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Daily Market Lookup

  • The U.S. dollar rose against the yen on Tuesday after the Bank of Japan made small tweaks to policy rather than more drastic changes that some traders in the market had anticipated, before paring those gains. The dollar reached a one-week high of 111.44 yen , rising about 0.3 percent shortly after the BOJ made changes to make its massive stimulus program more flexible after a two-day policy board meeting. The BOJ's policy changes, its first since 2016, reflected its forecast that it would take time for inflation to hit its 2 percent target. The central bank said long-term interest rates may fluctuate depending on economic and price developments and that it would conduct its bond-buying program flexibly. It maintained the short-term interest rate target at minus 0.1% and a pledge to guide 10-year government bond yields around zero percent by a 7-2 vote. The Japanese yen traded slightly higher against its U.S. counterpart ahead of the highly anticipated policy decision from the BOJ due later in the day. All eyes would be on the BOJ rate decision and outlook report due later today as earlier reports suggested that the central bank might adjust its stimulus program. More specifically, analysts believed the BOJ could be trimming its 80 trillion yen quantities easing program or tweaking yield curve control tolerance thresholds. Any winding back of stimulus could push the Japanese yen higher and undermine efforts to boost domestic inflation that is well below the central bank’s 2% target, analysts said. Looking ahead, the Japanese currency could also potentially be impacted by other economic events coming up this week, including monetary policy announcement due from the U.S. Federal Reserve and the Bank of England.
  • Gold prices edged lower while the dollar was little changed on Monday as market participants awaited key central bank meetings due later this week. The dollar remained unchanged on Monday ahead of several key central bank meetings coming up this week.  The U.S. Federal Reserve concludes its policy meeting on Wednesday and is widely expected to reaffirm the outlook for further gradual rate rises, as the market is almost fully priced for a rate hike in September and expects a further move before the end of this year. U.S. second-quarter GDP grew at 4.1%, marking the quickest pace of growth since 2014, although its impact on the dollar and gold prices seemed to be limited. Analysts questioned the sustainability of growth, however, as the benefits from fiscal stimulus on economic growth are expected to wane next year.
  • FED is expected to keep interest rates unchanged on Wednesday but solid economic growth combined with rising inflation are likely keep it on track for another two hikes this year even as President Donald Trump has ramped up criticism of its push to raise rates. The U.S. central bank so far this year has increased borrowing costs in March and June, and investors see additional moves in September and December. Policymakers have raised rates seven times since December 2015. The Fed will announce its decision on Wednesday at 2 p.m. EDT (1800 GMT). No press conference is scheduled and only minor changes are anticipated compared with the Fed’s June policy statement, which emphasized accelerating economic growth, strong business investment and rising inflation. The U.S. economy grew at its fastest pace in nearly four years in the second quarter as consumers boosted spending and farmers rushed shipments of soybeans to China to beat retaliatory trade tariffs, Commerce Department data showed on Friday. The Fed’s preferred measure of inflation increased at a 2.0% pace in the second quarter, the data also showed. Economists expect data later on Tuesday to show prices in June were 2.0% higher than a year earlier, matching the gain in May. That would mean two straight months that inflation has hit the Fed’s 2% target rate after undershooting it for six years. The unemployment rate stands at 4.0%, lower than the level seen sustainable by Fed policymakers.
  • Oil prices edged lower on Tuesday as OPEC production reached a fresh 2018 high in the month of July, reports revealed. OPEC hiked production by 70,000 barrels per day to 32.64 million bpd, a 2018 high, Reuters reported. Further supply increases could offset production outages and pressure prices, it added. Oil prices received some support on Monday as investor concerns over global crude supply supported sentiment, as investors continued to weigh supply disruptions in Saudi Arabia and declining output from and Venezuela, Iran and Libya. Saudi Arabia announced it would suspend shipments of oil through the key Bab el-Mandeb Strait, after Houthi rebels in Yemen attacked a pair of oil tankers in the Red Sea. Combined flows from Iran, Libya and Venezuela fell to their lowest since January, JBC Energy said. Dollar-denominated commodities such as oil are sensitive to moves in the dollar.

 

 
Intraday RESISTANCE LEVELS
31st July 2018 R1 R2 R3
GOLD-XAU 1,236-1,240 1,248 1,255-1,260
Silver-XAG 15.60 16.40-16.60 17.00
Crude Oil 69.50 70.20 71.00-71.60
EURO/USD 1.1720 1.1770 1.1820-1.1900
GBP/USD 1.3145 1.3200-1.3300 1.3360
USD/JPY 111.40 112.00 112.70-113.50

Intraday SUPPORTS LEVELS
31st July 2018 S1 S2 S3
GOLD-XAU 1,220-1,214 1,202 1,194
Silver-XAG 15.30-14.80 14.50 13.90
Crude Oil 69.00-68.20 67.60 67.00-66.50
EURO/USD 1.1660-1.1600 1.1500 1.1450-1.1400
GBP/USD 1.3090 1.3040 1.3000-1.2950
USD/JPY 111.00 110.60-109.80 109.20

Intra-Day Strategy (31st 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$1225.00/oz and low of US$1218.93/oz. Gold down by 0.065% at US$1221.98/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 1236-1265 keeping stop loss closing above 1265 and targeting 1220-1213 and 1203-1194. Buy above 1220-1194 with risk below 1194, targeting 1236-1240-1251 and 1260-1265.

