AAFX TRADING

Daily Market Lookup

  • Asian shares were hammered again on Monday as fears of a trade war between the United States and China took their toll, but the safe haven yen came off its highs and U.S. stock futures climbed as investors saw some light at the end of the tunnel. Global markets were shaken when U.S. President Donald Trump moved to slap tariffs on Chinese goods, on top of import duties on steel and aluminum, prompting a defiant response from Beijing. But E-Mini futures for the S&P 500 .ESc1 brushed off the gloom on Monday to leap 0.6 percent on reports the United States and China have quietly started negotiating to improve U.S. access to Chinese markets. The United States also agreed to exempt South Korea from steel tariffs, imposing instead a quota on steel imports as the two countries renegotiate their trade deal. The positive headlines were little consolation for Asian shares which were left nursing their wounds. The index is headed for its first quarterly decline since late 2016 as the risk of faster U.S. rate rises and a trade war spooked investors who had enjoyed a multi-year bull run. In the uncertain global economic climate, investors looked to pile into the Japanese yen JPY=, traditionally a safe haven asset thanks to the country's massive current account surplus. Speculators added short dollar bets to their portfolios, taking the net short position to its highest in more than a year, according to calculations by Reuters and the Commodity Futures Trading Commission for the week to March 20.Short yen positions were cut to the smallest since November 2016.
  • The dollar slipped to a 16-month low against the yen on Monday, pressured by lingering fears of a global trade war and a political crisis that has engulfed Japanese Prime Minister Shinzo Abe. The dollar had already slumped 1.2 percent versus its Japanese peer last week as escalating trade tensions between the United States and China stoked concerns about global growth. Global markets were shaken after U.S. President Donald Trump moved to impose tariffs on Chinese goods, edging the world's two largest economies closer to a trade war. Economic measures dubbed "Abenomics" initiated by Abe has been a factor that has pulled the yen down over the past few years to the benefit of exporters. Any event that leads to a decline in the premier's support ratings is seen weakening his ability to keep Abenomics in place. According to calculations by Reuters and Commodity Futures Trading Commission data released on Friday, speculators' net short positioning on the yen shrank rapidly to roughly 22,000 contracts in the latest week, the smallest since November 2016, from a net short position of about 79,500 contracts. During past episodes of turmoil such as the European debt crisis in 2016, participants had more reason to actively buy the Japanese currency but the situation has changed this time around with the U.S. economy stronger and their yields higher, Fukaya said. The Swiss franc was little changed at 0.9468 franc per dollar after gaining 0.55 percent against the greenback last week.
  • Oil prices edged down on Monday morning in Asia, after a significant spike caused by tension in the Middle East. The launch of China’s yuan-denominated oil futures has also caused a stir in oil markets. Rising geopolitical risk in the Middle East has driven oil prices up. President Donald Trump continues to suggest the U.S. will pull out from the Iran nuclear deal, which raises concerns that sanctions will be reimposed on the country and severely limit Tehran’s ability to export crude oil. These concerns escalated just over a week ago when Saudi Arabia’s Prince Mohammed bin Salman ramped up tough rhetoric over Iran, pledging to acquire nuclear weapons if Iran develops them. His recent talks with President Trump in Washington, pledging to buy more U.S. military equipment, also show that Saudi foreign policy is becoming more aggressive Meanwhile, the launch of Shanghai crude oil futures potentially marks the dawn of a new oil price benchmark to rival dominant Brent and West Texas Intermediate (WTI). Around 12 million barrels of Shanghai’s most-active September contract changed hands in the first 55 minutes of trade, more than the most-active contract for Brent. The launch of China’s yuan-denominated oil futures is expected to give the world’s largest energy consumer more power in pricing crude sold to Asia. Further supporting oil markets is Saudi Arabia’s push for production curbs led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia to be extended into 2019, in an effort to prop up oil prices.

 

 
Intraday RESISTANCE LEVELS
26th March 2018 R1 R2 R3
GOLD-XAU 1,350-1,357 1,363 1,370
Silver-XAG 17.00 17.40 17.70-18.20
Crude Oil 66.00 66.60-67.00 68.00
EURO/USD 1.2400 1.2450 1.2510-1.2560
GBP/USD 1.4200-1.4250 1.4300 1.4350
USD/JPY 105.50 106.00-106.70 107.50

Intraday SUPPORTS LEVELS
26th March 2018 S1 S2 S3
GOLD-XAU 1,340-1,331 1,320 1,313-1,306
Silver-XAG 16.50 16.00-15.80 15.60
Crude Oil 63.10-62.70 64.20 63.10-62.70
EURO/USD 1.2350-1.2300 1.2210 1.2160-1.2100
GBP/USD 1.4120-1.4070 1.4000 1.3900-1.3855
USD/JPY 104.90-104.40 103.90 103.10

