AAFX TRADING

Daily Market Lookup

  • Asian share markets rallied from nine-month lows on Friday, after China eased foreign investment limits, but underlying sentiment was dampened by worries over trade frictions a week before initial U.S. and Chinese tariffs were set to take effect. After falling to fresh two-year lows on Thursday, shares in China rebounded Friday. While analysts said the jump reflected technical factors, it was helped by news that Beijing would ease foreign investment curbs on sectors including banking, automobiles, heavy industry and agriculture. The country's central bank also said on Thursday that it would ensure that market liquidity remained "reasonably ample." Despite the bump on Friday, analysts downplayed the impact of China's relaxing of investment curbs on broader trade issues. Elsewhere in the region, investors remained focused on concerns over global trade, as the U.S. ambassador to China said Washington was not convinced that China is willing to make fast progress on trade. The U.S. administration is due to activate U.S. tariffs on Chinese goods worth $34 billion on July 6, which is expected to prompt a tit-for-tat response from Beijing. The currency has risen in recent weeks, helped by the U.S. Federal Reserve's move to raise interest rates in June, and expectations of further hikes this year.
  • The dollar held firm versus the yen on Friday after U.S. President Donald Trump indicated a softer approach on Chinese investment in U.S. technology companies. The White House announced on Wednesday that it would not be looking to impose the new 25% new limits on Chinese ownership in U.S. tech-related companies, as reports had suggested earlier in the week. Instead, the government would rely on the newly strengthened Committee on Foreign Investment in the United States, or CFIUS, to deal with concerns.   The prospects of rising U.S. interest rates were also cited as supporting the dollar. Gold prices edged up on Friday on a weaker dollar, but still hover near a more than six-month low. Dollar-denominated assets such as gold are sensitive to moves in the dollar – A fall in the dollar makes gold less expensive for holders of foreign currency and thus, increases demand for the precious metal.  Meanwhile, The Fed is expected to raise interest rates at least four times this year, which would likely dent gold prices.  China’s National Development and Reform Commission published a new version of the so called “negative list” on Thursday. The new rules, which would take effect on July 28, list curbs on sectors including banking, automotive, heavy industry and agriculture.
  • News that leaders at the EU summit had reached an agreement on migration issues drove the EUR/USD higher in morning trade in Asia. This cemented the small up-move seen yesterday after European CPI figures ticked up for the second straight month. No doubt the news will ease some of the pressure on Angela Merkel’s coalition government. As soon as there is any mention of Brexit, the pound struggles for grip, and yesterday was no exception. As European leaders started their 2-day summit meeting yesterday, with Brexit one of the items on the agenda, so the pound slid to its lowest level since November 3. The positive EUR news seems to be dragging GBP higher during the Asian session since there has been no news on any Brexit discussions. As we near the week-, month- and quarter-end, the data calendar still has some interesting points to offer. The revision of the UK’s Q1 GDP data, Q1 current account numbers and the release of consumer credit, mortgage approvals and M4 money supply ensure a busy UK calendar. Euro-zone provisional CPI data for June complete the European calendar while US personal income/spending and PCE data, Chicago PMI and Michigan sentiment come later. The week rounds off with the Baker Hughes US oil rig count and the weekly CFTC positioning data releases.
  • Oil prices slid on Friday, with concerns about escalating trade tension between the U.S. and its major trade partners being cited as catalyst for the selling. Friday's falls came as trade disputes between the United States and economies including China, India and the European Union continued to weigh on market sentiment. U.S. President Donald Trump’s top economic adviser Larry Kudlow said on Wednesday that the president is not retreating on China, although Trump’s plan to crack down on foreign investment is less harsh than many had expected. Traders said Friday's dip could also be a result of profit-taking. Greg McKenna, chief market strategist at AxiTrader said the surging oil price rises had "exhausted the bulls." Oil prices have been rallying since the beginning of the year on tightening market conditions and voluntary supply cuts led by the Middle East dominated producer cartel of the OPEC. Meanwhile, potential U.S. sanctions against OPEC-exporter Iran are also supporting oil prices. Unplanned supply disruptions from Libya to Venezuela also remained in focus. Last week, the OPEC decided to raise output following a key meeting in Vienna. While the decision was widely anticipated, the supply boost was less than some investors had anticipated.

 

 
Intraday RESISTANCE LEVELS
29th June 2018 R1 R2 R3
GOLD-XAU 1,260-1,265 1,271 1,278-1,284
Silver-XAG 16.40-16.60 17.00 17.40-17.70
Crude Oil 72.50 73.20 74.00-75.00
EURO/USD 1.1650 1.1700 1.1820-1.1900
GBP/USD 1.3145 1.3200 1.3260-1.3300
USD/JPY 111.00 111.40-112.00 112.70

Intraday SUPPORTS LEVELS
29th June 2018 S1 S2 S3
GOLD-XAU 1,251 1,243-1,236 1,220
Silver-XAG 16.00 15.60-15.30 14.80
Crude Oil 71.90 70.70 69.60-69.00
EURO/USD 1.1600 1.1500-1.1450 1.1365
GBP/USD 1.3100 1.3050-1.2990 1.2920
USD/JPY 110.50-109.80 109.00 108.50-107.60

Intra-Day Strategy (29th 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$1254.22/oz and low of US$1245.88/oz. Gold was down by 0.305% at US$1248.07/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 negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Sell on Strength

Based on the charts and explanations above; sell below 1260-1290 keeping stop loss closing above 1290 and targeting 1251-1243 and 1236-1220. Buy above 151-1220 with risk below 1220, targeting 1260-1265-1271 and 1278-1289.

