AAFX TRADING

Daily Market Lookup

  • Asian shares rallied on Friday as risk appetite got a boost from soft U.S. inflation, helping alleviate worries of faster rate hikes by the Federal Reserve, while investors also cheered U.S.-North Korean steps to further ease tensions on the Korean Peninsula. Thursday’s slower-than-expected April consumer price rises followed payrolls data last week which pointed to sluggish wage growth. The two data sets meant “inflation may be rising but not so rapidly that the Fed would have to take aggressive actions to keep the economy from overheating,” said James McGlew, analyst at Perth-based stock broker Argonaut. The recent shakeout in markets, partly stoked by Sino-U.S. trade tensions, has also eased off, while money managers expect the relatively low global rates that fueled the ‘goldilocks’ boom in stock markets last year will remain in place for some time. Indeed, a key measure of expected market swings, the Cboe Volatility Index, or VIX, has fallen very close to levels last seen in early January when stock markets were buoyant. Investors also appeared to welcome continued moves between the United States and North Korea to reduce tensions in the region. U.S. President Donald Trump will meet North Korean leader Kim Jong un in Singapore next month amid high hopes of “doing something very meaningful” to curtail Pyongyang’s nuclear ambitions. Concerns still remain around U.S.-China trade skirmishes and rising tensions in the Middle East, although analysts say the June 12 U.S.-Korea summit will ensure the trade war rhetoric takes a back-seat for now. The United States and China locked horns over import tariffs earlier this year after Trump first announced hefty duties on Chinese goods, provoking a tit-for-tat response from Beijing. Investors trimmed their expectations for four Fed rate hikes after inflation data showed U.S. price pressures remained weak. The Fed has already raised rates once this year and is widely expected to go two more times in 2018. The recent slowing in price growth in major economies has boosted expectations that most central banks except the Fed will continue their massive bond-buying programs to keep policy stimulatory. Malaysian markets were closed Friday but its newly appointed Prime Minister Mahathir Mohamad emerged with key election pledges including repealing an unpopular goods and services tax and restoring a petrol subsidy. Ratings agency Moody’s said some campaign promises would be “credit negative” for Malaysia.
  • The dollar hovered below a 4-1/2-month high against a basket of major currencies on Friday after tepid U.S. inflation data prompted traders to pare bets of faster rate hikes. U.S. consumer prices rose less than expected in April, which would support gradual, rather than more aggressive, rate increases by the Federal Reserve. The so-called core CPI, which strips out the volatile food and energy components, rose 0.1 percent from previous month, compared to economists’ median forecast of 0.2 percent rise. It lodged a year-on-year rise of 2.1 percent, matching March’s increase. While dollar bulls expect U.S. yield advantages to underpin the dollar in the near term, others say its rally appeared to be running out of steam. The single currency has so far weathered the impact from rises in Italian bond yields on signs the country’s two anti-establishment parties could sweep into power as they made “significant steps” towards forming a government. While that would end almost 10 weeks of political stalemate after an inconclusive election on March 4, investors cast a wary eye on a coalition of the 5-Star Movement and far-right League, which are hostile to European Union budget restrictions. Bank of England reduced its growth and inflation outlook for 2018 and 2019 while keeping rates steady as expected. The dollar’s retreat should take the heat off some of emerging market currencies, which have been hit by worries about capital outflows to U.S, where yields are increasingly becoming attractive. The initial ringgit losses came amid some uncertainty after Mahathir Mohamad scored a stunning election win, defeating the coalition that has ruled the nation for six decades since independence from Britain.
  • Oil prices dipped on Friday, easing from multi-year highs in the previous session on hopes that alternative supplies could replace a looming drop in Iranian exports from U.S. sanctions. The United States plans to re-introduce sanctions against Iran, which produces around 4 percent of global oil supplies, after abandoning an agreement reached in late 2015 that limited Tehran’s nuclear ambitions in exchange for removing U.S.-Europe sanctions. The sanctions come amid an oil market that has been tightening due to strong demand, especially in Asia, and as top exporter Saudi Arabia and No.1 producer Russia have led efforts since 2017 to withhold oil supplies to prop up prices. Many analysts expect oil prices to rise significantly, as the market adjusts to looming U.S. sanctions and Iran’s exports sink amid strong demand. There are, however, signs that other suppliers from within the OPEC will step up output to counter the Iran disruption. Outside OPEC, soaring U.S. crude oil production may help fill Iran’s supply gap, hitting another record last week by climbing to 10.7 million barrels per day (bpd).

