AAFX TRADING

Daily Market Lookup

  • Asian stocks sagged on Thursday after Wall Street slumped on an extended sell-off in tech firms, while the dollar dipped as it lost some momentum after surging to a one-week high. Possible government regulation of the tech sector has rattled investors, with Amazon losing over $30 billion of its market value in overnight trade on a report U.S. President Donald Trump wants to rein in the growing power of the world’s largest online retailer. Japan has sounded out the North Korean government about a bilateral summit, and Pyongyang has discussed the possibility of a leaders’ meeting with Japan and other countries, Japan’s Asahi newspaper said on Thursday. Earlier, North Korea’s leader Kim Jong Un pledged his commitment to denuclearisation and to meet U.S. officials, Beijing said on Wednesday after Kim met with Chinese President Xi Jinping. The United States and South Korea agreed on Tuesday to revise their six-year-old trade pact with a side deal to deter competitive currency devaluation by Seoul and with concessions for U.S. autos and pharmaceutical companies. Focus was on whether the Trump administration would press China for currency reassurances as part of the trade negotiations, like those secured from South Korea. Fears of a full-blown trade war have eased on hopes that negotiations can foster a compromise, but concerns remained. Growth in China’s manufacturing sector likely picked up slightly in March as authorities lifted winter industrial pollution restrictions and steel mills cranked up production as construction activity swings back into high gear. The official manufacturing PMI is expected to have risen to 50.5 in March, from February’s 50.3, according to a median forecast of 29 economists in a Reuters poll. Overall, China’s economic data so far this year suggest the economy has carried solid growth momentum into the first quarter from last year, with a government think tank forecasting the economy will grow 6.9 percent in the first half. That would keep global growth on track. But economists are sticking to forecasts that China’s pace will slow later in the year, weighed down by a cooling property markets and rising borrowing costs. A sharp escalation in trade tensions with the United States has also clouded the outlook and may have started to dampen exporters’ confidence. U.S. President Donald Trump last week imposed tariffs on steel and aluminum imports and targeted China by announcing plans for tariffs on up to $60 billion of Chinese goods. Economists expect a private survey on China’s factory activity next week will show a similar firming trend as in the official survey, after growth in February picked up to a six-month high. They predict the private Caixin/Markit Manufacturing PMI will be 51.7 in March versus 51.6 the previous month. The private survey tends to focus on small and mid-sized firms, which have not benefited as much from a year-long, state-led construction boom as large, government-owned industrial heavyweights.
  • The dollar dipped against the yen on Thursday a day after posting its largest daily percentage gains in around six months boosted by faster U.S. economic growth and hopes for a diplomatic breakthrough with North Korea. The dollar was boosted after data on Wednesday showing that the U.S. economy grew by a larger than initially estimated 2.9% in the fourth quarter. The data left the way clear for a slightly more aggressive pace of interest rates hikes by the Federal Reserve this year. The Fed hiked rates for the first time this year last week and stuck to its projection for three rate hikes this year. The developments prompted speculation that a breakthrough over North Korea's nuclear program could be growing closer. The single currency remained on the defensive after soft euro zone economic data and dovish-sounding comments by Erkki Liikanen, a member of European Central Bank's governing council earlier in the week. Investors were looking ahead to U.S. consumption and price data later in the day, which will be closely watched for indications on the possible direction of monetary policy.
  • Oil prices rose on Thursday as the producer cartel OPEC and other suppliers look set to continue withholding output for the rest of the year and potentially into 2019. The Middle East-dominated OPEC together with a group of non-OPEC producers led by Russia started cutting output in 2017 to rein in oversupply and prop up the market. Brent, off which OPEC prices most its crude exports, has risen by around a quarter since then, which has lead to speculation that the restraints on production may be lifted. But sources at OPEC told Reuters this week that the group and its allies were set to keep their deal on cutting production for the rest of 2018. Commercial U.S. crude inventories rose by 1.6 million barrels in the last week to 429.95 mn barrels, the EIA said on Wednesday. U.S. crude oil production hit a record, at 10.43 mn bpd. That puts the United States ahead of top exporter Saudi Arabia. Only Russia pumps out more, at 11 million bpd. The latest drop takes the fall since the contract's launch on Monday to 10% Despite high volatility and lingering skepticism about Shanghai's trading hours, along with doubts about the process for physical delivery of crude under contract, most analysts expect the contract to establish itself as a third global oil price benchmark next to Brent and WTI.

