AAFX TRADING

Daily Market Lookup

  • Asian shares fell on Wednesday as a rise in U.S. bond yields above 3 percent and warnings from bellwether U.S. companies of higher costs drove fears that a boom in corporate earnings may be near its peak. Corporate earnings are in solid shape, with analysts estimating 21.1 percent growth in the Jan-March quarter among U.S. S&P500 firms, according to Thomson Reuters data. A similar trend is expected globally. Creeping gains in U.S. Treasury yields are fuelling fears that portfolio managers may move money into safer fixed-income securities at the expense of riskier assets like stocks and emerging markets. The 10-year yield, a benchmark for global borrowing costs, has been driven steadily higher by a combination of concerns over inflation, growing debt supply, and rising Federal Reserve borrowing costs. Fed Funds rate futures prices <0#FF:> have been constantly falling this month, pricing in a considerable chance of three more rate hikes by the end of this year.
  • The dollar inched up on Wednesday, approaching its recent four-month high as the U.S. 10-year bond yield poked above 3 percent to hit its highest level since early 2014. The greenback had risen without pause through much of the past week as U.S.-China trade conflict woes receded and allowed the market to turn its attention back to dollar-supportive fundamentals, notably the surge by U.S. yields. Tuesday's data on U.S. consumer confidence and new home sales, both stronger in April, bolstered the case that the world's biggest economy will continue to grow in the coming quarters. While the weakening by equities was supportive for the yen, often sought when stocks fall due to its perceived safe-haven status, analysts said the dollar was still likely headed for further gains in the longer-term. The currency has faced pressure from a resurgent dollar and also by increasing expectations that the Reserve Bank of New Zealand would hold off from raising rates through 2018 after data last week showed the country's inflation nearing the bottom of the central bank's target. As the U.S.-China trade conflict woes receded, global investors all eyed the rising United States 10-Year in recent days that surged to 3% on Tuesday, a new high since early 2014. The increase was driven by fears of rising inflation and speculations that the Federal Reserve will be more aggressive in raising interest rates in 2018. The yield is a barometer for mortgage rates and other financial instruments. Higher yields could lead to higher mortgage and business loan interest rates, as well as reduced spending that would push stocks lower.
  • Oil prices were stable on Wednesday, but were below the more than three-year highs reached the previous session as rising U.S. fuel inventories and production weighed on an otherwise bullish market. An oil pump is seen at sunset outside Vaudoy-en-Brie, near Paris, France April 23, 2018. Despite Wednesday’s dips, which traders said were also a result of profit-taking after Tuesday’s highs, many analysts say the period of oversupply that started in 2014 has now ended due to supply disruptions and also strong demand. That has been driven by production cuts led by the OPEC which were introduced in 2017 with the aim of propping up the market, but also because of political risk to supplies in the Middle East, Venezuela and Africa. Despite this, Otunga said “the sustainability of the rally is a concern” as it was fueled largely by political risk in the Middle East. With most U.S. producers now profitable at prices under $40 per barrel and the forward curve significantly higher than that for years to come, American drillers will likely continue to increase output as they are able to hedge themselves profitably for the foreseeable future. U.S. crude oil production C-OUT-T-EIA has already shot up by more than a quarter since mid-2016 to over 10.54 million barrels per day (bpd), taking it past Saudi Arabia’s output of around 10 million bpd. Only Russia currently produces more, at almost 11 million bpd. U.S. crude inventories rose by 1.1 million barrels in the week to April 20 to 429.1 million, according to a report by the American Petroleum Institute on Tuesday. Official weekly U.S. fuel inventory and crude production data will be published on Wednesday by the EIA. “Should a larger than expected build occur in U.S. inventories, we can expect a swing in prices as markets have been shown to be extremely sensitive to weekly U.S. petroleum data,” Singapore-based Phillip Futures said in a note.

 

 
Intraday RESISTANCE LEVELS
25th 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 67.90-68.90 69.60 70.50
EURO/USD 1.2250-1.2300 1.2400 1.2450-1.2510
GBP/USD 1.4025 1.4080 1.4150-1.4210
USD/JPY 109.60-110.00 110.50 111.00

Intraday SUPPORTS LEVELS
25th 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 67.50 67.00 66.50-66.00
EURO/USD 1.2200-1.2150 1.2090 1.2000
GBP/USD 1.3910 1.3830-1.3750 1.3700
USD/JPY 108.40 107.50-107.00 106.30

Intra-Day Strategy (25th 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 Tuesday made its intraday high of US$1332.03/oz and low of US$1322.03/oz. Gold was up by 0.437% at US$1330.28/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 Tuesday made its intraday high of US$16.74/oz and low of US$16.55/oz. Silver settled down by 0.663% at US$16.70/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   50.404 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 Tuesday made an intra‐day high of US$69.30/bbl, intraday low of US$67.49/bbl and settled up by 1.799% to close at US$67.65/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 67.90-70.50 with stop loss at 70.50; targeting 67.50-66.50 and 66.00-65.20. Buy above 67.50-66.00 with risk daily closing below 66.00 and targeting 67.90-68.90-69.60 and 70.50-72.00.

 
Intraday Support Levels
S1     67.50
S2     67.00
S3     66.50-66.00

Intraday Resistance Levels
R1     67.90-68.90
R2     69.60
R3     70.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.223 Sell
20-DMA   66.27 Buy
50-DMA   64.39 Buy
100-DMA   62.11 Buy
200-DMA   58.55 Buy
STOCH(5,3)   52.733 Sell
MACD(12,26,9)   1.323 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.2181/EUR, high of US$1.2244/EUR and settled the day up by 0.196% to close at US$1.2231/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     1.2200-1.2150
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   39.596 Buy
20-DMA   1.2300 Sell
50-DMA   1.2292 Sell
100-DMA   1.2196 Buy
200-DMA   1.1970 Buy
STOCH(5,3)   13.192 Sell
MACD(12,26,9)   -0.0013 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3917/GBP, high of US$1.3986/GBP and settled the day up by 0.265% to close at US$1.3975/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 Tuesday made intra‐day low of JPY108.53/USD and made an intraday high of JPY109.16/USD and settled the day up by 0.101% at JPY108.80/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 109.60-111.00 with risk above 111.00 targeting 108.40-107.50-107.00 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     108.40
S2     107.50-107.00
S3     106.30

INTRADAY RESISTANCE LEVELS
R1     109.60-110.00
R2     110.50
R3     111.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   68.896 Buy
20-DMA   107.44 Buy
50-DMA   107.44 Buy
100-DMA   108.43 Sell
200-DMA   109.59 Sell
STOCH(9,6)   60.682 Buy
MACD(12,26,9)   0.507 Sell

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