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Daily Market Lookup

  • Asian share regained some ground on Tuesday after U.S. President Donald Trump faced growing pressure from political allies to pull back from proposed steel and aluminum tariffs, easing investor worries about an imminent trade war. Sentiment was also supported by receding risk aversion in Europe with the euro gaining support from the creation of a coalition government in Germany and the impact of Italy’s inconclusive election results limited to a mild sell-off in domestic bonds and stocks. Korean shares have erased all the losses they had taken after Trump’s announcement even though the country is seen as being among the worst affected in region by the tariffs due to its big steel exports to the United States. Wall Street shares have now recouped all the losses incurred after Trump unveiled a plan to impose tariffs on steel and aluminum late on Thursday. Leading Republicans, including House of Representatives Speaker Paul Ryan and Representative Kevin Brady, turned up the pressure on Trump to rethink the plan on Monday. Still, uncertainty remains with confusion about the timing and extent of the planned tariffs inside the White House. Trump said on Monday he would not back down, without elaborating. Trump was expected to finalize the planned tariffs later in the week, although some observers familiar with the process said it could occur next week. The specter of a trade war was not the only source of concern for the stock market. As the global economy steams ahead, investors have become increasingly concerned that U.S. inflation, which has been subdued since the 2008 financial crisis, could finally pick up. While moderate inflation generally supports equity investors, rapid inflation, or fear of it, could prompt the Federal Reserve to hike rates faster, undermining the attraction of equities. The euro managed to recover losses made on Monday after two anti-establishment leaders made early plays to govern Italy following an inconclusive election where voters shunted mainstream parties to the sidelines. As none of the three main factions had enough seats to govern alone, President Sergio Mattarella is expected to open formal coalition talks in April, with early elections possible if no accord is found.
  • The dollar held steady versus the yen on Tuesday, supported by receding fears about a trade war stemming from U.S. President Donald Trump's proposed tariffs on imported steel and aluminum. The dollar had tumbled to 16-month lows against the safe-haven yen late last week as concerns about a trade war gripped markets after Trump announced his plan for steel and aluminum tariffs. Jitters have eased this week, however, as pressure to back off from plans to implement new tariffs grew and as market participants came to view Trump's proposed tariffs more as a negotiating tactic than a hard policy proposal. The yen showed limited reaction after Bank of Japan Governor Haruhiko Kuroda said on Tuesday there were downside risks to the central bank's projection that inflation would reach its 2% target around the fiscal year ending in March 2020. Speculation regarding when the BOJ, which has significantly lagged its peers in moving toward policy normalization, would explore an exit from its easy policy has been one of the key themes impacting the yen in the past few months. The yen had risen last week after Kuroda on Friday flagged for the first time the prospect of an exit from accommodative policy if his inflation target was met. Investors are now waiting for further news regarding the tariffs proposed by Trump, said Heng Koon How, head of markets strategy for United Overseas Bank in Singapore. Two anti-establishment leaders made early plays to govern Italy on Monday, following an inconclusive election where voters shunted mainstream parties to the sidelines. The negative impact on markets from Italy's election results, was somewhat offset by Germany's Social Democrats agreeing to join Chancellor Angela Merkel's conservatives, ending a period of uncertainty in Europe's biggest economy.
  • Oil futures rose on Tuesday for a third session, underpinned by robust demand forecasts and as ministers from OPEC touted the strength of its agreement to cut output to bolster prices. The IEA said on Monday that global oil demand was expected to grow over the next five years, while output from producers in the OPEC would rise at a much slower pace. The IEA's comments on increased demand, made during the CERA Week conference in Houston on Monday, preceded statements from OPEC Secretary General Mohammed Barkindo that called the supply cut agreement with global producers "as solid as the Rock of Gibraltar". To fill the gap between OPEC and global demand, the IEA said the United States would supply much of the oil demand as its shale oil production was set to surge. U.S. crude production has risen to more than 10 million bpd, overtaking top exporter Saudi Arabia. Output hit a record 10.057 mn bpd in November, according to the U.S. Department of Energy. Meanwhile, Michael McCarthy, chief market strategist at CMC Markets, said traders were waiting for U.S. crude inventories data. U.S. crude inventories were expected to rise by 3 million barrels in the week to March 2, marking a second straight week increase, according to a Reuter’s poll. Industry group API is set to release its inventory data at 4:30 p.m. EST (2130 GMT) on Tuesday, and the U.S. Energy Department's EIA is scheduled to report its data at 10:30 a.m. EST (1530 GMT) on Wednesday.

 

 
Intraday RESISTANCE LEVELS
6th March 2018 R1 R2 R3
GOLD-XAU 1,331 1,340 1,350-1,358
Silver-XAG 17.40-17.70 17.40-17.70 18.20
Crude Oil 62.80-63.40 64.00 64.70
EURO/USD 1.2390-1.2450 1.2520 1.2560
GBP/USD 1.3855-1.3900 1.3950 1.4070
USD/JPY 106.70 107.50 108.45-109.00

Intraday SUPPORTS LEVELS
6th March 2018 S1 S2 S3
GOLD-XAU 1324 1,313-1,306 1,300
Silver-XAG 16.20-15.90 15.60 15.00
Crude Oil 62.20-61.50 61.00 60.50-59.90
EURO/USD 1.2300 1.2210-1.2160 1.2090
GBP/USD 1.3800 1.3765 1.3700-1.3620
USD/JPY 106.00 105.50-104.90 104.50

Intra-Day Strategy (6th March 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$1327.67/oz and low of US$1317.45/oz. Gold was down by 0.264% at US$1320.21/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 oversold 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 1331-1350 keeping stop loss closing above 1350 and targeting 1324-1314-1306 and 1300-1287. Buy above 1320-1310 with risk below 1310, targeting 1331-1340 and 1350-1358-1366.

