets rose on Thursday, lifted by a fourth straight weekly fall in U.S. crude inventories, though climbing output capped prices well below the 2015 highs reached earlier this week. U.S. crude oil stockpiles fell by 5.1 mn barrels in the week to Dec. 8, the fourth consecutive week of decline, to 442.99 mn barrels, lowest since October 2015. Despite the price gain, Brent was well below $65.83 a barrel, the June 2015 high touched earlier this week. It hit that level after the Forties pipeline - which carries significant amounts of the North Sea crude used to underpin Brent crude futures - was shut down due to cracks. The IEA has said it saw no immediate need to act, for instance with the release of strategic stockpiles, as the market remains well supplied. Another cap on prices has been soaring U.S. oil production, which has risen by 16 percent since mid-2016 to 9.78 mn BPD, the highest since the early 1970s and close to levels from top producers Russia and Saudi Arabia. Singapore's OCBC bank said on Thursday in its 2018 commodities outlook that a "further rise in prices could well be met by stronger U.S. production as shale oil players turn taps on", suggesting oil prices may not rise too far in 2018. Inventories of U.S. crude fell by roughly 5.1 mn barrels for the week ended Dec. 8, beating expectations of a draw of 3.8 mn barrels. Gasoline inventories – one of the products that crude is refined into – rose by 5.7 mn barrels, well above expectations for rise of 2.5 mn barrels, while supplies of distillate – the class of fuels that includes diesel and heating oil – fell by about 1.4 mn barrels, above expectations for a build of 902,000 barrels. Also weighing on crude prices was a rise in production to record highs as data showed weekly U.S. crude production jumped by 73k barrels a day to 9.78mn bpd. The EIA’s report comes after OPEC revealed in its monthly report that production in November, fell by 133k bpd to 32.5 million bpd but revised upward its 2018 forecast for non-OPEC output. OPEC forecasts non-OPEC supply growth to rise by 120k bpd to 990k bpd. The oil-cartel said, however, that the 2018 forecast for non-OPEC supply is “associated with considerable uncertainties”. US oil supply is now expected to grow by 1.1 mn bpd in 2018, an upward revision of 180k barrels, according to the report.

 

 
Intraday RESISTANCE LEVELS
14th December 2017 R1 R2 R3
GOLD-XAU 1,260 1,266 1,272-1,280
Silver-XAG 16.35 16.50-16.90 17.20
Crude Oil 57.00 58.50-59.00 59.90
EURO/USD 1.1850 1.19001.1900 1.1990-1.2050
GBP/USD 1.3590 1.3590 1.3650
USD/JPY 113.00 114.00 114.75-115.50

Intraday SUPPORTS LEVELS
14th December 2017 S1 S2 S3
GOLD-XAU 1,254-1,248 1,239 1,230
Silver-XAG 70-15.30 15.00 14.60-14.30
Crude Oil 56.00 55.40-54.70 54.00
EURO/USD 1.1790 1.1750 1.1700-1.1650
GBP/USD 1.3400-1.3360 1.3300 1.3260-1.3190
USD/JPY 112.50 111.90-111.00 110.20

Intra-Day Strategy (14th December 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 Wednesday made its intraday high of US$1256.95/oz and low of US$1240.16/oz. Gold was up by 0.934% at US$1255.51/oz.

Technicals in Focus:

In daily charts, prices are below 200DMA (1267) and breakage above will call for 1280-1290. 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 1254-1280 keeping stop loss closing above 1280 and targeting 1246-1239 and 1230-1224. Buy above 1246-1224 with risk below 1224, targeting 1254-1266-1274 and 1284-1290-1300.

 
Intraday Support Levels
S1     1,254-1,248
S2     1,239
S3     1,230
Intraday Resistance Levels
R1     1,260
R2     1,266
R3     1,272-1,280

Technical Indicators

Name   Value Action
14DRSI  

42.778

Buy
20-DMA   1272.42 Sell
50-DMA  

1278.73

Sell
100-DMA   1286.50 Sell
200-DMA   1267.43 Buy
STOCH(5,3)   29.335 Sell
MACD(12,26,9)   -9.075 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$16.13/oz and low of US$15.66/oz. Silver settled up by 2.29% at US$16.06/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 16.35-15.00 targeting 16.50-16.90-17.20 and 17.50-18.00; stop breakage below 15.00. Sell below 16.50-18.00 with stop loss above 18.00; targeting 16.50-16.00 and 15.60-15.00.

