AAFX TRADING

Daily Market Lookup

  • Asian stocks rose on Tuesday, supported by hopes Beijing and Washington would dial back trade hostilities, though comments from the U.S. president about the yuan and Federal Reserve policy capped gains and weighed on the dollar. In an interview with Reuters on Monday, President Donald Trump said that China was manipulating its currency to make up for having to pay tariffs imposed by Washington on some imports from China. This kept global trade conflict concerns alive and dented some of the market optimism ahead of upcoming U.S.-China trade talks. Wall Street's major indexes rose on Monday on optimism over trade talks between the United States and China, though they fell from session highs after Trump's comments. Immediate focus was on the lower-level trade talks due to start this week between the United States and China. Speculation that the talks might help ease trade tensions has shored up the broader equity markets over the past few sessions. Market optimism was tested, however, after Trump said he did not "anticipate much" from the discussions. In currency markets, the dollar came under pressure after Trump reiterated his displeasure at the Fed's rate hikes, saying the central bank should do more to help him boost the U.S. economy.
  • U.S. President Donald Trump said on Monday he was “not thrilled” with the Federal Reserve under his own appointee, Chairman Jerome Powell, for raising interest rates and said the U.S. central bank should do more to help him to boost the economy. U.S. President Donald Trump answers a question during an interview with Reuters in the Oval Office of the White House in Washington. In the middle of international trade disputes, Trump in an interview with Reuters also accused China and Europe of manipulating their respective currencies. American presidents have rarely criticized the Fed in recent decades because its independence has been seen as important for economic stability. Trump has departed from this past practice and said he would not shy from future criticism should the Fed keep lifting rates. The president spooked investors in July when he criticized the U.S. central bank’s over tightening monetary policy. On Monday he said the Fed should be more accommodating on interest rates. U.S. stock prices dipped after Trump’s comments to Reuters and the U.S. dollar .DXY edged down against a basket of currencies. Trump, who criticized the Fed when he was a candidate, said other countries benefited from their central banks’ moves during tough trade talks, but the United States was not getting support from the Fed. The Fed has raised interest rates twice this year and is expected to do so again next month with consumer price inflation rising to 2.9 percent in July, its highest level in six years, and unemployment at 3.9 percent, the lowest level in about 20 years. After leaving its policy interest rates at historic lows for about six years after the 2008 global financial crisis, the Fed began slowly raising rates again in late 2015. Trump has frequently accused China of manipulating its currency, but his administration has so far declined to name China formally as a currency manipulator in a semi-annual report from the U.S. Treasury Department. The U.S. dollar has strengthened this year by 5.35 percent against the yuan, reversing most of its large drop against the Chinese currency in 2017.
  • Oil prices held firm on Tuesday, with U.S. fuel markets seen to be tightening, although the release of crude from the American strategic reserve somewhat offset an expected supply cut due to upcoming sanctions against Iran. Traders said U.S. markets were lifted by a tightening outlook for fuel markets in the coming months. Inventories in the United States for refined products such as diesel and heating oil for this time of year are at their lowest in four years. This is occurring just ahead of the peak demand period for these fuels, with diesel needed for tractors to harvest crops and the arrival of colder weather during the Northern Hemisphere autumn raising consumption of heating oil. Outside the United States, markets focused on U.S. sanctions against Iran, which from November will target its oil sector. Washington on Monday offered 11 million barrels of high-sulfur, or sour, crude from its Strategic Petroleum Reserve =for delivery from Oct. 1 to Nov. 30. The released oil could offset expected supply shortfalls from U.S. sanctions against Iran. Because of the sanctions, French bank BNP Paribas (PA:BNPP) said it expected oil production from the Organization of the Petroleum Exporting Countries (OPEC), of which Iran is a member, to fall from an average of 32.1 million barrels per day (bpd) in 2018 to 31.7 million bpd in 2019. Still, traders said overall market sentiment was cautious because of concerns over the demand outlook amid the trade dispute between the United States and China. A Chinese trade delegation is due in Washington this week to resolve the dispute, but U.S. President Donald Trump told Reuters in an interview on Monday he does not expect much progress, and that resolving the trade dispute with China will "take time". While most of Europe's energy firms will likely fall in line with Washington, China has indicated that it will continue to buy Iranian oil. The Iran supply cut may also be more than compensated for by production increases outside OPEC.

 

 
Intraday RESISTANCE LEVELS
21st August 2018 R1 R2 R3
GOLD-XAU 1,196 1,207-1,214 1,220
Silver-XAG 14.80-15.10 15.50 16.40-16.60
Crude Oil 65.70 66.50 67.00-67.60
EURO/USD 1.1540-1.1610 1.1660 1.1720
GBP/USD 1.2840 1.2900 1.2950-1.2990
USD/JPY 110.70 111.40-112.00 112.50

Intraday SUPPORTS LEVELS
21st August 2018 S1 S2 S3
GOLD-XAU 1,189-1,180 1,172 1,166-1,160
Silver-XAG 14.50-13.90 13.50 13.00
Crude Oil 65.00 64.00-63.30 62.80
EURO/USD 1.1510-1.1450 1.1400 1.1320-1.1250
GBP/USD 1.2750 1.2700-1.2660 1.2580
USD/JPY 110.20-109.80 109.40 109.00

Intra-Day Strategy (21st 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 Monday made its intraday high of US$1190.78/oz and low of US$1182.71/oz. Gold up by 0.597% at US$1190.36/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 neutral 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 1196-1220 keeping stop loss closing above 1220 and targeting 1189-1180-1172 and 1166-1160. Buy above 1189-1160 with risk below 1160, targeting 1196-1207 and1214-1220.

