AAFX TRADING

Daily Market Lookup

  • Stock markets fell in Asia on Wednesday and the safe-haven dollar hovered near a two-week high as heightened worries over international trade conflicts and emerging market weakness curbed investors' appetite for riskier assets. The Shanghai Composite Index (SSEC) retreated 0.9 percent, weighed down by expectations the United States will impose more tariffs on Chinese goods this month, adding to pressure on China's cooling economy. Discussions between the United States and Canada were expected to resume on Wednesday after the last round ended on Friday with no deal to revamp the North American Free Trade Agreement, cooling investor confidence. Ottawa is not expected to back down on key issues despite threats from U.S. President Donald Trump to retaliate against the Canadian economy. Keeping investors nervous is the threat of fresh U.S tariffs on another $200 billion worth of Chinese goods that could take effect after a public comment period ends on Thursday Wobbly emerging markets stocks and currencies, a key source of recent global market angst, faced their latest round of pressure with news that South Africa had slipped into recession and concerns brewing about inflation in Turkey. With investors avoiding emerging market currencies, the dollar was supported thanks to its safe-haven appeal. The dollar had also drawn strength on Tuesday from upbeat U.S. indicators supporting the case for further interest rate hikes by the Federal Reserve. Data on Tuesday showed U.S. manufacturing activity accelerated to more than a 14-year high in August, boosted by a surge in new orders.
  • The U.S. dollar edged lower against a basket of currencies on Wednesday, and an Australian dollar that had been languishing at its weakest levels since mid-2016 gained after Australia posted its best economic growth in six years. The dollar's losses against other currencies were largely limited as investors stayed loyal to the safe-haven greenback due to wariness ahead of a looming deadline in the trade conflict between the United States and China. A survey released overnight showing U.S. manufacturing activity at a 14-year high in August reinforced expectations for rising U.S. interest rates, also underpinning the dollar and helped U.S. Treasury yields rise to three week highs. The dollar's losses remained limited as the public comment period on new tariffs on $200 billion more of Chinese imports was set to end on Thursday, whereupon U.S. President Donald Trump could follow through on plans to impose the levies, though it is unclear how quickly that could happen. Emerging market currencies fell overnight as investors feared export-oriented economies would be caught in the crossfire of any escalating trade conflict. Gold prices rose on Wednesday morning in Asia, driven by the ongoing currency crisis in Argentina, which economists expect could lead to a recession, a weaker peso and higher inflation. A monthly survey by Bloomberg on Tuesday showed that Argentina’s inflation is expected to hit 40.3% at the end of the year, higher than the 31.8% forecasted in July. With a number of emerging markets including Argentine, Turkey and Indonesia battling currency crises, the demand for gold, which is widely seen as a safe haven asset, is likely to rise.
  • Oil prices fell on Wednesday as a tropical storm hitting the U.S. Gulf coast weakened and had a lower impact on production than initially expected. Prices had jumped the previous day as dozens of U.S. oil and gas platforms in the Gulf of Mexico were shut in anticipation of damage from tropical storm Gordon. However, the storm had shifted eastward by Wednesday and was weakening, reducing its threat to producers on the western side of the Gulf. Stephen Innes, head of trading for Asia-Pacific at futures brokerage OANDA, said many crude futures traders were "caught long and wrong over the past 24 hours due to the tropical storm buying frenzy", adding that "prices pulled back considerably as the magnitude of the storm suggests production losses will be limited". A typhoon also hit Japan's east coast overnight, with some damage to oil refineries in the Osaka region, although operator said its operations were not significantly affected. Innes said the price outlook for crude was still bullish, in large part because of U.S. sanctions targeting Iran's oil sector from November. Other voices, however, cautioned on the risks to oil demand if turmoil in emerging markets starts hitting economic growth. Emerging markets are a key driver of global oil demand growth, but several of them - especially Turkey and Argentina but also Indonesia and South Africa - have seen their currencies and stock markets come under pressure in recent months amid inflation, a strong U.S.-dollar and escalating global trade disputes. Striking a balance between maximising revenue and keeping a lid on prices in order not to stall demand, top crude exporter Saudi Arabia is managing its own supply with a goal to keep crude prices in a range between $70 and $80 per barrel, OPEC and industry sources told Reuters this week.

 

 
Intraday RESISTANCE LEVELS
5th September 2018 R1 R2 R3
GOLD-XAU 1,207-1,214 1,220 1,227-1,235
Silver-XAG 14.40-14.80 15.10 15.50-16.40
Crude Oil 70.00 70.70-71.50 72.20
EURO/USD 1.1610-1.1660 1.1690 1.1760-1.1800
GBP/USD 1.2870-1.2950 1.2990 1.3060-1.3100
USD/JPY 112.00-112.50 113.20 114.00

Intraday SUPPORTS LEVELS
5th September 2018 S1 S2 S3
GOLD-XAU 1,191-1,182 1,174 1,166
Silver-XAG 14.00-13.61 13.00 12.40
Crude Oil 69.00 68.50 67.60-67.00
EURO/USD 1.1540 1.1510-1.1450 1.1400
GBP/USD 1.2800-1.2750 1.2680 1.2600
USD/JPY 111.40-110.70 110.20 109.80-109.30

Intra-Day Strategy (5th September 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$1201.87/oz and low of US$1189.57/oz. Gold down by 0.824% at US$1191.31/oz.

