AAFX TRADING

Daily Market Lookup

  • Chinese stocks went into a tail spin on Tuesday as turbulence gripped equity markets in Asia, which sank to nine-month lows amid heightened anxiety a bitter trade dispute between the United States and major economies could derail global growth. Speculation was rife China's central bank was intervening in the currency market to staunch losses and prevent a potentially destabilizing sell-off in the yuan, while stocks came off a searing sell-off in the morning. Chinese financial markets have been jittery ahead of a July 6 deadline, when the U.S. is set to slap tariffs on $34 billion worth of Chinese goods that Beijing has vowed to match with tariffs on U.S. products. The trade row between the United States and major economies has rattled financial markets over several weeks, with no sign U.S. President Donald Trump is about to back down from his 'America First' protectionism policies that many fear will harm the global economy. Four traders told Reuters that major state-owned banks were seen swapping yuan for dollars in the forwards market and immediately selling some of them into spot market, which helped support the Chinese currency. Traders and economists say major state-owned banks sometimes act on behalf of the central bank in the foreign exchange interbank market. The central bank put the midpoint roughly in line with market expectations at 6.6497 yuan per dollar, its weakest level in about 10 months, setting the stage for the day's drop. Trump told the World Trade Organization on Monday that "we'll be doing something" if the United States is not treated properly, just hours after the European Union said that U.S. automotive tariffs would hurt its own vehicle industry and prompt retaliation. Also on Monday, Washington moved to block China Mobile from offering services to the U.S. telecommunications market, recommending its application be rejected because the government-owned firm posed national security risks. Elsewhere in currency markets, the euro, which had been pressured by political uncertainty in Germany, pared losses after Chancellor Angela Merkel's conservatives settled a row over migration that threatened to topple her governing coalition after interior minister Horst Seehofer dropped his threat to quit.
  • The dollar rose on Tuesday as traders continued to monitor developments on the trade front. The U.S. is set to impose a 25% tariff on $34 billion worth of Chinese goods before on Friday, while China said earlier that it would retaliate with duties on the same value of U.S. products. he dollar eased marginally against its peers on Tuesday, as the euro steadied after partners in Germany's coalition settled a row over migration that had threatened to topple Chancellor Angela Merkel's government. The single currency had slipped on Monday after German Interior Minister Horst Seehofer offered to resign, but it later steadied when his Christian Social Union (CSU) party reached a deal with Merkel's Christian Democrats (CDU) over illegal immigration, and the resignation threat was withdrawn. The Chinese yuan remained volatile on the back of nervousness ahead of July 6, when U.S. tariffs on Chinese exports are due to take effect.
  • Oil prices rose on Tuesday amid reports that Libya declared force majeure on significant amounts of its supply. Libya's National Oil Corporation (NOC) declared force majeure on loadings from Zueitina and Hariga ports on Monday, resulting in total production losses of 850,000 bpd due to the closure of eastern fields and ports. Meanwhile, rising overall output from the OPEC as well as in the U.S. continued to be cited as headwind for oil prices. OPEC's June output was 32.32 million barrels per day (bpd), up 320,000 bpd from May, Reuters reported on Monday. U.S. oil production, which has surged by 30% over the last two years to 10.9 million bpd, were also in focus. Oil prices fell on Monday after U.S. President Donald Trump put pressure on Saudi Arabia to ramp up oil output. "There are ... signs that growth in China has slowed in recent months, particularly infrastructure spending by local governments. I would assume that infrastructure investment is quite energy intensive, so perhaps that had a knock-on effect to oil demand," said Frederic Neumann, Co-Head of Asian Economic Research at HSBC in Hong Kong. In June, 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. Iran's President Hassan Rouhani said regional oil exports may be threatened if the United States tries to pressure clients to stop buying Iranian crude oil, a new agency reported on Tuesday. Iranian officials in the past have threatened to block the Strait of Hormuz, a major oil shipping route, in case of hostile U.S. action against Iran.

