AAFX TRADING

Daily Market Lookup

  • Asian shares pushed higher on Tuesday, erasing early modest losses while the euro stood near a 3-year peak on rising expectations that the European Central Bank could pare its monetary stimulus. U.S. markets were closed for a public holiday on Monday. Chinese iron ore futures tumbled 2 percent on Monday, as stockpiles of the steelmaking commodity at China’s ports surged to the highest since at least 2004, with weaker steel prices also adding pressure. The euro blipped higher on Monday and German benchmark bond yields hit session highs after European Central Bank rate-setter Ardo Hansson said the central bank could end its bond purchase scheme in one go after September if the economy and inflation develop as expected. Adding to the euro’s ascent, data showed the trade surplus in the 19-country euro area rose to its highest level in eight months, indicating companies were so far weathering the impact of a stronger currency. Japanese Finance Minister Taro Aso said on Tuesday that he did not see problems with the dollar weakening to around 110.80 yen, but that big swings in currencies would be problematic. China’s economy is expected to cool this year as a government-led crackdown on debt risks and factory pollution drag on overall activity, a Reuters poll showed on Tuesday Beijing is in the second year of a relentless campaign to wean China off its debt-heavy investment model, clamping down on everything from speculative property lending to shadow-bank financing activities as policy makers look to foster sustainable longer term growth. That has pushed up borrowing costs and taken some of the momentum off the world’s second-largest economy, especially in the final months of 2017, with growth forecast at 6.5 percent this year, according to economists from 70 institutions surveyed by Reuters. It was slightly above the poll’s October forecast of 6.4 percent expansion, but would still lag the survey’s 2017 projection of a 6.8 percent gross domestic product increase.
  • Gold prices rose in Asia on Tuesday as the market shrugged off signs of tighter monetary policies ahead for the Bank of Japan and European Central Bank and took advantage of a weaker dollar trend to buy the greenback-denominated commodity. Overnight, gold prices remained supported at four-month highs on Monday, as demand for the U.S. dollar continued to broadly weaken. The dollar shrugged off data on Friday showing that underlying U.S. consumer prices recorded their largest increase in 11 months in December, adding to expectations that inflation will accelerate this year. Gold is sensitive to moves in the dollar. A weaker dollar makes gold less expensive for holders of foreign currency. Gold traded with a mild positive bias for the fifth consecutive session and remained within striking distance of 4-month tops, touched in the previous session. The precious metal built on its strong up-move from December's near 5-month lows and continued benefitting from the recent US Dollar slump, despite growing expectations for a gradual Fed monetary policy tightening through 2018 Even expectations of tighter monetary policies from the BOJ and ECB did little to dampen demand for the non-yielding yellow metal, with the prevalent strong USD bearish sentiment supportive of the strong bullish momentum for the dollar-denominated commodity.
  • Brent crude prices consolidated recent gains at around $70 a barrel on Tuesday, a level not seen since 2014’s dramatic oil market slump. Prices have been driven up by production curbs in OPEC nations and Russia, as well by strong demand thanks to healthy economic growth. Oil has been pushed higher by an effort led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia to withhold production since January last year. The cuts are set to last through 2018. The restraint has coincided with healthy oil demand, pushing up crude by almost 15 percent since early December. Other U.S. banks, including Bank of America Merrill Lynch and Morgan Stanley, have already upped their price forecasts. “We have updated our supply/demand balances to reflect a faster-than-expected tightening in the global oil market due to improving cyclical conditions, cold winter weather, and higher than expected OPEC compliance,” Bank of America Merrill Lynch said. “We now see a deficit of 430,000 barrels per day (bpd) in 2018 compared to 100,000 bpd prior, and thus see Brent crude oil prices averaging $64 per barrel in 2018 compared to $56 prior. Our WTI projection also moves up from $52 per barrel to $60 per barrel for the same reasons,” the bank said. Morgan Stanley said “oil markets were 0.5 million bpd undersupplied in 2017,” adding that 2018 would still see a 200,000 bpd deficit. It expected Brent to rise to around $75 per barrel by the third quarter of this year. A major factor holding back crude prices in 2017, the surge in U.S. production, has stalled at least temporarily as icy winter weather in North America has shut down some facilities Instead of hitting 10 million bpd this month, as widely expected, U.S. production C-OUT-T-EIA fell from 9.8 million bpd in December to 9.5 million bpd currently. However, most analysts still expect U.S. production to break through 10 million bpd soon.

 

 
Intraday RESISTANCE LEVELS
16th January 2018 R1 R2 R3
GOLD-XAU 1,349 1,358-1366 1,376
Silver-XAG 17.45-17.70 18.08 18.60
Crude Oil 64.75-65.30 66.00 66.9
EURO/USD 1.2290-1.2360 1.2420 1.2500
GBP/USD 1.3820 1.3900 1.3975
USD/JPY 111.00-111.60 112.00 112.50-113.20

Intraday SUPPORTS LEVELS
16th January 2018 S1 S2 S3
GOLD-XAU 1,336 1,326-1,320 1,309
Silver-XAG 17.10 16.70 16.35-15.80
Crude Oil 64.20 63.50 63.00-62.50
EURO/USD 1.2200 1.2160-1.2095 1.1990
GBP/USD 1.3750 1.3700-1.3650 1.3590
USD/JPY 110.50 110.10-109.20 108.50

Intra-Day Strategy (16th 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 Monday made its intraday high of US$1344.64/oz and low of US$1335.77/oz. Gold was up by 0.276% at US$1339.99/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 1349-1375 keeping stop loss closing above 1375 and targeting 1336-1326-1320 and 1309-1300. Buy above 1336-1300 with risk below 1300, targeting 1349-1357 and 1366-1376.

