AAFX TRADING

Daily Market Lookup

  • Asian stock markets dipped on Wednesday after Pyongyang abruptly called off talks with Seoul, throwing a U.S.-North Korean summit into doubt, while surging bond yields revived worries about faster U.S. interest rate hikes that could curb global demand. A cancellation of the June 12 summit in Singapore could see tensions on the Korean peninsula flare again even as investors worry about China-U.S. trade tensions and the sustainability of global economic growth. The rise in yields hurt U.S. share markets on concerns it would undercut stock valuations. The strong U.S. data underpinned the dollar in currency markets. The yen largely shrugged off data that showed Japan’s economy shrank by 0.6% on an annualized basis in the January-March quarter, a sharper contraction than the median estimate of 0.2% and marking the end to eight straight quarters of expansion. High-yielding Asian currencies were particularly vulnerable to higher U.S. yields, which could prompt investors to shift funds out of emerging markets. Crude oil prices remained near recent highs amid concerns U.S. sanctions on Iran may restrict crude exports from a major producer.
  • The dollar hovered near a five-month high against a group of major currencies on Wednesday, as a surge in the benchmark 10-year Treasury yield above 3 percent reignited a rally that had lost steam last week. The dollar has gained since mid-April as easing tensions in the Korean Peninsula and moves by China and the United States to avoid a full-blown trade war allowed investors to focus on the yield advantage the United States enjoys over other countries. The advance stalled last week after weaker-than-expected April U.S. inflation data, but regained traction overnight as strong U.S. consumer spending numbers sent long-term Treasury yields surging to a seven-year peak of 3.095 percent. The 10-year Treasury yield had hovered around 3 percent since late last month on concerns about rising inflation and a ballooning federal budget gap. But until Tuesday, it was unable to convincingly break above 3 percent. The uptick in U.S. yields which unnerved equity markets and sent Wall Street shares significantly lower on Tuesday. The yen’s tends to draw demand in times of market turmoil and investor risk aversion. Broader risk sentiment was also dented after North Korea on Wednesday opted to suspend high-level talks with South Korea and said it may reconsider holding a summit with the United States if Washington continues to unilaterally insist on Pyongyang giving up its nuclear programme.
  • Oil prices retreated from multi-year highs on Wednesday morning in Asia, pulled back by an industry organization’s comment that U.S. crude stockpiles built unexpectedly last week. The American Petroleum Institute said crude stockpiles rose nearly 5 min barrels, compared with analysts’ expectations for a 763,000-barrel draw. Rising U.S. drilling for new oil production has also kept oil prices in check. U.S. drillers added 10 oil rigs in the week to May 11, bringing the total count to 844, the highest level since March 2015. Additionally, oil prices eased as the U.S. dollar strengthened against other currencies. As the dollar strengthens, investors can retreat from dollar-denominated commodities like oil. Oil prices have surged more than 70% over the last year as demand has risen sharply while production has been restricted by OPEC, led by Saudi Arabia, and other producers, including Russia. The tightening market has all but eliminated a global supply overhang which depressed crude prices between late 2014 and early 2017 Looming U.S. sanctions against Iran have also raised fears that oil markets will face shortages later this year when trade restrictions take effect. Iran currently produces around 4% of global oil supplies and is OPEC’s third-largest producer. Meanwhile, traders are worried that near-record high refinery runs in China may be short-lived. China’s refinery runs rose nearly 12% in April from a year earlier, to around 12.1 mn bpd, marking the second-highest level on record on a daily basis.