 
Intraday Support Levels
S1     1,189-1,180
S2     1,172
S3     1,166-1,160
Intraday Resistance Levels
R1     1,196
R2     1,207-1,214
R3     1,220

Technical Indicators

Name   Value Action
14DRSI  

38.994

Buy
20-DMA   1205.96 Sell
50-DMA  

1234.78

Sell
100-DMA   1274.39 Sell
200-DMA   1292.40 Sell
STOCH(5,3)   69.735 Buy
MACD(12,26,9)   -14.377 Buy

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$14.83/oz and low of US$14.63/oz. Silver settled up by 0.006% at US$14.73/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 14.50-13.00 targeting 14.90-15.10-15.60 and 16.35-16.60; stop breakage below 13.00. Sell below 14.80-17.00 with stop loss above 17.00; targeting 14.50-13.90 and 13.50-13.30.

 
Intraday  Support Levels
S1     14.50-13.90
S2     13.50
S3     13.00

Intraday  Resistance Levels
R1     14.80-15.10
R2     15.50
R3     16.40-16.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.875 Buy
20-DMA   15.24 Sell
50-DMA   15.65 Sell
100-DMA   16.03 Sell
200-DMA   16.32 Sell
STOCH(5,3)   13.42 Buy
MACD(12,26,9)   -0.281 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$65.56/bbl, intraday low of US$64.80/bbl and settled up by 0.353% to close at US$65.37/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 65.70-67.60 with stop loss at 67.60; targeting 65.00-63.95-63.30 and 62.80-61.50. Buy above 65.00-62.00 with risk daily closing below 62.00 and targeting 65.70-66.50 and 67.00-67.60.

 
Intraday Support Levels
S1     65.00
S2     64.00-63.30
S3     62.80

Intraday Resistance Levels
R1     65.70
R2     66.50
R3     67.00-67.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.377 Sell
20-DMA   67.22 Buy
50-DMA   68.30 Buy
100-DMA   68.07 Buy
200-DMA   64.07 Buy
STOCH(5,3)   31.728 Sell
MACD(12,26,9)   -0.989 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1393/EUR, high of US$1.1484/EUR and settled the day up by 0.384% to close at US$1.1480/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 oversold territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently approaching oversold region and giving wards directions to consider sell.

Trading Strategy: Neutral to Buy

Buy above 1.1510-1.1295 with risk below 1.1250, targeting 1.1540-1.1610 and 1.1660-1.1720. Sell below 1.1540-1.1720 targeting 1.1510-1.1450-1.1400 and 1.1360-1.1320-1.1250 with stop-loss at daily closing above 1.1720.

 
Intraday Support Levels
S1     1.1510-1.1450
S2     1.1400
S3     1.1320-1.1250

Intraday  Resistance Levels
R1     1.1540-1.1610
R2     1.1660
R3     1.1720

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.087 Buy
20-DMA   1.1541 Sell
50-DMA   1.1612 Sell
100-DMA   1.1793 Sell
200-DMA   1.1963 Sell
STOCH(5,3)   93.202 Sell
MACD(12,26,9)   -0.0062 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.2728/GBP, high of US$1.2798/GBP and settled the day up by 0.415% to close at US$1.2795/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 1.2840-1.2990 with targets at 1.2750-1.2700-1.2660 and 1.2580-1.2500. Buy above 1.2750-1.2500 with targets 1.2840-1.2900 and 1.2950-1.2990 with stop loss closing below 1.2500.

 
Intraday Support Levels
S1     1.2750
S2     1.2700-1.2660
S3     1.2580

Intraday Resistance Levels
R1     1.2840
R2     1.2900
R3     1.2950-1.2990

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

38.830

Buy
20-DMA   1.2920 Buy
50-DMA   1.3085 Buy
100-DMA   1.3381 Buy
200-DMA   1.3554 Buy
STOCH(5,3)   75.254 Buy
MACD(12,26,9)   -0.0108 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.01/USD and made an intraday high of JPY111.67/USD and settled the day down by 0.479% at JPY110.05 /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 110.70-112.50 with risk above 112.50 targeting 109.80-109.00. Long positions above 110.20-109.40 with targets of 110.70-111.40-112.00 and 113.50-114.00 with stop below 107.00.

 
Intraday Support Levels
S1     110.20-109.80
S2     109.40
S3     109.00

INTRADAY RESISTANCE LEVELS
R1     110.70
R2     111.40-112.00
R3     112.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.755 Buy
20-DMA   111.01 Buy
50-DMA   111.00 Buy
100-DMA   109.99 Buy
200-DMA   109.85 Buy
STOCH(9,6)   17.303 Buy
MACD(12,26,9)   -0.022 Sell

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