AAFX TRADING

Daily Market Lookup

  • Asian shares inched closer to a record high on Friday as U.S. jobs data pointed to firm economic growth although the greenback was soft as the specter of benign inflation capped domestic bond yields. The U.S. ADP National Employment Report on Thursday showed U.S. private employers added 250,000 jobs USADP=ECI in December, the biggest monthly increase since March and well above economists’ expectations of a rise of 190,000. The data also boosted expectations on Friday’s payroll data USNFAR=ECI by U.S. Labor Department, where economist have forecast nonfarm job growth of 190,000 in December. Despite signs of a strong U.S. labor market, the dollar was soft, hovering just above its three-month low against a basket of major currencies. Economists expect U.S. wages to have risen 2.5 percent from a year earlier in December, the same as in November. But stronger-than-expected German inflation data published late last year is fueling speculation of a higher reading, which in turn could encourage expectations the European Central Bank may move faster to wind up its stimulus. Many emerging economy currencies have gained even more against the dollar this week as investors look for higher yields. But some market players also said market moves so far this year has been mostly driven by short-term speculators and many long-term investors were on sidelines, hampered not least by high valuations of stocks in U.S. and some other countries.
  • U.S. employers likely maintained a brisk pace of hiring in December while increasing wages for workers amid growing confidence in the economy, which could pave the way for the Federal Reserve to increase interest rates in March. Nonfarm payrolls probably increased by 190,000 jobs last month, according to a Reuters survey of economists, after a gain of 228,000 in November. Despite the anticipated moderation, employment gains would still be above the monthly average of 170,000 over the past three months. For all of 2017, the economy is expected to have created around 2 million jobs, slightly below the 2.2 million added in 2016. The Labor Department is due to release its closely watched employment report at 8:30 a.m. ET (1330 GMT) on Friday. Job growth surged in October and November after being held back in September by back-to-back hurricanes, which destroyed infrastructure and homes and temporarily dislocated some workers in Texas and Florida. A solid employment report would add to the upbeat assessment of the economy signaled in housing, consumer spending and manufacturing data. Job growth in line with expectations could heighten criticism of a $1.5 trillion package of tax cuts passed by the Republican-controlled U.S. Congress and signed into law by President Donald Trump last month. The fiscal stimulus, which includes a sharp reduction in the corporate income tax rate to 21 percent from 35 percent, is occurring with the economy operating almost at capacity. There are concerns the economy could overheat. Economists expect job growth to slow this year as the labor market hits full employment, which will likely boost wage growth as employers compete for workers. The economy needs to create 75,000 to 100,000 jobs per month to keep up with growth in the working-age population. The unemployment rate is forecast to be unchanged at a 17-year low of 4.1 percent. With the December employment report, the Labor Department will incorporate annual revisions to the seasonally adjusted household survey data going back five years.
  • Oil prices fell on Friday, dropping away from highs last seen in 2015, as soaring production in the United States undermined the 10 percent rally from lows hit in December that was driven by tightening supply and political tensions in OPEC member Iran. A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. Traders said political tensions in Iran, third-largest producer in the OPEC, had pushed prices higher. Oil prices have received general support by production cuts led by OPEC and by Russia, which started in January last year and are set to last through 2018, as well as by strong economic growth and financial markets. This has helped tighten markets. U.S. commercial crude inventories C-STK-T-EIA fell by 7.4 mn barrels in the week to Dec. 29, to 424.46 million barrels, according to data from the EIA. That is down 20 percent from their historic peaks last March and close to the five-year average of 420 million barrels. Yet given Iran’s oil production has not been affected by the unrest, and that U.S. production C-OUT-T-EIA will likely break through 10 mn bpd soon, a level so far only reached by Saudi Arabia and Russia, doubts are emerging whether the bull-run can last.

 

 
Intraday RESISTANCE LEVELS
5th January 2018 R1 R2 R3
GOLD-XAU 1,320-1,326 1,334 1,340
Silver-XAG 17.10-17.50 18.08 18.60
Crude Oil 62.50-63.00 63.65 64.50
EURO/USD 1.2095-1.2150 1.2230 1.2300
GBP/USD 1.3550-1.3590 1.3650 1.3700-1.3750
USD/JPY 113.20 114.00 114.75-115.50

Intraday SUPPORTS LEVELS
5th January 2018 S1 S2 S3
GOLD-XAU 1,309 1,295-1,300 1,286
Silver-XAG 16.70 16.35-15.80 15.00
Crude Oil 61.90-61.00 60.50 59.90-59.00
EURO/USD 1.1990 1.1960 1.1900-1.1850
GBP/USD 1.3500-1.3450 1.3380 1.3320
USD/JPY 112.50 112.00-111.60 111.00

Intra-Day Strategy (5th January 2018)
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 Thursday made its intraday high of US$1325.88/oz and low of US$1305.75/oz. Gold was down by 0.774% at US$1322.56/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 1320-1340 keeping stop loss closing above 1340 and targeting 1309-1300-1294 and 1286-1280. Buy above 1309-1280 with risk below 1280, targeting 1320-1326 and 1334-1340.