 

 
Intraday RESISTANCE LEVELS
29th March 2018 R1 R2 R3
GOLD-XAU 1,331-1,340 1,350 1,357-1,363
Silver-XAG 16.50-17.00 17.40 17.70-18.20
Crude Oil 65.20 66.00 66.60-67.00
EURO/USD 1.2350-1.2400 1.2450 1.2510-1.2560
GBP/USD 1.4070-1.4120 1.4150 1.4250-1.4300
USD/JPY 106.00-106.70 107.50 108.70

Intraday SUPPORTS LEVELS
29th March 2018 S1 S2 S3
GOLD-XAU 1,320 1,311-1306 1,290
Silver-XAG 16.00-15.80 15.60 15.00
Crude Oil 64.50-64.20 63.10 62.40
EURO/USD 1.2300-1.2210 1.2150 1.2090
GBP/USD 1.4050-1.4000 1.3910 1.3820
USD/JPY 105.50-104.90 104.40 103.90-103.10

Intra-Day Strategy (29th 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 Wednesday made its intraday high of US$1344.77/oz and low of US$1323.26/oz. Gold was down by 1.552% at US$1324.61/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 1331-1363 keeping stop loss closing above 1363 and targeting 1320-1311 and 1306-1290. Buy above 1320-1290 with risk below 1310, targeting 1331-1340-1350 and 1357-1362-1370.

 
Intraday Support Levels
S1     1,320
S2     1,311-1306
S3     1,290
Intraday Resistance Levels
R1     1,331-1,340
R2     1,350
R3     1,357-1,363

Technical Indicators

Name   Value Action
14DRSI  

47.538

Buy
20-DMA   1326.65 Sell
50-DMA  

1331.35

Buy
100-DMA   1309.32 Buy
200-DMA   1293.02 Buy
STOCH(5,3)   77.422 Sell
MACD(12,26,9)   1.790 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$16.55/oz and low of US$16.23/oz. Silver settled down by 1.334% at US$16.27/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 16.00-15.00 targeting 16.50-17.00-17.75 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     16.00-15.80
S2     15.60
S3     15.00

Intraday  Resistance Levels
R1     16.50-17.00
R2     17.40
R3     17.70-18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.930 Buy
20-DMA   16.45 Sell
50-DMA   16.64 Sell
100-DMA   16.66 Sell
200-DMA   16.76 Sell
STOCH(5,3)   23.475 Sell
MACD(12,26,9)   -0.0615 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$65.08/bbl, intraday low of US$63.69/bbl and settled down by 0.108% to close at US$64.59/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 65.20-68.00 with stop loss at 68.00; targeting 64.60-64.20-63.10 and 62.70-62.00. 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     64.50-64.20
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   57.705 Sell
20-DMA   62.81 Sell
50-DMA   62.76 Sell
100-DMA   60.84 Buy
200-DMA   54.98 Buy
STOCH(5,3)   34.192 Sell
MACD(12,26,9)   0.814 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.2299/EUR, high of US$1.2421/EUR and settled the day down by 0.758% to close at US$1.2307/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 and 1.2160-1.2090 with stop-loss at daily closing above 1.2600. Buy above 1.2300-1.2090 with risk below 1.2090 targeting 1.2350-1.2400-1.2450 and 1.2510-1.2570.

 
Intraday Support Levels
S1     1.2300-1.2210
S2     1.2150
S3     1.2090

Intraday  Resistance Levels
R1     1.2350-1.2400
R2     1.2450
R3     1.2510-1.2560

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.081 Buy
20-DMA   1.2340 Buy
50-DMA   1.2342 Buy
100-DMA   1.2112 Buy
200-DMA   1.1910 Buy
STOCH(5,3)   33.361 Sell
MACD(12,26,9)   0.00096 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.4069/GBP, high of US$1.4199/GBP and settled the day down by 0.565% to close at US$1.4075/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 oversold 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 1.4070-1.4300 with targets at 1.4050-1.4010 and 1.3910-1.3820. Buy above 1.4050-1.3820 with stop loss closing below 1.3820 targeting 1.4150-1.4250 and 1.4350-1.4500.

 
Intraday Support Levels
S1     1.4050-1.4000
S2     1.3910
S3     1.3820

Intraday Resistance Levels
R1     1.4070-1.4120
R2     1.4150
R3     1.4250-1.4300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

54.140

Buy
20-DMA   1.3985 Sell
50-DMA   1.3988 Buy
100-DMA   1.3702 Buy
200-DMA   1.3396 Buy
STOCH(5,3)   30.498 Sell
MACD(12,26,9)   0.0072 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday 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     103.90-103.10

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

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