AAFX TRADING

Daily Market Lookup

  • Asian shares fell on Wednesday after Wall Street was knocked hard by concerns about tighter controls on the tech industry, denting a brief global equities recovery driven by hopes that the risk of a U.S.-China trade war was easing. They extended losses further after China's state-run Global Times reported China will soon announce a list of retaliatory tariffs on United States exports to China. Investors rotated out of the tech sector, which had long outperformed the market on hopes of new technologies such as AI and internet of things The report that Beijing plans to announce retaliatory tariffs against the U.S. President Donald Trump's plans for tariffs on up to $60 billion of Chinese goods rekindled worries about a Sino-U.S. trade war. While the market remains highly vulnerable to news headline like this, recent reports of behind-the-scenes talks between Washington and Beijing spurred some optimism. The euro lost steam after soft euro zone economic data and comments from European Central Bank policymakers flagging low underlying inflation. Economic sentiment in the 19-countries sharing the euro slipped for the third month in a row in March while bank lending slowed. Erkki Liikanen, an ECB Governing Council member, said that underlying inflation in the euro zone may remain lower than expected even if growth is robust, so the central bank needs to remain patient in removing stimulus. Another member, Jozef Makuch from Slovakia, also struck a similarly cautious tone.
  • Gold prices edged higher on Wednesday as the dollar weakened despite signs of an improving geopolitical situation with North Korea. China confirmed that North Korean leader Kim Jong Un met with president Xi Jinping, local media Xinhua reported Wednesday, adding that Kim said he would be willing to give up nuclear weapons and hold a summit with the U.S. Kim is due to have a summit with his South Korean counterpart in April and U.S. President Trump by the end of May, according to reports earlier this year. Dollar-denominated assets such as gold are sensitive to moves in the dollar – a fall in the dollar makes gold cheaper for holders of foreign currency and thus increases demand for the precious metal. The yellow metal recorded its biggest one-day fall in nearly two weeks on Tuesday.
  • The dollar recovered slowly in Asia on Wednesday morning as the safe-haven yen retreated against the greenback on risk-on sentiment that gave other Asian currencies a lift. Over in Asia, the developments in the Korean peninsula and attempts to end the political scandal in Japan were risk-on developments that prompted investors to bet on risk assets. The tariffs imposed by the U.S. government on China sparked global fears of a trade war and hampered the dollar, but the dollar recovered amid hopes that the U.S. and China would begin negotiations. Investors also await the U.S. GDP growth data of the fourth quarter due on Thursday. During his first known trip outside of the country, Kim said he was willing to give up nuclear weapons and hold a summit with the U.S., signaling the easing geopolitical tensions in East Asia. Reports said Japan’s Prime Minister Shinzo Abe is preparing for a meeting with the U.S. President Donald Trump in April to hold talks and develop a strategy ahead of a proposed meeting between North Korean and US leaders. Reports that confirmed North Korean leader Kim Jong-un met with Chinese President Xi Jinping caught some attention. Xi said China will be working with North Korea to “make new contribution to regional peace, stability and development.”
  • Oil prices fell on Wednesday, with Brent dropping back below $70 per barrel and U.S. West Texas Intermediate crudes dipping below $65, pulled down by a report of increasing U.S. crude inventories that surprised many traders. Traders said the falls came after the API late on Tuesday reported a surprise 5.3 mn bbl rise in crude sticks in the week to March 23, to 430.6 mb barrels. Official U.S. inventory data will be published by the EIA late on Wednesday. Robert Carnell, chief economist and head of research at Dutch bank ING in Asia told the Reuters Global Markets Forum on Wednesday that "more supply coming from the U.S." would also likely weigh on oil prices. U.S. oil production has already jumped by almost a quarter since mid-2016, to 10.4 million bpd, taking it past top exporter Saudi Arabia and within reach of the biggest producer, Russia, which pumps around 11 million bpd. Wednesday's price falls came despite Saudi Arabia saying it was working with Russia on a historic long-term pact that could extend controls over world crude supplies by major exporters for many years. Saudi Crown Prince Mohammed bin Salman told Reuters that Riyadh and Moscow were considering greatly extending a short-term alliance on oil curbs that began in January 2017 after a crash in crude prices, with a partnership to manage supplies potentially growing "to a 10-to-20-year agreement." Since Shanghai crude oil futures were launched on March 26, it would have been profitable to buy the spread between Brent and Shanghai crudes, which has risen from $1.6 per barrel on Monday to $4.6 on Wednesday, while shorting the Shanghai premium over WTI, which has narrowed from $3.1 a barrel on Monday to just 30 cents on Wednesday.

