AAFX TRADING

Daily Market Lookup

  • Asian stocks steadied after hitting two-week lows on Tuesday as investors paused for breathe following a heavy sell-off in recent sessions and waited to see if the dollar's rally was sustainable. U.S. bond prices rebounded too, capping four days of losses that sent 10-year Treasury yields closer to the key psychological barrier of 3 percent - a level not seen since early 2014. The U.S. dollar, which has risen in the past five sessions against a basket of major currencies, also took a breather to camp near a four-month peak. The bond market is bracing for combined sales of $96 billion in coupon-bearing Treasuries this week on greater government borrowing following a massive tax overhaul last year and a two-year budget agreement reached in February. Inflation worries are also mounting as oil and commodity prices have been rising in recent weeks. A market gauge of investors' inflation expectations such as the 5-year forward inflation swap and 10-year breakeven yield have hit their highest levels in many months. These factors have stoked concerns that U.S. inflation, long subdued since the financial crisis a decade ago, could gain momentum as President Donald Trump's tax cuts this year could stimulate an economy already near or at full employment. In such a scenario the U.S. Federal Reserve could raise rates more than three times this year in a further blow to equities. The greenback also strengthened against emerging market currencies, hitting three-month highs against the South African rand and a 1-1/2-year top against the Brazilian real But market players were not convinced the rally is here to stay. The euro held at after hitting its lowest since March 1 when Trump unveiled tariffs on imported steel and aluminum.
  • The dollar set a three-month high against a basket of currencies on Tuesday, having gained a boost as the U.S. 10-year Treasury yield climbed toward the psychologically key 3 percent level, driven by worries about the growing supply of government debt and inflationary pressures from rising oil prices. As a result, U.S.-Japan and U.S.-German yield differentials have recently widened in the dollar's favor, leaving the yen and the euro lower. The yen, a safe haven currency that tends to rise in times of economic uncertainty but weakens when investor confidence returns, has come under pressure in recent sessions as worries over geopolitical risks and global trade tensions eased. U.S. Treasury Secretary Steven Mnuchin said on Saturday he may travel to China, a move that could ease tensions between the world's two largest economies. The rise in U.S. bond yields has dented emerging market currencies and bond markets, including those in Asia. Market participants said foreign investors may have been buying the dollar against the rupiah via NDFs in recent trading sessions to hedge against the risk of further dollar appreciation. Dollar-denominated assets such as gold are sensitive to moves in the dollar – a gain in the dollar makes gold more expensive for holders of foreign currency and thus decreases demand for the precious metal. Also weighing on gold prices was weaker demand for safe-haven assets after geopolitical tensions eased following easing U.S-China trade-war fears and amid signs of progress toward peace talks on the Korean peninsula. U.S. Treasury Secretary Steven Mnuchin said on Saturday he may travel to China to discuss trade-related issues, while North Korea’s leader Kim Jong Un said he might be open to putting nuclear tests on hold.
  • Brent crude oil rose for a sixth day on Tuesday to hit its highest since November, 2014 at over $75 a barrel, buoyed by expectations that supplies will tighten just as demand reaches record levels. Oil pumps are seen at sunset outside Vaudoy-en-Brie, near Paris, France April 23, 2018. Brent’s six-day rising streak is the longest such string of gains since December, with prices up more than 20 percent from 2018-lows plumbed in February. Markets have been lifted by supply cuts led by the OPEC which were introduced in 2017 with the aim of propping up the market. The potential of renewed U.S. sanctions against Iran is also pushing prices higher. The United States has until May 12 to decide whether it will leave the Iran nuclear deal and re-impose sanctions against OPEC’s third-largest producer, which would further tighten global supplies. OPEC’s efforts to tighten markets are being led by top exporter Saudi Arabia, where state-controlled oil firm Saudi Aramco is pushing for higher prices ahead of a partial listing planned for later this year or 2019. OPEC’s supply curtailments and the threat of new sanctions are occurring just as demand in Asia, the world’s biggest oil consuming region, has risen to a record as new and expanded refineries start up from China to Vietnam. One of the few factors that has limited oil prices from surging even more is U.S. production, which has shot up by more than a quarter since mid-2016 to over 10.54 million bpd, taking it past Saudi Arabia’s output of around 10 mn bpd. As a result of its rising output, U.S. crude is increasingly appearing on global markets, from Europe to Asia, undermining OPEC’s efforts to tighten the market.

 

 
Intraday RESISTANCE LEVELS
24th April 2018 R1 R2 R3
GOLD-XAU 1,331-1,340 1,350 1,357-1,363
Silver-XAG 17.00 17.40 17.70-18.20
Crude Oil 69.60 70.50 72.00-72.80
EURO/USD 1.2250-1.2300 1.2400 1.2450-1.2510
GBP/USD 1.4025 1.4080 1.4150-1.4210
USD/JPY 108.90 109.60-110.00 110.50

Intraday SUPPORTS LEVELS
24th April 2018 S1 S2 S3
GOLD-XAU 1,321-1,311 1,304 1,295
Silver-XAG 16.40-16.00 15.60 15.00
Crude Oil 68.90-67.90 67.00 66.50-66.00
EURO/USD 1.2210-1.2150 1.2090 1.2000
GBP/USD 1.3910 1.3830-1.3750 1.3700
USD/JPY 108.00 106.70 106.70

Intra-Day Strategy (24th April 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$1335.37/oz and low of US$1324.63/oz. Gold was down by 0.743% at US$1324.63/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1326) and breakage below will call for 1316-1300. 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 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 1321-1311 and 1303-1295. Buy above 1321-1295 with risk below 1295, targeting 1331-1340 and 1350-1357.