 

 
Intraday RESISTANCE LEVELS
11th May 2018 R1 R2 R3
GOLD-XAU 1,321 1,331 1,340-1,350
Silver-XAG 17.00 17.40 17.70-18.20
Crude Oil 71.50-71.90 72.80 73.50
EURO/USD 1.1915 1.1950 1.1975-1.2000
GBP/USD 1.3550-1.3605 1.3700 1.3750-1.3830
USD/JPY 109.60 110.00-110.50 111.00

Intraday SUPPORTS LEVELS
11th May 2018 S1 S2 S3
GOLD-XAU 1,311-1,304 1,295 1,289-1,280
Silver-XAG 16.50 16.05-15.60 15.30
Crude Oil 71.00-70.50 70.00 69.60-68.90
EURO/USD 1.1850 1.1800-1.1730 1.1650
GBP/USD 1.3500 1.3450 1.3400-1.3320
USD/JPY 109.00 108.40 107.50-107.00

Intra-Day Strategy (11th May 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 Thursday made its intraday high of US$1322.81/oz and low of US$1310.71/oz. Gold was up by 0.663% at US$1321.18/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 1311-1340 keeping stop loss closing above 1340 and targeting 1303-1295 and 1289-1280. Buy above 1311-1280 with risk below 1280, targeting 1321-1331-1340 and 1350-1357.

 
Intraday Support Levels
S1     1,311-1,304
S2     1,295
S3     1,289-1,280
Intraday Resistance Levels
R1     1,321
R2     1,331
R3     1,340-1,350

Technical Indicators

Name   Value Action
14DRSI  

47.671

Buy
20-DMA   1321.04 Sell
50-DMA  

1324.90

Buy
100-DMA   1319.89 Buy
200-DMA   1305.07 Buy
STOCH(5,3)   78.760 Buy
MACD(12,26,9)   -5.945 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$16.74/oz and low of US$16.33/oz. Silver settled down by 1.58% 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     16.50
S2     16.05-15.60
S3     15.30

Intraday  Resistance Levels
R1     17.00
R2     17.40
R3     17.70-18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.648 Buy
20-DMA   16.54 Sell
50-DMA   16.56 Sell
100-DMA   16.62 Sell
200-DMA   16.74 Sell
STOCH(5,3)   81.512 Sell
MACD(12,26,9)   -0.004 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$71.79/bbl, intraday low of US$70.48/bbl and settled up by 0.224% to close at US$71.32/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 71.50-73.50 with stop loss at 73.50; targeting 71.00-70.50 and 70.00-69.60-68.90. Buy above 71.00-68.90 with risk daily closing below 68.50 and targeting 71.50-72.00 and 72.80-73.50.

 
Intraday Support Levels
S1     71.00-70.50
S2     70.00
S3     69.60-68.90

Intraday Resistance Levels
R1     71.50-71.90
R2     72.80
R3     73.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.973 Sell
20-DMA   68.67 Buy
50-DMA   66.32 Buy
100-DMA   63.66 Buy
200-DMA   59.76 Buy
STOCH(5,3)   91.104 Sell
MACD(12,26,9)   1.063 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1842 /EUR, high of US$1.1945/EUR and settled the day up by 0.548% to close at US$1.1914/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 1.1915-1.2000 targeting 1.1850-1.1800-1.1730 and 1.1650-1.1570 with stop-loss at daily closing above 1.2000. Buy above 1.1850-1.1650 with risk below 1.1570 targeting 1.1850-1.1915-1.1950 and 1.1975-1.2000-1.2090.

 
Intraday Support Levels
S1     1.1850
S2     1.1800-1.1730
S3     1.1650

Intraday  Resistance Levels
R1     1.1915
R2     1.1950
R3     1.1975-1.2000

TECHNICAL INDICATORS
Name   Value Action
14DRSI   24.150 Buy
20-DMA   1.2082 Sell
50-DMA   1.2186 Sell
100-DMA   1.2156 Buy
200-DMA   1.1971 Buy
STOCH(5,3)   24.150 Sell
MACD(12,26,9)   -0.0097 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3459/GBP, high of US$1.3617/GBP and settled the day down by 0.206% to close at US$1.3515/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 1.3550-1.3750 with targets at 1.3500-1.3450 and 1.3400-1.3320. Buy above 1.3500-1.3320 with targets 1.3550-1.3605 and 1.3700-1.3750 with stop loss closing below 1.3450.

 
Intraday Support Levels
S1     1.3500
S2     1.3450
S3     1.3400-1.3320

Intraday Resistance Levels
R1     1.3550-1.3605
R2     1.3700
R3     1.3750-1.3830

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

27.589

Buy
20-DMA   1.3759 Buy
50-DMA   1.3874 Buy
100-DMA   1.3811 Buy
200-DMA   1.3603 Buy
STOCH(5,3)   43.698 Sell
MACD(12,26,9)   -0.0014 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY109.30/USD and made an intraday high of JPY110.01/USD and settled the day down by 0.318% at JPY109.37/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 110.00-112.00 with risk above 112.00 targeting 109.60-109.00-108.40 and 107.50-107.00-106.70. Long positions above 109.00-106.00 with targets of 109.60-110.00 and 110.50-111.00 with stop below 106.00.

 
Intraday Support Levels
S1     109.00
S2     108.40
S3     107.50-107.00

INTRADAY RESISTANCE LEVELS
R1     109.60
R2     110.00-110.50
R3     111.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.912 Buy
20-DMA   108.66 Buy
50-DMA   108.08 Buy
100-DMA   108.60 Sell
200-DMA   109.55 Sell
STOCH(9,6)   49.851 Buy
MACD(12,26,9)   0.660 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING