AAFX TRADING

Daily Market Lookup

  • Asian stocks struck record highs on Thursday, with a rally by Wall Street supporting bullish investor sentiment, while the dollar pulled back from three-year lows as comments by European Central Bank officials tempered the euro’s recent rally. Optimism over prospects for sustained strong global growth and improved corporate earning shave helped share markets rally at the start of 2018. Near-term market focus was on China’s gross domestic product data due at 0700 GMT. Analysts polled by Reuters expect the world’s second-largest economy to have grown 6.7 percent in the October-December quarter from a year earlier, slowing from a rise of 6.8 percent in the previous quarter. The euro was little changed at $1.2188 EUR=, slipping from a three-year peak above $1.2300 after some ECB officials voiced worries about the currency's strength. The common currency had advanced this month on expectations that the central bank would take steps towards winding back on stimulus measures to normalize monetary policy. Gold prices fell in Asia on Thursday in profit taking and after a mild dollar rebound overnight. Overnight, gold prices remained close to four-month highs on Wednesday amid expectations the precious metal would likely ‘shrug off’ rate hike worries while dollar weakness limited downside. In a rising interest rate environment, investor appetite for gold weakens as the opportunity cost of holding the precious metal increases relative to other interest-nearing assets such as bonds.
  • Economic data released through the Asian session this morning included December’s unemployment numbers out of Australia, finalized industrial production figures out of Japan together with house price figures out of the UK, which had little impact on the Pound. Elsewhere, the Yen was down 0.06% to ¥111.36 against the Dollar. The Yen was largely unmoved by the release of the finalized industrial production figures, which reported a 0.5% rise, falling short of a prelim 0.6% increase with the “risk on” sentiment easing demand for the safe havens, which was also reflected in gold prices that were on the retreat through the early part of the day. There are no material stats scheduled for release out of the Eurozone today, which will leave the EUR in the hands of market risk appetite through the European session and any updates on coalition talks in Germany, with questions continuing to be raised over Merkel’s future as Chancellor. It’s also a quiet day for the Pound, with no material stats scheduled for release, leaving direction in the hands of the EU (Withdrawal) Bill that goes to the House of Lords following last night’s House of Commons vote in favour of the Bill. Concerns over the House of Lords holding up the bill may weigh on the Pound, with any chatter on Brexit likely to provide further direction through the day. Across the Pond, economic data out of the U.S includes December housing sector data, January’s Philly FED Manufacturing PMI numbers and the weekly jobless claims data. Forecasts are for the numbers to be Dollar negative, with the key driver this afternoon being the PMI numbers. A better than expected figure will provide some much needed support, with the Dollar on the back foot this morning, the Dollar Spot Index down 0.23% to 90.770. For the Loonie, stats are limited to December’s ADP nonfarm employment change figures, which will provide some direction, though any material gains off the back of positive numbers would be short lived ahead of the next round of NAFTA talks next week. At the time of writing, the U.S Dollar was up 0.06% to $1.2446 against the Loonie, with Wednesday’s dovish rate hike providing little support early on.
  • Oil prices rose on Thursday on a reported decline in U.S. crude inventories, and as rebels in Nigeria threatened to attack the country’s petroleum infrastructure. However, prices stayed below recent three-year highs as fuel supplies remain ample and as refineries scaled back operations. Traders said prices had been pushed up after reports that Nigeria’s militant group Niger Delta Avengers threatened to launch attacks on the country’s oil sector in the next few days. U.S. crude inventories fell by 5.1 mn barrels in the week ended Jan. 12 to 411.5 mn, according to the American Petroleum Institute on Wednesday. The tighter supplies come on the back of supply cuts by the OPEC and Russia, who started to withhold production in January last year. The cuts are set to last through 2018. Despite this, analysts warned that the recent oil price rally, which has lifted crude by around 14 percent since early December, may be about to run out of steam. The API data also showed a well supplied fuel product market, which could mean lower crude demand going forward. U.S. refinery crude runs fell by 420,000 bpd and refined product stocks rose, implying a well supplied market. Gasoline stocks rose by 1.8 million barrels while distillate fuels stockpiles, which include diesel and heating oil, climbed by 609,000 barrels, the API data showed. Official U.S. oil inventory and production data is due on Thursday from the EIA.

