AAFX TRADING

Daily Market Lookup

  • Asian stocks retreated from record highs on Tuesday after a selloff in Apple shares and spike in bond yields knocked Wall Street lower, while the dollar found support as U.S. bond yields climbed to near four-year highs. The bearish sentiment in Asia followed a softer lead from Wall Street, which has led a global equities rally over the past year thanks to strong world growth fuelling higher corporate earnings and stock valuations. The dollar, however, enjoyed a reprieve from some persistent selling in the past few weeks. The 10-year Treasury note yield stretched its overnight surge above 2.70% and reached its highest since April 2014 after comments from a European Central Bank official added to expectations that central banks globally will reduce stimulus as the economic outlook improves. The U.S. Treasury Department said on Monday that it expects to borrow $441 bn through the credit markets in the January-March quarter, less than announced previously. Moreover, the bond market braced for potentially hawkish language from the Federal Reserve, which will begin its two-day policy meeting on Tuesday. The focus was also on U.S. President Donald Trump’s State of the Union address scheduled later in the global day, with attention on his views on an infrastructure overhaul and trade.
  • The dollar held above a recent three-year low against a basket of major currencies on Tuesday, with traders turning their attention to U.S. President Donald Trump's State of the Union speech and a Federal Reserve policy meeting for catalysts. Market participants are probably waiting for Trump's State of the Union speech, due later on Tuesday, for anything further he might have to say about the dollar, Ino said. Treasury Secretary Steven Mnuchin gave U.S. currency bears a major boost last week with a tacit endorsement of a weak dollar. Trump later tried to row back from those comments, saying he ultimately wants the dollar to be strong. Trump said on Monday he will address his proposed immigration overhaul in his State of the Union speech as well as his efforts to lower trade barriers around the world for American exports. The president will also outline his much-anticipated infrastructure plan in the speech. The low-yielding yen is a popular funding currency for investments in higher-yielding assets, and therefore tends to benefit when investors trim their risk exposure. The yen has risen in recent weeks, after the Bank of Japan reduced its buying of long-dated government bonds in market operations earlier this month, sparking speculation of an eventual exit from its large stimulus. The next BOJ governor should maintain the central bank's ultra-accommodative stimulus, a key part of the "Abenomics" policy mix, an economic adviser to Prime Minister Shinzo Abe said in an interview published on Tuesday. Koichi Hamada, an emeritus professor of economics at Yale University, added that the yen could firm in the short-term due to speculation about U.S. currency policy. Hamada also praised BOJ Governor Haruhiko Kuroda, who is widely expected to be asked to stay on after his five-year term ends in April, but said there were other well-qualified individuals who could take up the reins.
  • Gold prices slipped in Asia on Tuesday as the dollar edged up ahead of the start of a two-day FOMC meeting with rates seen steady, but views on inflation expected to have an impact on the market. Overnight, gold prices fell on Monday in the wake of a sharp move higher in the dollar amid investor expectations that solid economy growth and faster inflation would strengthen the Federal Reserve’s case for a more aggressive approach to monetary policy. Goldman Sachs (NYSE:GS) said it expects the Federal Reserve bank to adopt a slightly hawkish slant in its commentary related to economic conditions and inflation, when the central bank releases its policy statement due Wednesday That stoked investor expectations for a more hawkish outlook on US rates, sending yields soaring while boosting the greenback, pressuring gold to session lows. Markets have priced in three rate hikes this year, the first of which is widely expected in March.
  • Oil prices fell on Tuesday for a second day as rising U.S. output and a strengthening dollar sapped demand for crude, pushing Brent below $70 a barrel. Prices are still heading for a fifth straight monthly gain. U.S. production is already on par with Saudi Arabia, the biggest producer in the OPEC. Only Russia produces more, averaging 10.98 mn bpd in 2017. U.S. output has jumped more than 17 percent since mid-2016 and is expected to exceed 10 mn bpd soon. Drillers in the U.S. added 12 oil rigs for new production in the week to Jan. 26, Baker Hughes reported on Friday. The recent rally in oil prices had been fueled by the U.S. dollar's six straight weekly slides. The greenback is down 3 percent so far this month. Investors are bracing "for the upcoming refinery maintenance season amid a strong USD," ANZ Research said in a note, which also pointed to rising inventories as U.S. shale producers continue their battle with OPEC. Crude prices may also be under pressure on expectations for U.S. inventories to rise for the first time in 11 weeks, according to a preliminary poll by Reuters on Monday.

 

 
Intraday RESISTANCE LEVELS
30th January 2018 R1 R2 R3
GOLD-XAU 1,342-1,350 1,358 1,366-1,375
Silver-XAG 17.70-18.20 18.60 18.95
Crude Oil 65.30 66.00 66.90-68.00
EURO/USD 1.2400 1.2500 1.2590-1.2650
GBP/USD 1.4100-1.4200 1.4260 1.4300-1.4390
USD/JPY 109.20-110.10 110.50 111.00-111.60

Intraday SUPPORTS LEVELS
30th January 2018 S1 S2 S3
GOLD-XAU 1,331 1,326-1,320 1,311
Silver-XAG 17.00 16.70 17.70-18.20
Crude Oil 64.00 63.50-62.80 61.90
EURO/USD 1.2360 1.2290 1.2200-1.2160
GBP/USD 1.4050-1.4000 1.3860 1.3800
USD/JPY 108.45-107.90 107.30 106.50

Intra-Day Strategy (30th January 2018)
GOLD-XAU Sell on Strength
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$1352.30/oz and low of US$1337.51/oz. Gold was down by 0.623% at US$1340.27/oz.