Intra-Day Strategy (26th 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 Friday made its intraday high of US$1350.13/oz and low of US$1328.85/oz. Gold was up by 1.362% at US$1347.10/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 positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Sell on Strength

Based on the charts and explanations above; sell below 1350-1370 keeping stop loss closing above 1370 and targeting 1340-1331-1320 and 1314-1306. Buy above 1340-1306 with risk below 1306, targeting 1350-1357-1362-1370

 
Intraday Support Levels
S1     1,340-1,331
S2     1,320
S3     1,313-1,306
Intraday Resistance Levels
R1     1,350-1,357
R2     1,363
R3     1,370

Technical Indicators

Name   Value Action
14DRSI  

61.365

Buy
20-DMA   1323.42 Sell
50-DMA  

1330.96

Buy
100-DMA   1306.83 Buy
200-DMA   1291.23 Buy
STOCH(5,3)   85.0494 Buy
MACD(12,26,9)   0.153 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$16.65/oz and low of US$16.36/oz. Silver settled up by 1.161% at US$16.55/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 16.50-15.00 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     16.50
S2     16.00-15.80
S3     15.60

Intraday  Resistance Levels
R1     17.00
R2     17.40
R3     17.70-18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.704 Buy
20-DMA   16.46 Sell
50-DMA   16.69 Sell
100-DMA   16.68 Sell
200-DMA   16.76 Sell
STOCH(5,3)   71.886 Buy
MACD(12,26,9)   -0.0630 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$65.92/bbl, intraday low of US$64.05/bbl and settled up by 2.39% to close at US$65.73/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 overbought 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 65.50-68.00 with stop loss at 68.00; targeting 64.70-64.20-63.10 and 62.70-62.00-61.00. Buy above 64.70-62.00 with risk daily closing below 62.00 and targeting 65.50-66.60 and 67.00-68.00.

 
Intraday Support Levels
S1     63.10-62.70
S2     64.20
S3     63.10-62.70

Intraday Resistance Levels
R1     66.00
R2     66.60-67.00
R3     68.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.071 Sell
20-DMA   62.39 Sell
50-DMA   62.72 Sell
100-DMA   60.60 Buy
200-DMA   54.67 Buy
STOCH(5,3)   79.657 Sell
MACD(12,26,9)   0.571 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.2305/EUR, high of US$1.2373/EUR and settled the day up by 0.373% to close at US$1.2351/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 1.2400-1.2600 targeting 1.2350-1.2300-1.2210 and 1.2160-1.2100 with stop-loss at daily closing above 1.2600. Buy above 1.2210-1.2050 with risk below 1.2050 targeting 1.2300-1.2350-1.2450 and 1.2510-1.2570.

 
Intraday Support Levels
S1     1.2350-1.2300
S2     1.2210
S3     1.2160-1.2100

Intraday  Resistance Levels
R1     1.2400
R2     1.2450
R3     1.2510-1.2560

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.847 Buy
20-DMA   1.2319 Buy
50-DMA   1.2334 Buy
100-DMA   1.2089 Buy
200-DMA   1.1892 Buy
STOCH(5,3)   68.974 Buy
MACD(12,26,9)   0.00076 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.4084/GBP, high of US$1.4171/GBP and settled the day up by 0.219% to close at US$1.4084/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 1.4150-1.4300 with targets at 1.4070-1.4010 and 1.3900-1.3855. Buy above 1.4070-1.3855 with stop loss closing below 1.3855 targeting 1.4070-1.4150 and 1.4250-1.4300.

 
Intraday Support Levels
S1     1.4120-1.4070
S2     1.4000
S3     1.3900-1.3855

Intraday Resistance Levels
R1     1.4200-1.4250
R2     1.4300
R3     1.4350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

64.431

Buy
20-DMA   1.3938 Sell
50-DMA   1.3971 Buy
100-DMA   1.3672 Buy
200-DMA   1.3375 Buy
STOCH(5,3)   68.767 Sell
MACD(12,26,9)   0.0057 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY104.63/USD and made an intraday high of JPY105.32/USD and settled the day down by 0.541% at JPY104.73/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 positive crossover to confirm bullish stance.

Trading Strategy: Neutral to Sell

Sell below 105.50-108.00 with risk above 108.00 targeting 104.90-104.40 and 103.90-103.10. Long positions above 104.90-103.10 with targets of 105.50-106.00-106.70 and 107.50-107.90 with stop below 104.90.

 
Intraday Support Levels
S1     104.90-104.40
S2     103.90
S3     103.10

INTRADAY RESISTANCE LEVELS
R1     105.50
R2     106.00-106.70
R3     107.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   34.172 Buy
20-DMA   106.12 Sell
50-DMA   107.68 Sell
100-DMA   110.16 Sell
200-DMA   110.84 Sell
STOCH(9,6)   9.667 Sell
MACD(12,26,9)   -0.666 Sell

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