 

 
Intraday RESISTANCE LEVELS
16th May 2018 R1 R2 R3
GOLD-XAU 1,295-1,305 1,311 1,321-1,331
Silver-XAG 16.50-17.00 17.40 17.70-18.20
Crude Oil 71.00 71.50-71.90 72.80
EURO/USD 1.1850-1.1915 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
16th May 2018 S1 S2 S3
GOLD-XAU 1,289-1,280 1,274 1,265
Silver-XAG 16.05-15.60 15.30 14.90
Crude Oil 70.50 70.00 69.60-68.90
EURO/USD 1.1800-1.1730 1.1660 1.1600
GBP/USD 1.3500 1.3450 1.3400-1.3320
USD/JPY 109.00 108.40 107.50-107.00

Intra-Day Strategy (16th 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 Tuesday made its intraday high of US$1314.77/oz and low of US$1288.63/oz. Gold was down by 1.719% at US$1290.47/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 1300-1340 keeping stop loss closing above 1340 and targeting 1311-1303-1295 and 1289-1280. Buy above 1311-1280 with risk below 1280, targeting 1321-1331-1340 and 1350-1357.

 
Intraday Support Levels
S1     1,289-1,280
S2     1,274
S3     1,265
Intraday Resistance Levels
R1     1,295-1,305
R2     1,311
R3     1,321-1,331

Technical Indicators

Name   Value Action
14DRSI  

35.735

Buy
20-DMA   1315.10 Sell
50-DMA  

1321.91

Sell
100-DMA   1318.65 Sell
200-DMA   1305.11 Buy
STOCH(5,3)   16.865 Buy
MACD(12,26,9)   -7.641 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$16.53/oz and low of US$16.18 /oz. Silver settled down by 0.145% at US$16.25/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 16.05-14.90 targeting 16.50-17.00-17.75 and 18.20-18.60; stop breakage below 15.00. Sell below 16.50-18.20 with stop loss above 18.20; targeting 16.00-15.60 and 15.00-14.50.

 
Intraday  Support Levels
S1     16.05-15.60
S2     15.30
S3     14.90

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.992 Buy
20-DMA   16.49 Sell
50-DMA   16.54 Sell
100-DMA   16.60 Sell
200-DMA   16.73 Sell
STOCH(5,3)   19.954 Sell
MACD(12,26,9)   -0.0469 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$71.22/bbl, intraday low of US$70.45/bbl and settled downby 0.266% to close at US$70.98/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 71.00-73.50 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     70.50
S2     70.00
S3     69.60-68.90

Intraday Resistance Levels
R1     71.00
R2     71.50-71.90
R3     72.80

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.182 Sell
20-DMA   69.04 Buy
50-DMA   66.66 Buy
100-DMA   63.93 Buy
200-DMA   59.98 Buy
STOCH(5,3)   72.996 Sell
MACD(12,26,9)   1.460 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1937/EUR, high of US$1.1937/EUR and settled the day down by 0.746% to close at US$1.1836/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 1.1850-1.2100 targeting 1.1800-1.1730 and 1.1650-1.1600 with stop-loss at daily closing above 1.2150. Buy above 1.1800-1.1600 with risk below 1.1600 targeting 1.1850-1.1915-1.1975 and 1.2000-1.2070.

 
Intraday Support Levels
S1     1.1800-1.1730
S2     1.1660
S3     1.1600

Intraday  Resistance Levels
R1     1.1850-1.1915
R2     1.1950
R3     1.1975-1.2000

TECHNICAL INDICATORS
Name   Value Action
14DRSI   29.562 Buy
20-DMA   1.2005 Sell
50-DMA   1.2132 Sell
100-DMA   1.2131 Buy
200-DMA   1.1967 Buy
STOCH(5,3)   27.104 Sell
MACD(12,26,9)   -0.0101 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.1819/GBP, high of US$1.3571/GBP and settled the day down by 0.368% to close at US$1.3504/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 1.3550-1.3850 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  

26.840

Buy
20-DMA   1.3678 Buy
50-DMA   1.3820 Buy
100-DMA   1.3788 Buy
200-DMA   1.3600 Buy
STOCH(5,3)   39.575 Sell
MACD(12,26,9)   -0.0013 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY109.63/USD and made an intraday high of JPY110.45/USD and settled the day up by 0.629% at JPY110.33/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

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