AAFX TRADING

Daily Market Lookup

  • Asian stocks were mostly lower on Tuesday, with a sharp decline in crude oil prices weighing on energy shares, while the dollar dipped ahead of Federal Reserve Chairman Jerome Powell's first U.S. congressional testimony. Chinese shares extended losses after dropping the previous day on soft economic data. The Shanghai Composite Index fell 1.1 percent, as did Hong Kong's Hang Seng. Crude prices slumped more than 4 percent on Monday, with Brent futures reaching a three-month low of $71.52 a barrel, as Libyan ports reopened and traders eyed potential supply increases by Russia and other producer Concerns over China's second-quarter economic growth also weighed on oil prices. The country's economy expanded at a slower pace as Beijing's efforts to contain debt hurt activity, while June factory output growth weakened to a two-year low. Powell will testify on the economy and monetary policy before the U.S. Senate Banking Committee on Tuesday, followed by an appearance on Wednesday at the House of Representatives Financial Services Committee. He is likely to reiterate the Fed's stance towards gradual monetary policy tightening, and market focus will be on his views on recent trade tensions. U.S. retail sales rose solidly in June as households boosted purchases of automobiles and a range of other goods, cementing expectations for robust economic growth in the 2Q.
  • Signs of a strengthening economy, together with a tightening labor market and firming inflation, likely will keep the Federal Reserve on track to continue raising interest rates this year. Fed Chairman Jerome Powell offered an upbeat assessment of the economy last Friday, telling lawmakers that “over the first half of this year, overall economic activity appears to have expanded at a solid pace.” The U.S. central bank raised interest rates in June for the second time this year and has forecast two more rate hikes by the end of 2018. The Commerce Department said on Monday retail sales increased 0.5 percent last month. Data for May was revised to show sales rising 1.3 percent, the largest since September 2017, instead of the previously reported 0.8 percent gain. Economists had forecast retail sales rising 0.5 percent in June. Retail sales in June gained 6.6 percent from a year ago. Excluding automobiles, gasoline, building materials and food services, retail sales were unchanged last month after an upwardly revised 0.8 percent increase in May. These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product and were previously reported to have risen 0.5 percent in May. Consumer spending, which accounts for more than two-thirds of U.S. economic activity, braked in the January-March period, growing at its slowest pace in nearly five years. In addition to the solid retail sales data, a sharp narrowing of the trade deficit in April and May has also bolstered expectations of a strong GDP reading for the second quarter. Second-quarter growth expectations were supported by another report from the Commerce Department on Monday showing business inventories increased 0.4 percent in May. Consumer sentiment dipped in early July and a survey by the New York Fed published on Monday showed a moderation in factory activity in New York state in July amid a pullback in new order growth and shipments. Firms were also less optimistic about business conditions over the next six months. The International Monetary Fund also warned on Monday that the trade wars threatened to derail the global economic recovery, adding that the United States was especially vulnerable to a slowdown in its exports.
  • Oil prices fell for a second day on Tuesday as worries about possible disruptions to supply eased and as investors focused on potential damage to global growth from the festering Sino-U.S. trade spat. China is still confident of hitting its economic growth target of around 6.5 percent this year despite views that it faces a bumpy second-half as a trade row with the United States intensifies, the state planning agency said on Tuesday. The remarks came a day after China reported slightly slower growth for the second quarter and the weakest expansion in factory activity in June in two years, suggesting a further softening in business conditions in coming months as trade pressures build. Meanwhile, an oil worker strike in Norway intensified on Monday when hundreds more walked out in a dispute over pay and pensions after employers failed to respond to union demands for a new offer. The strike, which began last Tuesday, has had a limited impact on Norway's oil production so far, but some drillers warned of possible contract cancellations if the dispute goes on for a month or more. While Libyan ports are reopening, output at the country's Sharara oilfield was expected to fall by at least 160K bpd after two workers were abducted by an unknown group, the National Oil Corporation said on Saturday. U.S. oil output from seven major shale formations is expected to rise by 143K bpd to a record 7.47 mn bpd in August, the U.S. Energy Information Administration said in a monthly report on Monday. Production is expected to climb in all seven formations, with the largest gain of 73,000 bpd seen in the Permian Basin of Texas and New Mexico. All shale regions except for Appalachia are at a high, according to the data.