 
Intraday Support Levels
S1     1,336
S2     1,326-1,320
S3     1,309
Intraday Resistance Levels
R1     1,349
R2     1,358-1366
R3     1,376

Technical Indicators

Name   Value Action
14DRSI  

74.860

Buy
20-DMA   1298.73 Sell
50-DMA  

1284.01

Sell
100-DMA   1290.87 Sell
200-DMA   1273.96 Buy
STOCH(5,3)   74.849 Buy
MACD(12,26,9)   16.025 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$17.15/oz and low of US$16.92/oz. Silver settled up by 0.814% at US$17.13/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 17.10-14.60 targeting 17.45-17.75 and 18.00-18.30-18.60; stop breakage below 14.60. Sell below 17.45-18.60 with stop loss above 18.60; targeting 17.10-16.70-16.35 and 15.80-15.00.

 
Intraday  Support Levels
S1     17.10
S2     16.70
S3     16.35-15.80

Intraday  Resistance Levels
R1     17.45-17.70
R2     18.08
R3     18.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.729 Buy
20-DMA   16.81 Sell
50-DMA   16.68 Sell
100-DMA   16.93 Sell
200-DMA   16.89 Sell
STOCH(5,3)   86.868 Sell
MACD(12,26,9)   0.210 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$64.87/bbl, intraday low of US$64.07/bbl and settled up by 0.605% to close at US$64.79/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 64.75-66.90 with stop loss at 67.00; targeting and 64.20-63.50 and 63.00-62.50-61.90. Buy above 64.20-62.50 with risk daily closing below 62.50 and targeting 64.75-65.30 and 66.00-66.90.

 
Intraday Support Levels
S1     64.20
S2     63.50
S3     63.00-62.50

Intraday Resistance Levels
R1     64.75-65.30
R2     66.00
R3     66.9

TECHNICAL INDICATORS
Name   Value Action
14DRSI   79.564 Sell
20-DMA   61.04 Buy
50-DMA   58.67 Buy
100-DMA   54.67 Buy
200-DMA   51.25 Buy
STOCH(5,3)   89.820 Buy
MACD(12,26,9)   1.859 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.2186/EUR, high of US$1.2296/EUR and settled the day up by 0.565% to close at US$1.2262/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 1.2290-1.2420 targeting 1.2200-1.2160 and 1.2095-1.1990-1.1900 with stop-loss at daily closing above 1.2420. Buy above 1.2200-1.1990 with risk below 1.1990 targeting 1.2230-1.2300 and 1.2360-1.2420.

 
Intraday Support Levels
S1     1.2200
S2     1.2160-1.2095
S3     1.1990

Intraday  Resistance Levels
R1     1.2290-1.2360
R2     1.2420
R3     1.2500

TECHNICAL INDICATORS
Name   Value Action
14DRSI   73.518 Buy
20-DMA   1.1984 Buy
50-DMA   1.1858 Sell
100-DMA   1.1841 Sell
200-DMA   1.1564 Buy
STOCH(5,3)   91.876 Buy
MACD(12,26,9)   0.0094 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3722/GBP, high of US$1.3819/GBP and settled the day up by 0.458% to close at US$1.3789/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 overbought territory and giving positive crossover to confirm bullish 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 1.3820-1.3975 with targets at 1.3750-1.3700-1.3650 and 1.3590-1.3500. Buy above 1.3750-1.3500 with stop loss closing below 1.3500 targeting 1.3820 and 1.3900-1.3975.

 
Intraday Support Levels
S1     1.3750
S2     1.3700-1.3650
S3     1.3590

Intraday Resistance Levels
R1     1.3820
R2     1.3900
R3     1.3975

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

72.078

Buy
20-DMA   1.3513 Sell
50-DMA   1.3387 Sell
100-DMA   1.3304 Buy
200-DMA   1.3096 Buy
STOCH(5,3)   91.958 Buy
MACD(12,26,9)   0.0093 Buy

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY111.32/USD and made an intraday high of JPY111.17/USD and settled the day down by 0.495% at JPY110.52/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 111.00-114.00 with risk above 114.00 targeting 111.00-110.10 and 109.20-108.0. Long positions above 111.00-108.50 with targets of 111.60-112.50 and 113.20-114.00-114.75 with stop below 110.00.

 
Intraday Support Levels
S1     110.50
S2     110.10-109.20
S3     108.50

INTRADAY RESISTANCE LEVELS
R1     111.00-111.60
R2     112.00
R3     112.50-113.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   33.831 Buy
20-DMA   112.44 Buy
50-DMA   112.57 Buy
100-DMA   112.20 Buy
200-DMA   111.68 Buy
STOCH(9,6)   10.227 Buy
MACD(12,26,9)   -0.464 Sell

AAFX TRADING
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