 
Intraday Support Levels
S1     1,251
S2     1,243-1,236
S3     1,220
Intraday Resistance Levels
R1     1,260-1,265
R2     1,271
R3     1,278-1,284

Technical Indicators

Name   Value Action
14DRSI  

25.678

Buy
20-DMA   1274.32 Sell
50-DMA  

1292.03

Sell
100-DMA   1301.89 Sell
200-DMA   1299.46 Sell
STOCH(5,3)   12.381 Sell
MACD(12,26,9)   -13.239 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$16.11/oz and low of US$15.90/oz. Silver settled down by 0.187% at US$15.99/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (16.69), 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 oversold region and giving positive crossover to show upside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 16.00-14.90 targeting 16.35-16.60-17.00 and 17.75-18.20; stop breakage below 15.00. Sell below 16.60-18.20 with stop loss above 18.20; targeting 16.60-16.30-16.00 and 15.60-15.00.

 
Intraday  Support Levels
S1     16.00
S2     15.60-15.30
S3     14.80

Intraday  Resistance Levels
R1     16.40-16.60
R2     17.00
R3     17.40-17.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.274 Buy
20-DMA   16.46 Sell
50-DMA   16.51 Sell
100-DMA   16.56 Sell
200-DMA   16.67 Sell
STOCH(5,3)   40.250 Buy
MACD(12,26,9)   0.0727 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$73.24/bbl, intraday low of US$71.54/bbl and settled up by 1.285% to close at US$72.54/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 72.50-75.00 with stop loss at 75.00; targeting 71.90-70.70 and 69.60-69.00-68.10. Buy above 72.50-68.10 with risk daily closing below 68.10 and targeting 71.90-72.50-73.00 and 74.00-75.00.

 
Intraday Support Levels
S1     71.90
S2     70.70
S3     69.60-69.00

Intraday Resistance Levels
R1     72.50
R2     73.20
R3     74.00-75.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.352 Sell
20-DMA   68.37 Buy
50-DMA   67.59 Buy
100-DMA   65.89 Buy
200-DMA   62.22 Buy
STOCH(5,3)   89.036 Buy
MACD(12,26,9)   0.949 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1557/EUR, high of US$1.1600/EUR and settled the day up by 0.147% to close at US$1.11567/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 1.1600-1.1300 with risk below 1.1300 targeting 1.1650-1.1700 and 1.1820-1.1900. Sell below 1.1650-1.1900 targeting 1.1500-1.1490-1.1450 and 1.1370-1.1300 with stop-loss at daily closing above 1.1900.

 
Intraday Support Levels
S1     1.1600
S2     1.1500-1.1450
S3     1.1365

Intraday  Resistance Levels
R1     1.1650
R2     1.1700
R3     1.1820-1.1900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.457 Buy
20-DMA   1.1658 Sell
50-DMA   1.1794 Sell
100-DMA   1.1913 Buy
200-DMA   1.1887 Buy
STOCH(5,3)   32.044 Buy
MACD(12,26,9)   -0.0054 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3105/GBP, high of US$1.3120/GBP and settled the day down by 0.266% to close at US$1.3074/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 positive crossover to confirm bullish 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 1.3145-1.3300 with targets at 1.3100-1.3060 and 1.2990-1.2920. Buy above 1.3100-1.2920 with targets 1.3145-1.3200-1.3260 and 1.3300-1.3360 with stop loss closing below 1.2920.

 
Intraday Support Levels
S1     1.3100
S2     1.3050-1.2990
S3     1.2920

Intraday Resistance Levels
R1     1.3145
R2     1.3200
R3     1.3260-1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

29.559

Buy
20-DMA   1.3267 Buy
50-DMA   1.3440 Buy
100-DMA   1.3562 Buy
200-DMA   1.3521 Buy
STOCH(5,3)   22.5577 Buy
MACD(12,26,9)   -0.0085 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY109.96/USD and made an intraday high of JPY110.65/USD and settled the day up by 0.217% at JPY110.48/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 109.80-112.00 with risk above 112.00 targeting 109.00-108.40 and 107.60-107.00. Long positions above 109.00-107.00 with targets of 109.80-110.50-111.00 and 111.50-112.00 with stop below 107.00.

 
Intraday Support Levels
S1     110.50-109.80
S2     109.00
S3     108.50-107.60

INTRADAY RESISTANCE LEVELS
R1     111.00
R2     111.40-112.00
R3     112.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.907 Buy
20-DMA   110.10 Buy
50-DMA   109.59 Buy
100-DMA   109.34 Sell
200-DMA   109.69 Sell
STOCH(9,6)   33.644 Sell
MACD(12,26,9)   0.132 Sell

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