AAFX TRADING

Daily Market Lookup

  • Asian stocks fell for the fourth day and major currencies traded in tight ranges on Thursday, with financial markets jittery before a U.S. deadline to impose tariffs on Chinese imports just a day away. The United States plans to implement tariffs on $50 billion worth of imports from China as both nations remained locked in a bitter trade dispute that has convulsed global financial markets in recent weeks. On July 6, tariffs on $34 billion worth of imports will take effect, and Beijing has promised to retaliate in kind. However, China’s finance ministry did say on Wednesday that it will “absolutely not” fire the first shot in a trade war with the United States and will not be the first to levy tariffs. China has put pressure on the European Union to issue a strong joint statement against U.S. President Donald Trump’s trade policies, European officials told Reuters.. The Chinese yuan was slightly lower, its recovery from an 11-month low stalling. A rebound in the yuan was triggered in the past two sessions after the central bank sought to calm nervous markets midweek and stem the currency’s recent tumble. The longer term direction for the yuan was still unclear. China appears broadly comfortable with a weakening yuan and would intervene only to prevent any destabilizing declines or to restore market confidence, policy insiders told Reuters.
  • German industrial orders bounced back in May with a stronger-than-expected jump after four consecutive monthly drops, data showed on Thursday, as demand from domestic customers and the rest of the euro zone picked up. The Federal Statistics Office said orders rose 2.6 percent after an upwardly revised drop of 1.6 percent the previous month. The latest reading beat a Reuters poll of analysts, who had predicted a 1.1 percent rise. The Economy Ministry said industrial output was likely to rise moderately in coming months. The rise in May was mainly driven by demand from other euro zone countries and domestic clients. A breakdown of the figures showed that orders for capital goods and consumer goods jumped the most. The ministry said the four monthly drops from January to April were a consequence of a strong jump in orders in the second half of 2017. The International Monetary Fund on Thursday cut its 2018 forecast for German GDP growth to 2.2 percent, saying rising protectionism and the threat of a hard Brexit had exposed Europe’s biggest economy to significant short-term risks. The dollar edged up on Thursday as market players prepare for a potential full-scale Sino-U.S. trade war.  On Friday, the U.S. is scheduled to impose tariffs on $34 billion of Chinese goods. Beijing has said earlier it would slap tariffs on an equal value on U.S. exports including agricultural and auto exports. The perception of the relative strength of the U.S. economic growth and the attraction of its higher bond yields were also cited as supporting the dollar. Yi Gang, governor of the People’s Bank of China, said in a statement on Tuesday that the central bank would closely monitor fluctuation in the forex market and would take action to keep the yuan at a stable and reasonable level. The outcome of a two-day U.S. Federal Reserve policy meeting is scheduled to be announced at 2PM ET (18:00 GMT). The central bank had projected in June two more rate hikes in 2018 for a total of four.
  • Oil prices fell on Thursday after U.S. President Donald Trump sent a strident tweet demanding that OPEC cut prices for crude. The escalating trade row between Washington and Beijing, which triggered another sell-off in Asian stocks on Thursday, was also felt in oil markets, with China warning it could introduce duties on U.S. crude imports at an as yet unspecified date. Trump on Wednesday accused the OPEC of driving up fuel prices. OPEC together with a group of non-OPEC producers led by Russia started to withhold output in 2017 to prop up prices. Recent price rises have also been spurred by a U.S. announcement that it plans to re-introduce sanctions against Iran from November, targeting oil exports. OPEC and Russia announced in June they were willing to raise output to address concerns of emerging supply shortages due to unplanned disruptions from Venezuela to Libya, and likely also to replace a potential fall in Iranian supplies due to U.S. sanctions. The U.S. bank warned that supply threats were "threatening a sharp further rise in prices and global economic growth". Meanwhile, China's commerce ministry said on Thursday the United States is "opening fire on the entire world", warning that Washington's proposed tariffs on Chinese goods will hit international supply chains The comments came as Washington plans to impose tariffs on an estimated $34 billion worth of Chinese imports on Friday. Asian stock markets on Thursday extended recent sharp losses. However, the Chinese government has not yet specified a date on which it may introduce duties on imports of U.S. crude. The latter have soared in the last two years to around 400,000 barrels per day in July, worth around $1 billion at current market prices. If introduced, an import duty of 25 percent would make U.S. crude uncompetitive in China, forcing its refiners to seek alternative supplies.

