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Daily Market Lookup

  • Asian stocks advanced on Tuesday after U.S. senators struck a deal to end a three-day government shutdown, sending Wall Street’s main indexes to record highs, while the dollar inched down against the yen after the Bank of Japan kept policy steady. U.S. lawmakers passed a short-term measure on Monday to fund the federal government through Feb. 8. World equity markets have been on a tear over the past year, buoyed by a synchronised uptick in global economic growth in a boon to corporate profits and stock valuations. The brief U.S. government shutdown put only a minor dent to equities, with Wall Street rallying to record highs overnight following the deal to end the impasse in Washington. In a widely expected move, the BOJ maintained its short-term interest rate target at minus 0.1 percent and a pledge to guide 10-year government bond yields around zero percent. The BOJ also said “inflation expectations have moved sideways recently,” offering a slightly more upbeat view than three months ago when it said they were on a weak note. Still, the central bank was seen to be significantly distant from its peers who were looking for ways out of unconventional monetary policies. The BOJ caused ripples in the markets earlier in January by slightly reducing the amount of longer-dated Japanese government bonds (JGBs) it buys from the market at its regular debt-purchasing operations. The yen appreciated significantly against the dollar as some interpreted the BOJ’s move as a step towards eventual policy normalisation. Focus was on BOJ Governor Haruhiko Kuroda’s post-policy meeting news conference at 0630 GMT and how he responds to questions about where the central bank stands on its projected policy path. The euro was supported ahead of the outcome of the European Central Bank’s meeting on Thursday, which could provide clues to future shifts in the central bank’s monetary policy.
  • The Bank of Japan held monetary policy stable, reaffirming its Y80 trillion in annual asset purchases and its yield curve strategy. Investors noted a market operation earlier this year that was seen as a potential signal of a slower pace of asset purchases, but the central bank commented that was not the case. Governor Haruhiko Kuroda will hold a press confernece later in the day to elaborate on the central bank's views. Overnight, the dollar recovered some of its losses against a basket of major currencies amid reports suggesting that the government secured enough support in the Senate to end the government shutdown. Other currencies, however, remained firm against the greenback, curbing its rebound from lows as sterling continued its trend higher. The euro eased from highs ahead of the European Central Bank meeting Thursday. Investor expectations for shift in the central bank's forward guidance to a more hawkish stance has eased in recent weeks. Action Economics said it doesn’t expect major changes to the guidance as ECB president Mario Draghi is unlikely to commit to an end date for quantitative easing.
  • Gold futures gained in Asia on Tuesday with a government shutdown in the US ended for at least three weeks after President Donald Trump signed a continuing funding resolution passed by Congress on Monday. Also weighing on gold prices was a continued rise in Treasury yields as the United States 10-Year rose to a nearly three-and-half-year high amid growing investor optimism on the outlook of inflation and economic growth. Sentiment for gold remains bullish, however, as data showed traders continued to increase their bullish bets on gold for the fifth week in a row. The most recent Commitment of Traders (CoT) report showed money managers increased their speculative gross long positions in Comex gold futures by 11,258 contracts to 227,373.
  • Oil prices rose on Tuesday, lifted by healthy economic growth as well as the ongoing supply restraint by a group of exporters around OPEC and Russia. Traders said oil markets were generally well supported by healthy economic growth. The International Monetary Fund (IMF) on Monday revised upward its forecast for world economic growth in 2018 and 2019, to 3.9 percent for both 2018 and 2019, a 0.2 percentage point increase from its last update in October This growth, which is also translating into more oil consumption, comes at a time of supply curbs by the OPEC and Russia, which began in January last year and are set to hold throughout 2018. But there have also been signs of a possible crude oil downward price correction Crumbling refinery profits, first in Asia and now also in Europe and the United States, as a result of rising feedstock prices and plentifully available fuel products, point to lower crude orders going forward. In the longer term, investors are preparing for large-scale changes in oil demand coming from the rise of electric vehicles.

