AAFX TRADING

Daily Market Lookup

  • Asian shares rose on Wednesday with oil and copper prices rocketing to multi-year highs in an uplifting sign for global growth and inflation, while major currencies were becalmed in a holiday-shortened week. A gauge of world shares hovered near record highs, after gaining in every single month this year. The gains in Asia came as copper - widely regarded as a barometer of global growth - jumped for a ninth straight session to a 3-1/2 year peak on expectations of strong demand from China. Oil was equally robust, but it was supply fears that kept it near its highest since mid-2015. Chinese customs data released on Tuesday showed that the country’s refined copper imports leapt 19 percent in November from a year earlier. In addition, Asian suppliers of iPhone enjoyed a stellar rebound after sliding earlier this week on a report suggesting weaker demand for iPhoneX. Taiwan’s Pegatron Corp and Hon Hai climbed more than 1 percent, while Apple Inc’s rival Samsung Electronics rose more 2 percent. The U.S. Federal Reserve raised rates three times this year and is set to deliver further hikes in 2018. The European Central Bank is expected to finally begin clawing back its monetary stimulus and tighten policy after keeping the deposit rate below zero since 2014.
  • Investors who bet on private prison operators as big winners from Donald Trump’s tough line on crime and illegal immigration are looking back at a bruising year of high hopes and disappointment. Some, however, say the stocks still offer good value even though an anticipated windfall under the Trump administration so far has failed to materialize. Valuable properties owned by the two companies, which operate as prison real estate investment trusts (REITs), and long-term federal contracts with minimum revenue guarantees also make them attractive, they say. The administration’s proposals to bolster the U.S. Immigration and Customs Enforcement agency could help in the future though it is still unclear how much new money it will bring. Geo and CoreCivic shares soared after Trump won the White House, partly on expectations that detention centers they run for ICE would fill up thanks to an anticipated surge in arrests along the Mexican border. Investors say lack of clarity on how much business they will get from ICE, the companies’ biggest client, is holding the shares back.
  • Gold prices rose modestly on Tuesday as buyers returned amid continued dollar weakness continued. Gold’s bullish start to the week comes as data showed traders increased their bullish bets on the previous metal last week. U.S. Commodity Futures Trading Commission (CFTC) on Friday reported that hedge funds and money managers had increased their net long stance in gold in the week ended Dec. 19 to 113,800, up 6,700 or 6 .3% from last week's twenty-week low. Gold notched a second-straight weekly gain last week, closing above its 200-day moving average, a key technical indicator, in a sign of bullish momentum. Goldman Sachs, however, warned recently that it expects gold prices to slide to around $1,200 a troy ounce in the middle of 2018 as general marketplace fears subside, but then to rise to $1,375 by the end of 2020 as demand from emerging-market nations grows.
  • The dollar eased against a basket of currencies on Wednesday, while commodity-linked currencies such as the Canadian dollar were underpinned by this week's rally in oil prices. Oil prices had surged to 2-1/2 year highs on Tuesday, boosted by news of an explosion on a Libyan crude pipeline as well as voluntary OPEC-led supply cuts. Monetary policy convergence could weigh on the dollar next year, now that central banks other than the U.S. Federal Reserve have either begun moving away from monetary stimulus, or started to raise interest rates, said Peter Chia, FX strategist for United Overseas Bank in Singapore. Against this backdrop, Japanese policymakers may at least start dropping more hints about an eventual tightening of the Bank of Japan's monetary policy, Chia said, adding that the dollar could slip to 108 yen by the end of March. A speech by BOJ Governor Haruhiko Kuroda in November had stirred speculation that the BOJ could edge away from crisis-mode stimulus earlier than expected. That was when he mentioned the concept of a "reversal rate" - a level at which low interest rates start to have more harmful side-effects than benefits. Kuroda, however, said last week after the BOJ kept policy steady that economic improvements alone would not trigger a withdrawal of stimulus, reinforcing expectations that the BOJ was in no hurry to move away from its ultra-loose monetary policy.

 

 
Intraday RESISTANCE LEVELS
27th December 2017 R1 R2 R3
GOLD-XAU 1,286 1,295 1,300-1,309
Silver-XAG 16.50-16.90 17.20 17.45
Crude Oil 59.90-60.50 61.00 61.90
EURO/USD 1.1900-1.1960 1.1990 1.2050
GBP/USD 1.3400 1.3450-1.3500 1.3590
USD/JPY 114.00 114.75-115.50 116.00

Intraday SUPPORTS LEVELS
27th December 2017 S1 S2 S3
GOLD-XAU 1,280-1,272 1,266 1,260-1,254
Silver-XAG 16.35-15.80 15.30 16.50-16.90
Crude Oil 59.00 58.20 57.40-57.00
EURO/USD 1.1850-1.1790 1.1750 1.1700-1.1650
GBP/USD 1.3350 1.3300 1.3260-1.3190
USD/JPY 113.20 112.50 112.00-111.60

Intra-Day Strategy (27th 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 Monday made its intraday high of US$1283.70/oz and low of US$1276.92/oz. Gold was up by 0.357% at US$1282.72/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 overbought territory and giving positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1286-1309 keeping stop loss closing above 1309 and targeting 1280-1274-1260 and 1254-1246-1236. Buy above 1280-1240 with risk below 1240, targeting 1286-1294-and 1300-1309.