Technicals in Focus:

In daily charts, prices are below 20DMA (1329) 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 negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Sell on Strength

Based on the charts and explanations above; sell below 1355-1375 keeping stop loss closing above 1375 and targeting 1342-1336 and 1326-1318. Buy above 1358-1326 with risk below 1326, targeting 1355-1366-1375 and 1382-1390.

 
Intraday Support Levels
S1     1,331
S2     1,326-1,320
S3     1,311
Intraday Resistance Levels
R1     1,342-1,350
R2     1,358
R3     1,366-1,375

Technical Indicators

Name   Value Action
14DRSI  

57.959

Buy
20-DMA   1331.72 Buy
50-DMA  

1297.06

Buy
100-DMA   1292.49 Buy
200-DMA   1277.26 Buy
STOCH(5,3)   54.395 Sell
MACD(12,26,9)   15.950 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$17.46/oz and low of US$17.09/oz. Silver settled down by 1.49% at US$17.14/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 17.00-15.80 targeting 17.75-18.20 and 18.60-18.95; stop breakage below 15.80. Sell below 17.70-18.60 with stop loss above 18.60; targeting 17.45-17.00-16.70 and 16.35-15.80.

 
Intraday  Support Levels
S1     17.00
S2     16.70
S3     17.70-18.20

Intraday  Resistance Levels
R1     17.70-18.20
R2     18.60
R3     18.95

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.675 Buy
20-DMA   17.13 Sell
50-DMA   16.70 Sell
100-DMA   16.87 Sell
200-DMA   16.84 Sell
STOCH(5,3)   45.440 Buy
MACD(12,26,9)   0.143 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$66.46/bbl, intraday low of US$64.96/bbl and settled down by 0.997% to close at US$65.51/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 65.30-68.00 with stop loss at 68.00; targeting and 64.00-63.50 and 62.80-61.90. Buy above 64.00-61.90 with risk daily closing below 61.90 and targeting 65.30-66.00-66.90 and 68.00-68.80.

 
Intraday Support Levels
S1     64.00
S2     63.50-62.80
S3     61.90

Intraday Resistance Levels
R1     65.30
R2     66.00
R3     66.90-68.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.533 Sell
20-DMA   63.89 Buy
50-DMA   60.33 Buy
100-DMA   56.39 Buy
200-DMA   51.88 Buy
STOCH(5,3)   61.754 Buy
MACD(12,26,9)   1.558 Buy

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.2336/EUR, high of US$1.2431/EUR and settled the day down by 0.338% to close at US$1.2381/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 1.2400-1.2725 targeting 1.2360-1.2290 and 1.2200-1.2160 with stop-loss at daily closing above 1.2725. Buy above 1.2360-1.2160 with risk below 1.2150 targeting 1.2400-1.2500-1.2590 and 1.2650-1.2725.

 
Intraday Support Levels
S1     1.2360
S2     1.2290
S3     1.2200-1.2160

Intraday  Resistance Levels
R1     1.2400
R2     1.2500
R3     1.2590-1.2650

TECHNICAL INDICATORS
Name   Value Action
14DRSI   67.452 Buy
20-DMA   1.2193 Buy
50-DMA   1.1983 Buy
100-DMA   1.1879 Buy
200-DMA   1.1647 Buy
STOCH(5,3)   50.220 Sell
MACD(12,26,9)   0.0126 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.4024/GBP, high of US$1.4157/GBP and settled the day down by 0.466% to close at US$1.4072/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 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 1.4100-1.4400 with targets at 1.4050-1.4000 and 1.3860-1.3800. Buy above 1.4050-1.3800 with stop loss closing below 1.3800 targeting 1.4100-1.4200 and 1.4260-1.4300-1.4390.

 
Intraday Support Levels
S1     1.4050-1.4000
S2     1.3860
S3     1.3800

Intraday Resistance Levels
R1     1.4100-1.4200
R2     1.4260
R3     1.4300-1.4390

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

64.921

Buy
20-DMA   1.3814 Sell
50-DMA   1.3559 Sell
100-DMA   1.3407 Buy
200-DMA   1.3166 Buy
STOCH(5,3)   39.404 Sell
MACD(12,26,9)   0.0175 Buy

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY108.50/USD and made an intraday high of JPY109.20/USD and settled the day down by 0.230% at JPY108.94/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 109.20-111.60 with risk above 111.60 targeting 108.45-107.90 and 107.30-106.50. Long positions above 108.45-106.50 with targets of 109.20-110.10-110.50 and 111.00-111.60 with stop below 107.30.

 
Intraday Support Levels
S1     108.45-107.90
S2     107.30
S3     106.50

INTRADAY RESISTANCE LEVELS
R1     109.20-110.10
R2     110.50
R3     111.00-111.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   29.278 Buy
20-DMA   111.06 Sell
50-DMA   111.94 Sell
100-DMA   112.25 Sell
200-DMA   111.71 Sell
STOCH(9,6)   20.252 Buy
MACD(12,26,9)   -0.923 Sell

AAFX TRADING
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