 
Intraday Support Levels
S1     1,220-1,214
S2     1,202
S3     1,194
Intraday Resistance Levels
R1     1,236-1,240
R2     1,248
R3     1,255-1,260

Technical Indicators

Name   Value Action
14DRSI  

33.671

Buy
20-DMA   1235.51 Sell
50-DMA  

1258.42

Sell
100-DMA   1278.46 Sell
200-DMA   1288.41 Sell
STOCH(5,3)   26.026 Sell
MACD(12,26,9)   -12.248 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$15.52/oz and low of US$15.38/oz. Silver settled up by 0.129% at US$15.47/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 15.30-13.90 targeting 15.60-16.35-17.00 and 17.75-18.20; stop breakage below 15.00. Sell below 15.60-17.00 with stop loss above 17.00; targeting 15.30-14.80 and 14.50-13.90.

 
Intraday  Support Levels
S1     15.30-14.80
S2     14.50
S3     13.90

Intraday  Resistance Levels
R1     15.60
R2     16.40-16.60
R3     17.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.354 Buy
20-DMA   15.75 Sell
50-DMA   16.04 Sell
100-DMA   16.30 Sell
200-DMA   16.51 Sell
STOCH(5,3)   58.317 Buy
MACD(12,26,9)   -0.2315 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$68.90/bbl, intraday low of US$68.36/bbl and settled up by 1.414% to close at US$69.53/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 68.90-71.00 with stop loss at 71.00; targeting 68.10-67.60-67.00 and 66.50-66.00. Buy above 68.10-66.00 with risk daily closing below 66.00 and targeting 68.90-69.50 and 70.20-71.00.

 
Intraday Support Levels
S1     69.00-68.20
S2     67.60
S3     67.00-66.50

Intraday Resistance Levels
R1     69.50
R2     70.20
R3     71.00-71.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.343 Sell
20-DMA   69.02 Buy
50-DMA   68.69 Buy
100-DMA   67.21 Buy
200-DMA   63.71 Buy
STOCH(5,3)   72.780 Sell
MACD(12,26,9)   -0.096 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1647/EUR, high of US$1.1718/EUR and settled the day up by 0.420% to close at US$1.1704/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 1.1660-1.1400 with risk below 1.1400, targeting 1.1660-1.1750-1.1820 and 1.1900-1.1960. Sell below 1.1660-1.1900 targeting 1.1600-1.1500 and 1.1450-1.1400 with stop-loss at daily closing above 1.1960.

 
Intraday Support Levels
S1     1.1660-1.1600
S2     1.1500
S3     1.1450-1.1400

Intraday  Resistance Levels
R1     1.1720
R2     1.1770
R3     1.1820-1.1900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.803 Buy
20-DMA   1.1684 Sell
50-DMA   1.1731 Sell
100-DMA   1.1833 Sell
200-DMA   1.1847 Sell
STOCH(5,3)   57.902 Buy
MACD(12,26,9)   -0.0006 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3096/GBP, high of US$1.3151/GBP and settled the day up by 0175% to close at US$1.3131/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

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.

 
Intraday Support Levels
S1     1.3090
S2     1.3040
S3     1.3000-1.2950

Intraday Resistance Levels
R1     1.3145
R2     1.3200-1.3300
R3     1.3360

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

49.447

Buy
20-DMA   1.3177 Buy
50-DMA   1.3293 Buy
100-DMA   1.3434 Buy
200-DMA   1.3459 Buy
STOCH(5,3)   93.025 Buy
MACD(12,26,9)   -0.0037 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.88/USD and made an intraday high of JPY111.16/USD and settled the day up by 0.009% at JPY111.04/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 110.90-113.50 with risk above 113.50 targeting 110.60-109.80 and 109.00. Long positions above 110.90-109.820 with targets of 111.40-112.00 and 113.50-114.00-114.90 with stop below 107.00.

 
Intraday Support Levels
S1     111.00
S2     110.60-109.80
S3     109.20

INTRADAY RESISTANCE LEVELS
R1     111.40
R2     112.00
R3     112.70-113.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.408 Buy
20-DMA   111.29 Buy
50-DMA   110.68 Buy
100-DMA   110.09 Sell
200-DMA   110.03 Sell
STOCH(9,6)   53.19 Sell
MACD(12,26,9)   0.154 Sell

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