 
Intraday Support Levels
S1     1,321-1,311
S2     1,304
S3     1,295
Intraday Resistance Levels
R1     1,331-1,340
R2     1,350
R3     1,357-1,363

Technical Indicators

Name   Value Action
14DRSI  

45.150

Buy
20-DMA   1336.31 Sell
50-DMA  

1331.46

Buy
100-DMA   1321.26 Buy
200-DMA   1303.91 Buy
STOCH(5,3)   1.223 Buy
MACD(12,26,9)   8.807 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$17.10/oz and low of US$16.58/oz. Silver settled down by 2.92% at US$16.60/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (16.77), 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 negative crossover to show downside 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 16.50-16.00-15.60 and 15.00-14.50.

 
Intraday  Support Levels
S1     16.40-16.00
S2     15.60
S3     15.00

Intraday  Resistance Levels
R1     17.00
R2     17.40
R3     17.70-18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.190 Buy
20-DMA   16.68 Sell
50-DMA   16.62 Sell
100-DMA   16.66 Sell
200-DMA   16.78 Sell
STOCH(5,3)   29.161 Sell
MACD(12,26,9)   0.095 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$68.96/bbl, intraday low of US$67.07/bbl and settled up by 1.042% to close at US$68.81/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 69.60-72.80 with stop loss at 72.80; targeting 68.90-67.90-66.50 and 66.00-65.20. Buy above 68.90-66.00 with risk daily closing below 66.00 and targeting 69.60-70.50 and 72.00-72.80.

 
Intraday Support Levels
S1     68.90-67.90
S2     67.00
S3     66.50-66.00

Intraday Resistance Levels
R1     69.60
R2     70.50
R3     72.00-72.80

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.506 Sell
20-DMA   66.26 Buy
50-DMA   64.32 Buy
100-DMA   62.02 Buy
200-DMA   58.47 Buy
STOCH(5,3)   76.752 Sell
MACD(12,26,9)   1.492 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.2196/EUR, high of US$1.2289/EUR and settled the day down by 0.521% to close at US$1.2207/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.2164), which become immediate resistance level, break below will target 1.2150-1.2000. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral territory and giving positive crossovers to signal for bullish 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 1.2250-1.2510 targeting 1.2200-1.2160 and 1.2090-1.2000 with stop-loss at daily closing above 1.2510. Buy above 1.2200-1.2000 with risk below 1.2000 targeting 1.2250-1.2300-1.2350 and 1.2400-1.2450.

 
Intraday Support Levels
S1     1.2210-1.2150
S2     1.2090
S3     1.2000

Intraday  Resistance Levels
R1     1.2250-1.2300
R2     1.2400
R3     1.2450-1.2510

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.199 Buy
20-DMA   1.2307 Sell
50-DMA   1.2294 Sell
100-DMA   1.2195 Buy
200-DMA   1.1967 Buy
STOCH(5,3)   11.029 Buy
MACD(12,26,9)   -0.0013 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3925/GBP, high of US$1.4030/GBP and settled the day down by 0.525% to close at US$1.3939/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.3953) 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 1.4025-1.4300 with targets at 1.3900-1.3830 and 1.3750-1.3700. Buy above 1.3910-1.3830 and 1.3750-1.3700 with stop loss closing below 1.3830 targeting 1.4025-1.4080-1.4150 and 1.4210-1.4300.

 
Intraday Support Levels
S1     1.3910
S2     1.3830-1.3750
S3     1.3700

Intraday Resistance Levels
R1     1.4025
R2     1.4080
R3     1.4150-1.4210

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

39.603

Buy
20-DMA   1.4088 Buy
50-DMA   1.4017 Buy
100-DMA   1.3854 Buy
200-DMA   1.3597 Buy
STOCH(5,3)   2.586 Sell
MACD(12,26,9)   0.0049 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY107.67/USD and made an intraday high of JPY108.74/USD and settled the day up by 0.853% at JPY108.67/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 108.90-110.50 with risk above 110.50 targeting 108.00-107.50-107.00 and 106.70-106.00. Long positions above 108.00-106.00 with targets of 108.90-109.60 and 110.00-110.50 with stop below 104.90.

 
Intraday Support Levels
S1     108.00
S2     106.70
S3     106.70

INTRADAY RESISTANCE LEVELS
R1     108.90
R2     109.60-110.00
R3     110.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   67.3986 Buy
20-DMA   107.27 Buy
50-DMA   107.37 Buy
100-DMA   108.41 Sell
200-DMA   109.57 Sell
STOCH(9,6)   94.125 Buy
MACD(12,26,9)   0.4227 Sell

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