 
Intraday Support Levels
S1     1324
S2     1,313-1,306
S3     1,300
Intraday Resistance Levels
R1     1,331
R2     1,340
R3     1,350-1,358

Technical Indicators

Name   Value Action
14DRSI  

43.604

Buy
20-DMA   1331.54 Sell
50-DMA  

1323.31

Buy
100-DMA   1299.89 Buy
200-DMA   1286.59 Buy
STOCH(5,3)   26.071 Buy
MACD(12,26,9)   -0.197 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$16.58/oz and low of US$16.34/oz. Silver settled down by 0.545% at US$16.41/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (16.82), breakage above will lead to 17.25-17.70. 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 positive crossover to show upside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 16.00-15.00 targeting 17.00-17.75 and 18.20-18.60; stop breakage below 15.00. Sell below 17.00-18.20 with stop loss above 18.20; targeting 16.20-15.60 and 15.00-14.50.

 
Intraday  Support Levels
S1     16.20-15.90
S2     15.60
S3     15.00

Intraday  Resistance Levels
R1     17.40-17.70
R2     17.40-17.70
R3     18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.525 Buy
20-DMA   16.52 Sell
50-DMA   16.83 Sell
100-DMA   16.75 Sell
200-DMA   16.81 Sell
STOCH(5,3)   59.090 Buy
MACD(12,26,9)   -0.1009 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$62.45/bbl, intraday low of US$61.00/bbl and settled up by 1.677% to close at US$62.44/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 61.15 which is a major resistance and breakage above will call for 62.20-62.80. 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 62.80-64.70 with stop loss at 64.70; targeting 62.20-61.50-61.00 and 60.50-59.90. Buy above 62.00-59.00 with risk daily closing below 59.00 and targeting 62.80-63.40 and 64.00-64.70.

 
Intraday Support Levels
S1     62.20-61.50
S2     61.00
S3     60.50-59.90

Intraday Resistance Levels
R1     62.80-63.40
R2     64.00
R3     64.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.506 Sell
20-DMA   61.42 Sell
50-DMA   62.51 Sell
100-DMA   59.26 Sell
200-DMA   53.59 Buy
STOCH(5,3)   54.793 Buy
MACD(12,26,9)   -0.0144 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.2363/EUR, high of US$1.2363/EUR and settled the day up by 0.08% to close at US$1.2335/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 1.2350-1.2560 targeting 1.2300-1.2210-1.2160 and 1.2090-1.2005 with stop-loss at daily closing above 1.2600. Buy above 1.2300-1.2090 with risk below 1.2090 targeting 1.2390-1.2450-1.2520 and 1.2571-1.2600.

 
Intraday Support Levels
S1     1.2300
S2     1.2210-1.2160
S3     1.2090

Intraday  Resistance Levels
R1     1.2390-1.2450
R2     1.2520
R3     1.2560

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.427 Buy
20-DMA   1.2320 Buy
50-DMA   1.2244 Buy
100-DMA   1.2004 Buy
200-DMA   1.1814 Buy
STOCH(5,3)   87.393 Buy
MACD(12,26,9)   0.0010 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3765/GBP, high of US$1.3876/GBP and settled the day up by 0.391% to close at US$1.3847/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 neutral 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 1.3855-1.4070 with targets at 1.3800-1.3765 and 1.3700-1.3620- 1.3550. Buy above 1.3800-1.3620 with stop loss closing below 1.3620 targeting 1.3855-1.3900 and 1.3950-1.4050.

 
Intraday Support Levels
S1     1.3800
S2     1.3765
S3     1.3700-1.3620

Intraday Resistance Levels
R1     1.3855-1.3900
R2     1.3950
R3     1.4070

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

46.834

Buy
20-DMA   1.3908 Sell
50-DMA   1.3846 Buy
100-DMA   1.3295 Buy
200-DMA   1.3295 Buy
STOCH(5,3)   42.906 Buy
MACD(12,26,9)   -0.0015 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY105.34/USD and made an intraday high of JPY106.23/USD and settled the day down by 0.701% at JPY106.18/USD.

Technicals in Focus:

In daily charts, JPY is sustaining below 200DMA (111.15), which is major resistance 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 106.70-109.00 with risk above 109.00 targeting 106.00-105.50 and 104.90-104.20. Long positions above 106.00-104.50 with targets of 106.70-107.50-107.90 and 108.45-109.00 with stop below 104.90.

 
Intraday Support Levels
S1     106.00
S2     105.50-104.90
S3     104.50

INTRADAY RESISTANCE LEVELS
R1     106.70
R2     107.50
R3     108.45-109.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   36.607 Buy
20-DMA   107.15 Sell
50-DMA   109.45 Sell
100-DMA   111.19 Sell
200-DMA   111.15 Sell
STOCH(9,6)   33.492 Sell
MACD(12,26,9)   -0.919 Sell

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