AAFX TRADING

Daily Market Lookup

  • Asian stocks inched up on Friday following a tech-led rise on Wall Street, although the latest exchange of trade threats between Beijing and Washington capped gains and drove safe-haven flows to the dollar, which hovered near a two-week high. Investors also remain cautious ahead of the July U.S. jobs report due later on Friday, which will give a reading on the health of the world's largest economy and possible clues about the pace of Federal Reserve interest rate rises. The trade war between the world's top two economies intensified midweek after U.S. President Donald Trump raised pressure on China by proposing a higher 25 percent tariff on $200 billion worth of Chinese imports. Trade tensions were seen driving demand for the U.S. currency, with a slide by the pound providing an extra lift Sterling dropped more than 0.8 percent on Thursday despite the Bank of England lifting interest rates, after Governor Mark Carney said monetary policy needed to "walk not run" and expressed concern about the risks of a cliff-edge Brexit. Bubbling concerns over Italy weighed on the euro, with the country's bond yields rising to two-month highs following media reports of a government meeting on the budget revived market concerns about tensions within the ruling coalition. The dollar received a big boost against the yen earlier this week after the Bank of Japan tweaked its monetary policy but retained its commitment to keeping interest rates low.
  • The dollar firmed against a basket of currencies on Friday and hit a more than 14-month high against the yuan, with markets gripped by worries over escalating trade tensions between the United States and China. China vowed on Thursday to retaliate if the U.S. acted on a threat to raise tariffs on the Asian nation's exports, after U.S. President Donald Trump instructed his trade officials to look at increasing tariffs to 25 percent from 10 percent on $200 billion in Chinese imports into the United States. But, as the United States imports far more from China, than China does from the United States, investors see a trade war causing greater pain for the Chinese economy. Elsewhere, the pound remained frail even after the Bank of England on Thursday raised its policy interest rate from 0.5 to 0.75 percent following an unanimous decision of its nine-member policy board. Bank of England Governor Mark Carney said monetary policy needed to "walk not run" while expressing worries about the risks of a cliff-edged Brexit. A cliff-edged Brexit could lead to higher tariffs and other strict rules on the border, which will hurt the U.K. economy, said Mizuho Securities' Yamamoto.
  • U.S. companies likely maintained a strong pace of hiring in July, suggesting that the robust economy was helping the labor market to weather trade tensions, which could allow the Federal Reserve to raise interest rates again in September. Nonfarm payrolls probably rose by 190,000 jobs last month after increasing 213,000 in June, according to a Reuters survey of economists. The Labor Department will publish its closely watched employment report on Friday at 8:30 a.m.(1230 GMT). There have also been concerns that the trade tensions could dampen business confidence and lead companies to shelve spending and hiring plans. But a $1.5 trillion fiscal stimulus, which helped to power the economy to a 4.1 percent annualized growth pace in the second quarter, is assisting the United States in navigating the stormy trade waters. The economy needs to create about 120,000 jobs per month to keep up with growth in the working-age population. Job growth averaged 215,000 per month in the first half of this year. The unemployment rate is forecast falling one-tenth of a percentage point to 3.9 percent in July. It rose in June from an 18-year low of 3.8 percent in May as job seekers piled into the labor market, likely confident of their employment prospects.
  • Oil prices were mixed on Friday after strong gains in the previous session on reports that crude supplies fell at a domestic delivery hub at Cushing, Oklahoma. Higher output from the OPEC and Russia were cited as headwind for oil prices, as OPEC’s July output climbed and Saudi Arabia pumped near-record volumes, while Russia also boosted production. On Thursday, Information provider Genscape reportedly said U.S. crude inventories at Cushing had fallen in the week, according to traders. Stockpiles at the hub fell by 1.1 million barrels since Friday, July 27. Trade war between the U.S. and China also remained in focus, as traders fear China would lower energy demand following recent development and drive crude prices lower. U.S. Commerce Secretary Wilbur Ross urged on Friday to inflict more pain to China unless it changes its economic system.