 

 
Intraday RESISTANCE LEVELS
23rd January 2018 R1 R2 R3
GOLD-XAU 1,340 1,349 1,358-1366
Silver-XAG 17.45-17.70 18.08 18.60
Crude Oil 64.00 64.75 65.30-66.00
EURO/USD 1.2290-1.2360 1.2420 1.2500
GBP/USD 1.4000 1.4050 1.4130
USD/JPY 111.00-111.60 112.00 112.50-113.20

Intraday SUPPORTS LEVELS
23rd January 2018 S1 S2 S3
GOLD-XAU 1,330-1,320 1,309 1,300
Silver-XAG 17.00 16.70 16.35-15.80
Crude Oil 63.50-62.80 61.50 60.90
EURO/USD 1.2200 1.2160-1.2095 1.1990
GBP/USD 1.3950-1.3850 1.3750 1.3700-1.3650
USD/JPY 110.50 110.10 109.20-108.50

Intra-Day Strategy (23rd 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$1335.60/oz and low of US$1328.34/oz. Gold was down by 0.0179% at US$1333.81/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 1334-1375 keeping stop loss closing above 1375 and targeting 1326-1320 and 1309-1300. Buy above 1326-1300 with risk below 1300, targeting 1334-1340-1349 and 1357 1366.

 
Intraday Support Levels
S1     1,330-1,320
S2     1,309
S3     1,300
Intraday Resistance Levels
R1     1,340
R2     1,349
R3     1,358-1366

Technical Indicators

Name   Value Action
14DRSI  

67.384

Buy
20-DMA   1319.05 Sell
50-DMA  

1290.47

Sell
100-DMA   1292.13 Sell
200-DMA   1275.88 Buy
STOCH(5,3)   48.006 Buy
MACD(12,26,9)   14.295 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$17.08/oz and low of US$16.93/oz. Silver settled down by 0.293% at US$16.99/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   55.150 Buy
20-DMA   16.93 Sell
50-DMA   16.67 Sell
100-DMA   16.92 Sell
200-DMA   16.88 Sell
STOCH(5,3)   30.298 Sell
MACD(12,26,9)   0.148 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$64.12/bbl, intraday low of US$63.05/bbl and settled up by 0.724% to close at US$63.93/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 neutral region and giving positive crossover for confirmation of bullish 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 63.50-66.90 with stop loss at 67.00; targeting and 63.00-62.50 and 61.90-61.50-60.90. Buy above 63.00-60.90 with risk daily closing below 60.90 and targeting 63.50-64.20-64.75 and 65.30-66.00.

 
Intraday Support Levels
S1     63.50-62.80
S2     61.50
S3     60.90

Intraday Resistance Levels
R1     64.00
R2     64.75
R3     65.30-66.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.761 Sell
20-DMA   62.47 Buy
50-DMA   59.36 Buy
100-DMA   55.53 Buy
200-DMA   51.53 Buy
STOCH(5,3)   55.576 Buy
MACD(12,26,9)   1514 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.2213/EUR, high of US$1.2271/EUR and settled the day down by 0.0652% to close at US$1.2261/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 neutral 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   68.479 Buy
20-DMA   1.2081 Buy
50-DMA   1.1920 Sell
100-DMA   1.1857 Sell
200-DMA   1.1604 Buy
STOCH(5,3)   53.422 Sell
MACD(12,26,9)   0.0105 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3856/GBP, high of US$1.3989/GBP and settled the day up by 0.683% to close at US$1.3986/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.3431) 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 1.3950-1.4130 with targets at 1.3850-1.3750 and 1.3700-1.3650. Buy above 1.3850-1.3650 with stop loss closing below 1.3650 targeting 1.3950-1.4000 and 1.4050-1.4130.

 
Intraday Support Levels
S1     1.3950-1.3850
S2     1.3750
S3     1.3700-1.3650

Intraday Resistance Levels
R1     1.4000
R2     1.4050
R3     1.4130

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

77.251

Buy
20-DMA   1.3646 Sell
50-DMA   1.3463 Sell
100-DMA   1.3353 Buy
200-DMA   1.3132 Buy
STOCH(5,3)   85.68 Buy
MACD(12,26,9)   0.0143 Buy

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.49/USD and made an intraday high of JPY111.22/USD and settled the day down by 0.325% at JPY110.91/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (111.69), 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
S3     109.20-108.50

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.730 Buy
20-DMA   111.89 Sell
50-DMA   112.29 Sell
100-DMA   112.26 Sell
200-DMA   111.71 Sell
STOCH(9,6)   47.023 Sell
MACD(12,26,9)   -0.536 Sell

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