 
Intraday Support Levels
S1     1,309
S2     1,295-1,300
S3     1,286
Intraday Resistance Levels
R1     1,320-1,326
R2     1,334
R3     1,340

Technical Indicators

Name   Value Action
14DRSI  

70.638

Buy
20-DMA   1275.70 Sell
50-DMA  

1277.76

Sell
100-DMA   1288.62 Sell
200-DMA   1271.75 Buy
STOCH(5,3)   83.567 Buy
MACD(12,26,9)   12.035 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$17.25/oz and low of US$16.96/oz. Silver settled up by 0.702% at US$17.20/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 overbought region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 16.70-14.60 targeting 17.10-17.50 and 18.00-18.30-18.60; stop breakage below 14.60. Sell below 17.10-18.00 with stop loss above 18.00; targeting 16.70-16.35-15.80-15.00.

 
Intraday  Support Levels
S1     16.70
S2     16.35-15.80
S3     15.00

Intraday  Resistance Levels
R1     17.10-17.50
R2     18.08
R3     18.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.270 Buy
20-DMA   16.37 Sell
50-DMA   16.65 Sell
100-DMA   16.92 Sell
200-DMA   16.93 Sell
STOCH(5,3)   85.240 Sell
MACD(12,26,9)   -0.172 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$62.19/bbl, intraday low of US$61.57/bbl and settled down by 0.032% to close at US$61.91/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 62.70-64.50 with stop loss at 64.50; targeting and 61.90-61.00-60.50 and 59.90-59.00. Buy above 61.90-59.00 with risk daily closing below 59.00 and targeting 62.50-63.00 and 63.65-64.50.

 
Intraday Support Levels
S1     61.90-61.00
S2     60.50
S3     59.90-59.00

Intraday Resistance Levels
R1     62.50-63.00
R2     63.65
R3     64.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   77.268 Sell
20-DMA   58.75 Buy
50-DMA   57.37 Buy
100-DMA   53.57 Buy
200-DMA   50.80 Buy
STOCH(5,3)   92.406 Sell
MACD(12,26,9)   1.304 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.2003/EUR, high of US$1.2088/EUR and settled the day up by 0.449% to close at US$1.2067/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 1.12095-1.12300 targeting 1.2050-1.1990 and 1.1900-1.1850-1.1790 with stop-loss at daily closing above 1.2090. Buy above 1.1990-1.1700 with risk below 1.1700 targeting 1.2090-1.2150 and 1.2230-1.2300.

 
Intraday Support Levels
S1     1.1990
S2     1.1960
S3     1.1900-1.1850

Intraday  Resistance Levels
R1     1.2095-1.2150
R2     1.2230
R3     1.2300

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.554 Buy
20-DMA   1.1876 Buy
50-DMA   1.1796 Sell
100-DMA   1.1821 Sell
200-DMA   1.1514 Buy
STOCH(5,3)   82.167 Sell
MACD(12,26,9)   0.0059 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3504/GBP, high of US$1.3559/GBP and settled the day up by 0.244% to close at US$1.3546/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 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 1.3550-1.3700 with targets at 1.3500-1.3450-1.3400 and 1.3350-1.3300. Buy above 1.3500-1.3320 with stop loss closing below 1.3300 targeting 1.3550-1.3590 and 1.3650-1.3750.

 
Intraday Support Levels
S1     1.3500-1.3450
S2     1.3380
S3     1.3320

Intraday Resistance Levels
R1     1.3550-1.3590
R2     1.3650
R3     1.3700-1.3750

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

63.306

Buy
20-DMA   1.3425 Sell
50-DMA   1.3322 Sell
100-DMA   1.3249 Buy
200-DMA   1.3055 Buy
STOCH(5,3)   68.883 Sell
MACD(12,26,9)   0.0057 Buy

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY112.46/USD and made an intraday high of JPY112.86/USD and settled the day up by 0.204% at JPY112.72/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 113.20-115.50 with risk above 115.50 targeting 112.50-112.00 and 111.60-111.00. Long positions above 112.50-111.00 with targets of 113.20-114.00 and 114.75-115.50 with stop below 110.00.

 
Intraday Support Levels
S1     112.50
S2     112.00-111.60
S3     111.00

INTRADAY RESISTANCE LEVELS
R1     113.20
R2     114.00
R3     114.75-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.841 Buy
20-DMA   112.95 Buy
50-DMA   112.89 Buy
100-DMA   112.05 Buy
200-DMA   111.66 Buy
STOCH(9,6)   58.061 Sell
MACD(12,26,9)   0.024 Sell

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