 

 
Intraday RESISTANCE LEVELS
28th March 2018 R1 R2 R3
GOLD-XAU 1,350-1,357 1,363 1,370-1,375
Silver-XAG 17.00 17.40 17.70-18.20
Crude Oil 65.20 66.00 66.60-67.00
EURO/USD 1.2400 1.2450 1.2510-1.2560
GBP/USD 1.4250-1.4300 1.4350 1.4500
USD/JPY 106.00-106.70 107.50 108.70

Intraday SUPPORTS LEVELS
28th March 2018 S1 S2 S3
GOLD-XAU 1,340-1,331 1,320 1,311
Silver-XAG 16.50 16.00-15.8016.00-15.80 15.60
Crude Oil 64.70-64.20 63.10 62.40
EURO/USD 1.2350-1.2300 1.2210 1.2150
GBP/USD 1.4150 1.4000 1.4000
USD/JPY 105.50-104.90 104.40 106.00-106.70

Intra-Day Strategy (28th 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 Tuesday made its intraday high of US$1356.73/oz and low of US$1356.73/oz. Gold was down by 0.656% at US$1344.53/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 1350-1375 keeping stop loss closing above 1375 and targeting 1340-1331 and 1320-1314. Buy above 1340-1310 with risk below 1310, targeting 1350-1357-1362 and 1370-1375.

 
Intraday Support Levels
S1     1,340-1,331
S2     1,320
S3     1,311
Intraday Resistance Levels
R1     1,350-1,357
R2     1,363
R3     1,370-1,375

Technical Indicators

Name   Value Action
14DRSI  

63.848

Buy
20-DMA   1331.77 Sell
50-DMA  

1331.62

Buy
100-DMA   1308.49 Buy
200-DMA   1291.25 Buy
STOCH(5,3)   77.422 Sell
MACD(12,26,9)   4.226 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$16.46/oz and low of US$16.78/oz. Silver settled down by 0.959% at US$16.51/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 overbought 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     16.00-15.8016.00-15.80
S3     15.60

Intraday  Resistance Levels
R1     17.00
R2     17.40
R3     17.70-18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.671 Buy
20-DMA   16.47 Sell
50-DMA   16.67 Sell
100-DMA   16.68 Sell
200-DMA   16.76 Sell
STOCH(5,3)   74.517 Buy
MACD(12,26,9)   -0.0336 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$66.34/bbl, intraday low of US$64.50/bbl and settled down by 1.253% to close at US$64.61/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     64.70-64.20
S2     63.10
S3     62.40

Intraday Resistance Levels
R1     65.20
R2     66.00
R3     66.60-67.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.276 Sell
20-DMA   62.64 Sell
50-DMA   62.75 Sell
100-DMA   60.76 Buy
200-DMA   54.87 Buy
STOCH(5,3)   51.174 Sell
MACD(12,26,9)   0.814 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.2371/EUR, high of US$1.2475/EUR and settled the day down by 0.329% to close at US$1.2401/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     1.2150

Intraday  Resistance Levels
R1     1.2400
R2     1.2450
R3     1.2510-1.2560

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.315 Buy
20-DMA   1.2342 Buy
50-DMA   1.2342 Buy
100-DMA   1.2106 Buy
200-DMA   1.1905 Buy
STOCH(5,3)   73.141 Buy
MACD(12,26,9)   0.0019 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.4065/GBP, high of US$1.4243/GBP and settled the day down by 0.499% to close at US$1.4155/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 1.4250-1.4500 with targets at 1.4150--1.4070-1.4010 and 1.3900-1.3855. Buy above 1.4150-1.4000 with stop loss closing below 1.3900 targeting 1.4150-1.4250 and 1.4350-1.4500.

 
Intraday Support Levels
S1     1.4150
S2     1.4000
S3     1.4000

Intraday Resistance Levels
R1     1.4250-1.4300
R2     1.4350
R3     1.4500

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

63.100

Buy
20-DMA   1.3976 Sell
50-DMA   1.3987 Buy
100-DMA   1.3694 Buy
200-DMA   1.3390 Buy
STOCH(5,3)   76.330 Sell
MACD(12,26,9)   0.0072 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY105.31/USD and made an intraday high of JPY105.89/USD and settled the day down by 0.066% at JPY105.32/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     105.50-104.90
S2     104.40
S3     106.00-106.70

INTRADAY RESISTANCE LEVELS
R1     106.00-106.70
R2     107.50
R3     108.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.385 Buy
20-DMA   106.05 Sell
50-DMA   107.59 Sell
100-DMA   110.08 Sell
200-DMA   110.82 Sell
STOCH(9,6)   31.062 Sell
MACD(12,26,9)   -0.666 Sell

AAFX TRADING
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