 

 
Intraday RESISTANCE LEVELS
17th July 2018 R1 R2 R3
GOLD-XAU 1,251 1,260-1,265 1,271
Silver-XAG 16.40-16.60 17.00 17.35
Crude Oil 67.60-68.00 68.90 70.00
EURO/USD 1.1770 1.1820 1.1900-1.1950
GBP/USD 1.3300 1.3390 1.3450-1.3490
USD/JPY 112.70-113.50 114.00 114.90

Intraday SUPPORTS LEVELS
17th July 2018 S1 S2 S3
GOLD-XAU 1,240-1,236 1,220 1,214
Silver-XAG 15.60-15.30 14.80 14.50
Crude Oil 66.90-66.00 65.20 64.50
EURO/USD 1.1720-1.1660 1.1600 1.1500-1.1450
GBP/USD 1.3145 1.3145 1.3100-1.3050
USD/JPY 112.00-111.40 110.90 109.80-109.00

Intra-Day Strategy (17th 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$1245.47/oz and low of US$1238.25/oz. Gold up by 0.169% at US$1240.79/oz.

Technicals in Focus:

In daily charts, prices are below 50DMA (1284) and breakage above will call for 1296-1300. 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 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  

34.831

Buy
20-DMA   1259.30 Sell
50-DMA  

1278.49

Sell
100-DMA   1292.68 Sell
200-DMA   1294.86 Sell
STOCH(5,3)   10.840 Sell
MACD(12,26,9)   -11.191 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$15.72/oz and low of US$15.72/oz. Silver settled down by 0.126% at US$15.77/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 overbought 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     14.50

Intraday  Resistance Levels
R1     16.40-16.60
R2     17.00
R3     17.35

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.462 Buy
20-DMA   16.17 Sell
50-DMA   16.34 Sell
100-DMA   16.46 Sell
200-DMA   16.61 Sell
STOCH(5,3)   53.303 Buy
MACD(12,26,9)   -0.140 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$69.80/bbl, intraday low of US$68.85/bbl and settled up by 3.383% to close at US$67.10/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 70.00-72.50 with stop loss at 72.50; targeting 68.90-68.00-67.60 and 66.90-66.00. Buy above 70.00-72.50 with risk daily closing below 69.60 and targeting 71.90-72.50-73.20 and 74.00-75.00.

 
Intraday Support Levels
S1     66.90-66.00
S2     65.20
S3     64.50

Intraday Resistance Levels
R1     67.60-68.00
R2     68.90
R3     70.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.263 Sell
20-DMA   69.67 Buy
50-DMA   68.76 Buy
100-DMA   66.92 Buy
200-DMA   63.20 Buy
STOCH(5,3)   10.033 Sell
MACD(12,26,9)   0.160 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1674/EUR, high of US$1.1674/EUR and settled the day up by 0.179% to close at US$1.1710/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 1.1660-1.1450 with risk below 1.1400, targeting 1.1720-1.1800 and 1.1900-1.1950. Sell below 1.1720-1.1950 targeting 1.1660-1.1600 and 1.1490-1.1450 with stop-loss at daily closing above 1.2010.

 
Intraday Support Levels
S1     1.1720-1.1660
S2     1.1600
S3     1.1500-1.1450

Intraday  Resistance Levels
R1     1.1770
R2     1.1820
R3     1.1900-1.1950

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.646 Buy
20-DMA   1.1689 Sell
50-DMA   1.1758 Sell
100-DMA   1.1868 Buy
200-DMA   1.1866 Buy
STOCH(5,3)   61.340 Buy
MACD(12,26,9)   -0.0005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3101/GBP, high of US$1.3238/GBP and settled the day down by 0.0226% to close at US$1.3234/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 1.3300-1.3500 with targets at 1.3200-1.3145 and 1.3100-1.3060. Buy above 1.3200-1.2920 with targets 1.3310-1.3360 and 1.3450-1.3500 with stop loss closing below 1.2920.

 
Intraday Support Levels
S1     1.3145
S2     1.3145
S3     1.3100-1.3050

Intraday Resistance Levels
R1     1.3300
R2     1.3390
R3     1.3450-1.3490

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

48.537

Buy
20-DMA   1.3239 Buy
50-DMA   1.3358 Buy
100-DMA   1.3489 Buy
200-DMA   1.3487 Buy
STOCH(5,3)   46.857 Buy
MACD(12,26,9)   -0.0029 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY112.27/USD and made an intraday high of JPY112.79/USD and settled the day down by 0.115% at JPY112.38/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 112.70-114.90 with risk above 114.90 targeting 112.70-111.40-110.90 and 110.90-109.80-109.00. Long positions above 109.80-109.00 with targets of 109.80-110.50-111.00 and 111.50-112.00 with stop below 107.00.

 
Intraday Support Levels
S1     112.00-111.40
S2     110.90
S3     109.80-109.00

INTRADAY RESISTANCE LEVELS
R1     112.70-113.50
R2     114.00
R3     114.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   71.101 Buy
20-DMA   110.04 Buy
50-DMA   110.23 Buy
100-DMA   109.73 Sell
200-DMA   109.86 Sell
STOCH(9,6)   86.675 Sell
MACD(12,26,9)   0.593 Sell

AAFX TRADING
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