 

 
Intraday RESISTANCE LEVELS
3rd July 2018 R1 R2 R3
GOLD-XAU 1,251 1,260-1,265 1,271
Silver-XAG 16.00 16.40-16.60 17.00
Crude Oil 74.00-75.00 75.50 76.20
EURO/USD 1.1660 1.1700 1.1820-1.1900
GBP/USD 1.3200 1.3260-1.3310 1.3390
USD/JPY 111.00 111.40-112.00 112.70

Intraday SUPPORTS LEVELS
3rd July 2018 S1 S2 S3
GOLD-XAU 1,240-1,236 1,220 1,214
Silver-XAG 15.60-15.30 14.80 14.10
Crude Oil 73.20-72.50 71.90 70.70-69.60
EURO/USD 1.1600 1.1500-1.1450 1.1365
GBP/USD 1.3145-1.3100 1.3050 1.2990-1.2920
USD/JPY 110.50-109.80 109.00 108.50-107.60

Intra-Day Strategy (3rd July 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 Monday made its intraday high of US$1254.07/oz and low of US$1241.79/oz. Gold was down by 0.776% at US$1241.79/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 1251-1271 keeping stop loss closing above 1290 and targeting 1240-1236 and 1220-1214. Buy above 1240-1214 with risk below 1214, targeting 1251-1260-1265 and 1271-1278.

 
Intraday Support Levels
S1     1,240-1,236
S2     1,220
S3     1,214
Intraday Resistance Levels
R1     1,251
R2     1,260-1,265
R3     1,271

Technical Indicators

Name   Value Action
14DRSI  

24.000

Buy
20-DMA   1268.61 Sell
50-DMA  

1288.25

Sell
100-DMA   1299.58 Sell
200-DMA   1298.34 Sell
STOCH(5,3)   14.616 Sell
MACD(12,26,9)   -14.616 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$16.11/oz and low of US$15.75/oz. Silver settled down by 1.370% at US$15.83/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     15.60-15.30
S2     14.80
S3     14.10

Intraday  Resistance Levels
R1     16.00
R2     16.40-16.60
R3     17.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   36.537 Buy
20-DMA   16.33 Sell
50-DMA   16.45 Sell
100-DMA   16.53 Sell
200-DMA   16.65 Sell
STOCH(5,3)   24.447 Buy
MACD(12,26,9)   -0.1635 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$73.64/bbl, intraday low of US$72.13/bbl and settled up by 1.309% to close at US$73.47/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 74.00-76.20 with stop loss at 76.20; targeting 73.20-72.50-71.90 and 70.70-69.60. Buy above 73.20-69.60 with risk daily closing below 69.60 and targeting 74.00-75.00 and 75.50-76.20.

 
Intraday Support Levels
S1     73.20-72.50
S2     71.90
S3     70.70-69.60

Intraday Resistance Levels
R1     74.00-75.00
R2     75.50
R3     76.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   67.034 Sell
20-DMA   69.31 Buy
50-DMA   68.05 Buy
100-DMA   66.16 Buy
200-DMA   62.45 Buy
STOCH(5,3)   92.106 Buy
MACD(12,26,9)   1.432 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1590/EUR, high of US$1.1687/EUR and settled the day down by 0.248% to close at US$1.1638/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 1.1660-1.1700 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     1.1660
R2     1.1700
R3     1.1820-1.1900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.205 Buy
20-DMA   1.1661 Sell
50-DMA   1.1790 Sell
100-DMA   1.1909 Buy
200-DMA   1.1885 Buy
STOCH(5,3)   71.712 Buy
MACD(12,26,9)   -0.0046 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3094/GBP, high of US$1.3208/GBP and settled the day down by 0.273% to close at US$1.3140/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     1.3145-1.3100
S2     1.3050
S3     1.2990-1.2920

Intraday Resistance Levels
R1     1.3200
R2     1.3260-1.3310
R3     1.3390

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

40.145

Buy
20-DMA   1.3252 Buy
50-DMA   1.3420 Buy
100-DMA   1.3547 Buy
200-DMA   1.3514 Buy
STOCH(5,3)   40.006 Buy
MACD(12,26,9)   -0.0079 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY110.75/USD and made an intraday high of JPY110.94/USD and settled the day up by 0.271% at JPY110.75/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   63.820 Buy
20-DMA   110.27 Buy
50-DMA   109.71 Buy
100-DMA   109.40 Sell
200-DMA   109.71 Sell
STOCH(9,6)   90.787 Sell
MACD(12,26,9)   0.2905 Sell

AAFX TRADING
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