 
Intraday  Support Levels
S1     70-15.30
S2     15.00
S3     14.60-14.30

Intraday  Resistance Levels
R1     16.35
R2     16.50-16.90
R3     17.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.489 Buy
20-DMA   16.45 Sell
50-DMA   16.78 Sell
100-DMA   16.94 Sell
200-DMA   16.99 Sell
STOCH(5,3)   65.557 Buy
MACD(12,26,9)   -0.294 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$57.80/bbl, intraday low of US$56.53/bbl and settled down by 1.271% to close at US$56.68/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 57.00-61.00 with stop loss at 61.00; targeting and 56.00-55.40 and 54.70-54.00. Buy above 56.00-54.00 with risk daily closing below 54.00 and targeting 57.00-58.50-59.00 and 59.60-61.00.

 
Intraday Support Levels
S1     56.00
S2     55.40-54.70
S3     54.00

Intraday Resistance Levels
R1     57.00
R2     58.50-59.00
R3     59.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.366 Sell
20-DMA   57.39 Buy
50-DMA   55.11 Buy
100-DMA   52.09 Buy
200-DMA   50.04 Buy
STOCH(5,3)   35.647 Sell
MACD(12,26,9)   0.453 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1728/EUR, high of US$1.1830/EUR and settled the day up by 0.715% to close at US$1.1825/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 1.1790-1.12090 targeting 1.1750-1.1700 and 1.1660-1.1590 with stop-loss at daily closing above 1.2090. Buy above 1.1850-1.1700 with risk below 1.1700 targeting 1.1790-1.1900-1.1990 and 1.2050-1.2090.

 
Intraday Support Levels
S1     1.1790
S2     1.1750
S3     1.1700-1.1650

Intraday  Resistance Levels
R1     1.1850
R2     1.19001.1900
R3     1.1990-1.2050

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.331 Buy
20-DMA   1.1821 Buy
50-DMA   1.1761 Sell
100-DMA   1.1803 Sell
200-DMA   1.1433 Buy
STOCH(5,3)   64.559 Sell
MACD(12,26,9)   -0.0010 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3302/GBP, high of US$1.3379/GBP and settled the day down by 0.157% to close at US$1.3382/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.3241) 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 1.3500-1.3660 with targets at 1.3425-1.3360 and 1.3300-1.3260- 1.3200. Buy above 1.3425-1.3200 with stop loss closing below 1.3200 targeting 1.3425-1.3500 and 1.3570-1.3650.

 
Intraday Support Levels
S1     1.3400-1.3360
S2     1.3300
S3     1.3260-1.3190

Intraday Resistance Levels
R1     1.3590
R2     1.3590
R3     1.3650

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

56.911

Buy
20-DMA   1.3369 Sell
50-DMA   1.3254 Sell
100-DMA   1.3194 Buy
200-DMA   1.2981 Buy
STOCH(5,3)   39.615 Sell
MACD(12,26,9)   -0.0046 Buy

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY112.53/USD and made an intraday high of JPY113.54/USD and settled the day down by 0.880% at JPY112.53/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 overbought territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 114.00-116.00 with risk above 116.000 targeting 113.00-112.50-111.90 and 111.00-110.20. Long positions above 113.00-110.00 with targets of 114.00-114.75 and 115.50-116.00 with stop below 116.00.

 
Intraday Support Levels
S1     112.50
S2     111.90-111.00
S3     110.20

INTRADAY RESISTANCE LEVELS
R1     113.00
R2     114.00
R3     114.75-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.398 Buy
20-DMA   112.31 Buy
50-DMA   112.86 Buy
100-DMA   111.67 Buy
200-DMA   111.63 Buy
STOCH(9,6)   46.940 Sell
MACD(12,26,9)   0.0823 Sell

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