 
Intraday Support Levels
S1     1,280-1,272
S2     1,266
S3     1,260-1,254
Intraday Resistance Levels
R1     1,286
R2     1,295
R3     1,300-1,309

Technical Indicators

Name   Value Action
14DRSI  

59.459

Buy
20-DMA   1264.15 Sell
50-DMA  

1274.01

Sell
100-DMA   1286.76 Sell
200-DMA   1269.82 Buy
STOCH(5,3)   94.965 Buy
MACD(12,26,9)   -0.499 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$16.55/oz and low of US$16.38/oz. Silver settled up by 0.793% at US$16.52/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 16.35-14.60 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 16.30-16.00 and 15.60-15.00-14.60.

 
Intraday  Support Levels
S1     16.35-15.80
S2     15.30
S3     16.50-16.90

Intraday  Resistance Levels
R1     16.50-16.90
R2     17.20
R3     17.45

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.938 Buy
20-DMA   16.12 Sell
50-DMA   16.64 Sell
100-DMA   16.91 Sell
200-DMA   16.96 Sell
STOCH(5,3)   92.022 Sell
MACD(12,26,9)   -0.182 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$59.99/bbl, intraday low of US$58.30/bbl and settled up by 2.25% to close at US$59.79/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 approaching oversold 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 59.90-61.90 with stop loss at 61.90; targeting and 59.00-58.20 and 57.40-56.00. Buy above 59.00-56.00 with risk daily closing below 56.00 and targeting 59.90-60.50 and 61.00-61.90.

 
Intraday Support Levels
S1     59.00
S2     58.20
S3     57.40-57.00

Intraday Resistance Levels
R1     59.90-60.50
R2     61.00
R3     61.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   68.555 Sell
20-DMA   57.65 Buy
50-DMA   56.30 Buy
100-DMA   52.80 Buy
200-DMA   50.41 Buy
STOCH(5,3)   92.867 Sell
MACD(12,26,9)   0.755 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1845/EUR, high of US$1.1878/EUR and settled the day down by 0.0842% to close at US$1.1857/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 1.1900-1.12050 targeting 1.1850-1.1790-1.1750 and 1.1700-1.1660 with stop-loss at daily closing above 1.2050. Buy above 1.1850-1.1650 with risk below 1.1650 targeting 1.1900-1.1960-1.1990 and 1.2050-1.2090.

 
Intraday Support Levels
S1     1.1850-1.1790
S2     1.1750
S3     1.1700-1.1650

Intraday  Resistance Levels
R1     1.1900-1.1960
R2     1.1990
R3     1.2050

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.581 Buy
20-DMA   1.1825 Buy
50-DMA   1.1767 Sell
100-DMA   1.1806 Sell
200-DMA   1.1461 Buy
STOCH(5,3)   80.533 Sell
MACD(12,26,9)   0.0014 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.3346/GBP, high of US$1.3386/GBP and settled the day up by 0.0074% to close at US$1.3373/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.3263) 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 1.3400-1.3660 with targets at 1.3300-1.3260 and 1.3200-1.3115. Buy above 1.3300-1.3115 with stop loss closing below 1.3115 targeting 1.3400-1.3500 and 1.3590-1.3650.

 
Intraday Support Levels
S1     1.3350
S2     1.3300
S3     1.3260-1.3190

Intraday Resistance Levels
R1     1.3400
R2     1.3450-1.3500
R3     1.3590

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

52.434

Buy
20-DMA   1.3397 Sell
50-DMA   1.3207 Sell
100-DMA   1.3146 Buy
200-DMA   1.3014 Buy
STOCH(5,3)   54.611 Buy
MACD(12,26,9)   -0.0031 Buy

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY113.11/USD and made an intraday high of JPY113.32/USD and settled the day down by 0.044% at JPY113.22/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (111.61), 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 116.00 targeting 113.20-112.50-112.00 and 111.60-111.00. Long positions above 113.20-111.60 with targets of 113.00-114.00 and 114.75-115.50 with stop below 110.00.

 
Intraday Support Levels
S1     113.20
S2     112.50
S3     112.00-111.60

INTRADAY RESISTANCE LEVELS
R1     114.00
R2     114.75-115.50
R3     116.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.752 Buy
20-DMA   112.65 Buy
50-DMA   112.93 Buy
100-DMA   111.82 Buy
200-DMA   111.60 Buy
STOCH(9,6)   84.951 Buy
MACD(12,26,9)   0.152 Sell

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