 

 
Intraday RESISTANCE LEVELS
18th January 2018 R1 R2 R3
GOLD-XAU 1,335-1,340 1,349 1,358-1366
Silver-XAG 17.45-17.70 18.08 18.60
Crude Oil 64.20 64.75-65.30 66.00
EURO/USD 1.2290-1.2360 1.2420 1.2500
GBP/USD 1.3820-1.3900 1.3975 1.4050
USD/JPY 111.60 112.00 112.50-113.20

Intraday SUPPORTS LEVELS
18th January 2018 S1 S2 S3
GOLD-XAU 1,326-1,320 1,309 1,300
Silver-XAG 17.00 16.70 16.35-15.80
Crude Oil 63.50 63.00-62.50 61.50
EURO/USD 1.2200 1.2160-1.2095 1.1990
GBP/USD 1.3750 1.3700-1.3650 1.3590
USD/JPY 111.00-110.50 110.10 109.20-108.50

Intra-Day Strategy (18th 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 Wednesday made its intraday high of US$1343.87/oz and low of US$1326.15/oz. Gold was up by 0.904% at US$1326.15/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 neutral territory and giving negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above; sell below 1340-1375 keeping stop loss closing above 1375 and targeting 1335-1326-1320 and 1309-1300. Buy above 1335-1300 with risk below 1300, targeting 1340-1349-1357 and 1366-1376.

 
Intraday Support Levels
S1     1,326-1,320
S2     1,309
S3     1,300
Intraday Resistance Levels
R1     1,335-1,340
R2     1,349
R3     1,358-1366

Technical Indicators

Name   Value Action
14DRSI  

64.554

Buy
20-DMA   1309.46 Sell
50-DMA  

1287.34

Sell
100-DMA   1291.70 Sell
200-DMA   1275.12 Buy
STOCH(5,3)   54.681 Sell
MACD(12,26,9)   16.537 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$17.27/oz and low of US$16.97/oz. Silver settled down by 1.107% at US$16.97/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 neutral 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 17.00-14.60 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     17.00
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   55.910 Buy
20-DMA   16.89 Sell
50-DMA   16.68 Sell
100-DMA   16.92 Sell
200-DMA   16.88 Sell
STOCH(5,3)   45.149 Sell
MACD(12,26,9)   0.192 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$64.15/bbl, intraday low of US$63.29/bbl and settled up by 0.313% to close at US$63.87/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 64.20-66.90 with stop loss at 67.00; targeting and 63.50-63.00 and 62.50-61.90-61.50. Buy above 63.50-61.50 with risk daily closing below 61.50 and targeting 64.20-64.75-65.30 and 66.00-66.90.

 
Intraday Support Levels
S1     63.50
S2     63.00-62.50
S3     61.50

Intraday Resistance Levels
R1     64.20
R2     64.75-65.30
R3     66.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   70.954 Sell
20-DMA   61.32 Buy
50-DMA   58.79 Buy
100-DMA   54.84 Buy
200-DMA   51.31 Buy
STOCH(5,3)   66.121 Sell
MACD(12,26,9)   1.757 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.2176/EUR, high of US$1.2322/EUR and settled the day down by 0.611% to close at US$1.2184/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   66.114 Buy
20-DMA   1.2022 Buy
50-DMA   1.1882 Sell
100-DMA   1.1845 Sell
200-DMA   1.1580 Buy
STOCH(5,3)   72.154 Buy
MACD(12,26,9)   0.0097 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3755/GBP, high of US$1.3941/GBP and settled the day up by 0.261% to close at US$1.3826/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     1.3820-1.3900
R2     1.3975
R3     1.4050

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

74.490

Buy
20-DMA   1.3558 Sell
50-DMA   1.3414 Sell
100-DMA   1.3322 Buy
200-DMA   1.3110 Buy
STOCH(5,3)   80.378 Buy
MACD(12,26,9)   0.0111 Buy

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY110.18/USD and made an intraday high of JPY110.33/USD and settled the day down by 0.760% at JPY111.28/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     111.00-110.50
S2     110.10
S3     109.20-108.50

INTRADAY RESISTANCE LEVELS
R1     111.60
R2     112.00
R3     112.50-113.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.601 Buy
20-DMA   112.27 Buy
50-DMA   112.46 Buy
100-DMA   112.24 Buy
200-DMA   111.24 Buy
STOCH(9,6)   41.518 Buy
MACD(12,26,9)   -0.399 Sell

AAFX TRADING
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