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Daily Market Lookup

  • Asian shares eased on Thursday after the Federal Reserve raised interest rates and struck a more hawkish tone by forecasting a slightly faster tightening, while concerns about weak Chinese data and U.S.-China trade frictions kept investors on edge. Surprisingly weak Chinese retail sales and urban investment data curbed investors' risk appetite by adding to doubts over the world's second-largest economy as its central bank unexpectedly left interest rates on hold rather than follow the Fed higher. The Fed raised its benchmark overnight lending rate a quarter of a percentage point to a range of 1.75 percent to 2 percent, as expected, on the back of strong U.S. economic growth. Fed policymakers' rates projections pointed to two additional hikes by the end of this year compared to one previously, based on board members' median forecast. The spectre of higher borrowing costs hit stocks while boosting U.S. bond yields and the dollar. The overall market reaction was short-lived, however While the Fed slightly accelerated the pace of rate hikes in coming months, it dropped a reference from the statement that interest rates are likely to remain below levels that are expected to prevail in the longer run. Keeping investors in check were concerns about U.S. threats to impose tariffs on billions of dollars in Chinese goods. U.S. President Donald Trump will meet with his top trade advisers on Thursday to decide on whether to activate the tariffs, a senior Trump administration official said. In the currency market, the dollar had erased all its post-Fed gains as traders' focus quickly shifted to the European Central Bank's policy meeting later in the day. Recent comments from top ECB officials have sparked expectations the ECB may offer clues on its intentions to end its bond purchases by the end of the year at its upcoming meeting. The Australian dollar fell 0.35 percent to $0.7551 after China reported weaker-than-expected activity data for May, adding to views the economy is finally starting to slow under the weight of a prolonged crackdown on riskier lending that is pushing up borrowing costs for companies and consumers. Some emerging market currencies have been hit by worries higher U.S. interest rates could prompt investors to shift funds to the United States and also squeeze dollar borrowers in emerging markets.
  • The Federal Reserve raised interest rates on Wednesday, a move that was widely expected but still marked a milestone in the U.S. central bank’s shift from policies used to battle the 2007-2009 financial crisis and recession. In raising its benchmark overnight lending rate a quarter of a percentage point to a range of 1.75 percent to 2 percent, the Fed dropped its pledge to keep rates low enough to stimulate the economy “for some time” and signaled it would tolerate inflation above its 2 percent target at least through 2020. He added that continued steady rate increases would nurture the expansion, as the Fed approaches a sort of sweet spot with its employment and inflation goals largely met, the economy withstanding higher borrowing costs and no sign of a spike in inflation. The ongoing economic expansion coupled with solid job growth has pushed the Fed to raise rates seven times since late 2015, rendering the language of its previous policy statements outdated. Policymakers’ fresh economic projections, also issued on Wednesday, indicated a slightly faster pace of rate increases in the coming months, with two additional hikes expected by the end of this year, compared to one previously. They see another three rate increases next year, a pace unchanged from their projections in March. Powell also announced the central bank would start holding news conferences after every policy meeting next year, which means a total of eight in 2019. The Fed chief currently holds four such events each year. Fed policymakers projected gross domestic product would grow 2.8 percent this year, slightly higher than previously forecast, and dip to 2.4 percent next year, while inflation is seen hitting 2.1 percent this year and remaining there through 2020. That’s a welcome change from recent years when Fed policymakers fretted about an inflation rate well below target. The unemployment rate, currently at an 18-year low of 3.8 percent, is expected to fall to 3.6 percent this year, compared to the 3.8 percent that the Fed projected in March.

 

 
Intraday RESISTANCE LEVELS
14th June 2018 R1 R2 R3
GOLD-XAU 1,305 1,311 1,321-1,330
Silver-XAG 17.00 17.40 17.70-18.20
Crude Oil 67.00 68.10-69.00 69.60
EURO/USD 1.1850-1.1905 1.1930 1.2010
GBP/USD 1.3450 1.3500 1.3550-1.3610
USD/JPY 110.50-111.00 111.50 112.00-112.50

Intraday SUPPORTS LEVELS
14th June 2018 S1 S2 S3
GOLD-XAU 1,295 1,280-1,274 1,265
Silver-XAG 16.60-16.31 16.00 15.60-15.30
Crude Oil 66.30 65.70 65.00-64.50
EURO/USD 1.1800 1.1700-1.1650 1.1600
GBP/USD 1.3360 1.3300-1.3260 1.3200
USD/JPY 109.90 109.00 108.50-07.60

Intra-Day Strategy (14th June 2018)
GOLD-XAU Sell on Strength
Silver-XAG Neutral
Crude Oil Neutral
EUR/USD Neutral to Buy
GBP/USD Neutral to Buy
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Thursday made its intraday high of US$1301.08/oz and low of US$1292.00/oz. Gold was up by 0.293% at US$1299.42/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 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 1305-1331 keeping stop loss closing above 1331 and targeting 1295-1280-1274 and 1265-1259. Buy above 1289-1265 with risk below 1280, targeting 1295-1305-1311 and 11321-1331.