 

 
Intraday RESISTANCE LEVELS
5th July 2018 R1 R2 R3
GOLD-XAU 1,260-1,265 1,271 1,278
Silver-XAG 16.40-16.60 17.00 17.35
Crude Oil 72.50-73.20 74.00 75.00-75.50
EURO/USD 1.1720 1.1820-1.1900 1.1950
GBP/USD 1.3200 1.3260-1.3310 1.3390
USD/JPY 111.00 111.40-112.00 112.70

Intraday SUPPORTS LEVELS
5th July 2018 S1 S2 S3
GOLD-XAU 1,251 1,240-1,236 1,220
Silver-XAG 16.00 15.60-15.30 14.80
Crude Oil 71.90 70.70-69.60 69.00
EURO/USD 1.1660-1.1600 1.1500 1.1450-1.1365
GBP/USD 1.3145-1.3100 1.3050 1.2990-1.2920
USD/JPY 109.80 109.00 108.50-107.60

Intra-Day Strategy (5th 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 Wednesday made its intraday high of US$1261.00/oz and low of US$1251.95/oz. Gold was up by 0.345% at US$1256.75/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     1,251
S2     1,240-1,236
S3     1,220
Intraday Resistance Levels
R1     1,260-1,265
R2     1,271
R3     1,278

Technical Indicators

Name   Value Action
14DRSI  

25.933

Buy
20-DMA   1272.16 Sell
50-DMA  

1290.45

Sell
100-DMA   1300.90 Sell
200-DMA   1298.98 Sell
STOCH(5,3)   18.534 Sell
MACD(12,26,9)   -13.407 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$16.13/oz and low of US$15.98/oz. Silver settled up by 0.4377% at US$16.06/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     17.35

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.402 Buy
20-DMA   16.27 Sell
50-DMA   16.42 Sell
100-DMA   16.51 Sell
200-DMA   16.64 Sell
STOCH(5,3)   44.693 Buy
MACD(12,26,9)   -0.1505 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$73.15/bbl, intraday low of US$72.15/bbl and settled up by % to close at US$72.86/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 72.50-76.20 with stop loss at 76.20; targeting 73.20-72.50-71.90 and 70.70-69.60. Buy above 71.90-69.00 with risk daily closing below 69.60 and targeting 72.50-73.20-74.00 and 75.00-76.20.

 
Intraday Support Levels
S1     71.90
S2     70.70-69.60
S3     69.00

Intraday Resistance Levels
R1     72.50-73.20
R2     74.00
R3     75.00-75.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.388 Sell
20-DMA   69.54 Buy
50-DMA   68.03 Buy
100-DMA   66.15 Buy
200-DMA   62.44 Buy
STOCH(5,3)   86.932 Sell
MACD(12,26,9)   1.380 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1629/EUR, high of US$1.1681/EUR and settled the day down by 0.0171% to close at US$1.1654/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 1.1660-1.1300 with risk below 1.1300 targeting 1.1720-1.1800 and 1.1900-1.1950. Sell below 1.1720-1.1950 targeting 1.1660-1.1600-1.1490 and 1.1450-1.1370 with stop-loss at daily closing above 1.1950.

 
Intraday Support Levels
S1     1.1660-1.1600
S2     1.1500
S3     1.1450-1.1365

Intraday  Resistance Levels
R1     1.1720
R2     1.1820-1.1900
R3     1.1950

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.795 Buy
20-DMA   1.1663 Sell
50-DMA   1.1776 Sell
100-DMA   1.1895 Buy
200-DMA   1.1878 Buy
STOCH(5,3)   82.770 Buy
MACD(12,26,9)   -0.0030 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.3169/GBP, high of US$1.3249/GBP and settled the day up by 0.272% to close at US$1.3223/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 Wednesday made intra‐day low of JPY110.27/USD and made an intraday high of JPY110.58/USD and settled the day down by 0.072% at JPY110.45/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 111.00-112.70 with risk above 112.70 targeting 109.00-108.40 and 107.60-107.00. Long positions above 109.80-107.60 with targets of 109.80-110.50-111.00 and 111.50-112.00 with stop below 107.00.

 
Intraday Support Levels
S1     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   54.504 Buy
20-DMA   110.24 Buy
50-DMA   109.71 Buy
100-DMA   109.41 Sell
200-DMA   109.72 Sell
STOCH(9,6)   66.457 Sell
MACD(12,26,9)   0.237 Sell

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