 

 
Intraday RESISTANCE LEVELS
3rd August 2018 R1 R2 R3
GOLD-XAU 1,214-1,220 1,228 1,236-1,240
Silver-XAG 15.50 16.40-16.60 17.00
Crude Oil 68.20-69.00 69.50 70.20
EURO/USD 1.1660-1.1720 1.1770 1.1820-1.1900
GBP/USD 1.3040-1.3090 1.3145 1.3200-1.3300
USD/JPY 112.10 112.70-113.50 114.20

Intraday SUPPORTS LEVELS
3rd August 2018 S1 S2 S3
GOLD-XAU 1,202 1,194 1,189-1,180
Silver-XAG 15.10-14.80 14.50 13.90
Crude Oil 67.60 67.00-66.50 65.40
EURO/USD 1.1570 1.1510 1.1450-1.1400
GBP/USD 1.3000-1.2965 1.2900 1.2840
USD/JPY 111.40 111.00 110.60-109.80

Intra-Day Strategy (3rd August 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$1221.04/oz and low of US$1207.66/oz. Gold down by 0.672% at US$1207.66/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 1214-1240 keeping stop loss closing above 1240 and targeting 1203-1194 and 1189-1180. Buy above 1204-1180 with risk below 1180, targeting 1214-1220 and 1236-1240-1251.

 
Intraday Support Levels
S1     1,202
S2     1,194
S3     1,189-1,180
Intraday Resistance Levels
R1     1,214-1,220
R2     1,228
R3     1,236-1,240

Technical Indicators

Name   Value Action
14DRSI  

27.166

Buy
20-DMA   1229.04 Sell
50-DMA  

1253.03

Sell
100-DMA   1274.68 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 Thursday made its intraday high of US$15.46/oz and low of US$15.27/oz. Silver settled down by 0.455% at US$15.27/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 15.10-13.90 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     15.10-14.80
S2     14.50
S3     13.90

Intraday  Resistance Levels
R1     15.50
R2     16.40-16.60
R3     17.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.911 Buy
20-DMA   15.57 Sell
50-DMA   15.91 Sell
100-DMA   16.18 Sell
200-DMA   16.43 Sell
STOCH(5,3)   9.528 Buy
MACD(12,26,9)   -0.209 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$68.62/bbl, intraday low of US$66.30/bbl and settled up by 1.608% to close at US$68.22/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 68.20-71.00 with stop loss at 71.00; targeting 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     67.60
S2     67.00-66.50
S3     65.40

Intraday Resistance Levels
R1     68.20-69.00
R2     69.50
R3     70.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.927 Sell
20-DMA   68.63 Buy
50-DMA   68.55 Buy
100-DMA   67.22 Buy
200-DMA   63.81 Buy
STOCH(5,3)   40.109 Sell
MACD(12,26,9)   -0.314 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1656/EUR, high of US$1.1666/EUR and settled the day down by 0.634% to close at US$1.1584/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 1.1570-1.1400 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     1.1570
S2     1.1510
S3     1.1450-1.1400

Intraday  Resistance Levels
R1     1.1660-1.1720
R2     1.1770
R3     1.1820-1.1900

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.620 Buy
20-DMA   1.1662 Sell
50-DMA   1.1717 Sell
100-DMA   1.1819 Sell
200-DMA   1.1840 Sell
STOCH(5,3)   10.530 Buy
MACD(12,26,9)   -0.0017 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3013/GBP, high of US$1.3127/GBP and settled the day down by 0.822% to close at US$1.3157/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 1.3040-1.3360 with targets at 1.3000-1.2950 and 1.2900-1.2840. Buy above 1.3000-1.2840 with targets 1.3040-1.3090 and 1.3145-1.3200-1.3310 with stop loss closing below 1.2800.

 
Intraday Support Levels
S1     1.3000-1.2965
S2     1.2900
S3     1.2840

Intraday Resistance Levels
R1     1.3040-1.3090
R2     1.3145
R3     1.3200-1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

37.105

Buy
20-DMA   1.3127 Buy
50-DMA   1.3245 Buy
100-DMA   1.3393 Buy
200-DMA   1.3436 Buy
STOCH(5,3)   10.972 Buy
MACD(12,26,9)   -0.0049 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY111.31/USD and made an intraday high of JPY111.72/USD and settled the day down by 0.062% at JPY111.64/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 buy as it has given positive crossover to confirm bullish stance.

Trading Strategy: Neutral to Sell

Sell below 112.00-114.20 with risk above 114.20 targeting 111.40-111.00-110.60 and 109.80-109.00. Long positions above 111.40-109.820 with targets of 111.40-112.00 and 113.50-114.00-114.90 with stop below 107.00.

 
Intraday Support Levels
S1     111.40
S2     111.00
S3     110.60-109.80

INTRADAY RESISTANCE LEVELS
R1     112.10
R2     112.70-113.50
R3     114.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.661 Buy
20-DMA   111.42 Buy
50-DMA   110.76 Buy
100-DMA   110.14 Buy
200-DMA   110.06 Buy
STOCH(9,6)   83.377 Buy
MACD(12,26,9)   0.239 Sell

AAFX TRADING
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