 
Intraday Support Levels
S1     1,295
S2     1,280-1,274
S3     1,265
Intraday Resistance Levels
R1     1,305
R2     1,311
R3     1,321-1,330

Technical Indicators

Name   Value Action
14DRSI  

44.341

Buy
20-DMA   1300.52 Sell
50-DMA  

1310.27

Sell
100-DMA   1312.78 Sell
200-DMA   1303.83 Buy
STOCH(5,3)   35.391 Sell
MACD(12,26,9)   -5.478 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$17.09/oz and low of US$16.78/oz. Silver settled up by 1.249% at US$17.02/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 16.60-14.90 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 16.60-16.30-16.00 and 15.60-15.00.

 
Intraday  Support Levels
S1     16.60-16.31
S2     16.00
S3     15.60-15.30

Intraday  Resistance Levels
R1     17.00
R2     17.40
R3     17.70-18.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.673 Buy
20-DMA   16.56 Sell
50-DMA   16.54 Sell
100-DMA   16.58 Sell
200-DMA   16.69 Sell
STOCH(5,3)   79.807 Buy
MACD(12,26,9)   -0.0055 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$66.76/bbl, intraday low of US$65.43/bbl and settled down by 0.788% to close at US$65.45/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 oversold 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 66.30-69.00 with stop loss at 69.00; targeting 65.20-64.50 and 63.00-61.80. Buy above 65.00-61.80 with risk daily closing below 61.70 and targeting 65.70-66.30-67.00 and 68.10-69.30.

 
Intraday Support Levels
S1     66.30
S2     65.70
S3     65.00-64.50

Intraday Resistance Levels
R1     67.00
R2     68.10-69.00
R3     69.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.0412 Sell
20-DMA   67.03 Buy
50-DMA   67.10 Buy
100-DMA   65.26 Buy
200-DMA   61.38 Buy
STOCH(5,3)   80.185 Sell
MACD(12,26,9)   -0.854 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1724/EUR, high of US$1.1800/EUR and settled the day up by 0.400% to close at US$1.1790/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 Buy

Buy above 1.1800-1.1450 with risk below 1.1450 targeting 1.1850-1.1930 and 1.2010-1.2090-. Sell below 1.1850-1.2010 targeting 1.1800-1.1770 and 1.1725-1.1600-1.1550 with stop-loss at daily closing above 1.2010.

 
Intraday Support Levels
S1     1.1800
S2     1.1700-1.1650
S3     1.1600

Intraday  Resistance Levels
R1     1.1850-1.1905
R2     1.1930
R3     1.2010

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.526 Buy
20-DMA   1.1774 Sell
50-DMA   1.1904 Sell
100-DMA   1.1992 Buy
200-DMA   1.1921 Buy
STOCH(5,3)   56.071 Buy
MACD(12,26,9)   -0.0038 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3307/GBP, high of US$1.3388/GBP and settled the day down by 0.216% to close at US$1.3372/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 Buy

Based on the charts and explanations above; short positions below 1.3400-1.3700 with targets at 1.3320-1.3260 and 1.3160-1.3100-1.3060. Buy above 1.3300-1.3060 with targets 1.3400-1.3450-1.3550-and 1.3605-1.3700 with stop loss closing below 1.3160.

 
Intraday Support Levels
S1     1.3360
S2     1.3300-1.3260
S3     1.3200

Intraday Resistance Levels
R1     1.3450
R2     1.3500
R3     1.3550-1.3610

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

44.911

Buy
20-DMA   1.3408 Buy
50-DMA   1.3563 Buy
100-DMA   1.3644 Buy
200-DMA   1.3556 Buy
STOCH(5,3)   44.270 Buy
MACD(12,26,9)   -0.0059 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY110.24/USD and made an intraday high of JPY110.83/USD and settled the day down by 0.027% at JPY1110.32/USD.

Technicals in Focus:

In daily charts, JPY is sustaining below 200DMA (109.62), 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 negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 110.50-112.90 with risk above 112.90 targeting 109.60-109.00-108.40 and 107.60-107.00. Long positions above 109.60-106.60 with targets of 110.50-111.00 and 111.50-112.00 with stop below 106.60.

 
Intraday Support Levels
S1     109.90
S2     109.00
S3     108.50-07.60

INTRADAY RESISTANCE LEVELS
R1     110.50-111.00
R2     111.50
R3     112.00-112.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.2388 Buy
20-DMA   109.77 Buy
50-DMA   109.22 Buy
100-DMA   109.10 Sell
200-DMA   109.62 Sell
STOCH(9,6)   67.139 Sell
MACD(12,26,9)   0.236 Sell

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