Technicals in Focus:

In daily charts, prices are below 50DMA (1227) and breakage above will call for1240-1260. 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 1205-1235 keeping stop loss closing above 1235, targeting 1,196-1189-1180 and 1172-1166.Buy above 1196-1172with risk below 1172, targeting1207-1214 and 1220-1227-1235.

 
Intraday Support Levels
S1     1,191-1,182
S2     1,174
S3     1,166
Intraday Resistance Levels
R1     1,207-1,214
R2     1,220
R3     1,227-1,235

Technical Indicators

Name   Value Action
14DRSI  

42.132

Buy
20-DMA   1196.02 Sell
50-DMA  

1218.33

Sell
100-DMA   1258.87 Sell
200-DMA   1287.79 Sell
STOCH(5,3)   17.285 Sell
MACD(12,26,9)   -5.954 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$14.50/oz and low of US$13.99/oz. Silver settled down by 2.213% at US$14.14/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (16.69), breakage above will lead to17.25-17.70. 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 14.00-12.40 targeting 14.40-14.90-15.10 and 15.60-16.35; stop breakage below 13.00. Sell below 14.50-17.00 with stop loss above17.00; targeting 14.50-13.90 and 13.50-13.30.

 
Intraday  Support Levels
S1     14.00-13.61
S2     13.00
S3     12.40

Intraday  Resistance Levels
R1     14.40-14.80
R2     15.10
R3     15.50-16.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   36.058 Buy
20-DMA   14.83 Sell
50-DMA   15.35 Sell
100-DMA   15.95 Sell
200-DMA   16.28 Sell
STOCH(5,3)   48.742 Buy
MACD(12,26,9)   -0.223 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$70.27/bbl, intraday low of US$68.07/bbl and settled up by 1.797% to close at US$69.66/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 61.15which is a major resistance and breakage above will call for62.20-62.80. 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 69.20-71.50 with stop loss at 71.50; targeting 68.50-67.60-67.00 and 66.50-65.70.Buy above 68.50-65.00 with risk daily closing below 65.00 and targeting 69.20-70.00 and 70.70.

 
Intraday Support Levels
S1     69.00
S2     68.50
S3     67.60-67.00

Intraday Resistance Levels
R1     70.00
R2     70.70-71.50
R3     72.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.785 Sell
20-DMA   68.53 Buy
50-DMA   68.34 Buy
100-DMA   56.52 Buy
200-DMA   52.01 Buy
STOCH(5,3)   84.351 Buy
MACD(12,26,9)   0.586 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1529/EUR, high of US$1.1627/EUR and settled the day down by 0.215% to close at US$1.1565/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 1.1540-1.1295with risk below 1.1250, targeting 1.1610-1.1660 and 1.1720-1.1800. Sell below 1.1610-1.1800 targeting 1.1540-1.1450-1.1400 and 1.1360-1.1320with stop-loss at daily closing above 1.1800.

 
Intraday Support Levels
S1     1.1540
S2     1.1510-1.1450
S3     1.1400

Intraday  Resistance Levels
R1     1.1610-1.1660
R2     1.1690
R3     1.1760-1.1800

TECHNICAL INDICATORS
Name   Value Action
14DRSI   12.152 Buy
20-DMA   1.1539 Sell
50-DMA   1.1612 Sell
100-DMA   1.1724 Sell
200-DMA   1.1955 Sell
STOCH(5,3)   12.135 Sell
MACD(12,26,9)   -0.0009 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2828/GBP, high of US$1.3042/GBP and settled the day down by 0.673% to close at US$1.2956/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 overbought 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; sell below 1.2870-1.3100 with targets at 1.2800-1.2750 and 1.2680-1.2600. Buy above 1.2800-1.2600 with targets 1.2870-1.2950-1.2990 and 1.3060-1.3100 with stop loss closing below 1.2600.

 
Intraday Support Levels
S1     1.2800-1.2750
S2     1.2680
S3     1.2600

Intraday Resistance Levels
R1     1.2870-1.2950
R2     1.2990
R3     1.3060-1.3100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

42.884

Buy
20-DMA   1.2840 Buy
50-DMA   1.3018 Buy
100-DMA   1.3254 Buy
200-DMA   1.3538 Buy
STOCH(5,3)   25.248 Sell
MACD(12,26,9)   -0.0028 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY111.48/USD and made an intraday high of JPY111.82/USD and settled the day down by 0.179% at JPY111.10/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 above110.20-109.40with targets of 110.70-111.40-112.00 and 113.50-114.00with stop below 107.00.

 
Intraday Support Levels
S1     111.40-110.70
S2     110.20
S3     109.80-109.30

INTRADAY RESISTANCE LEVELS
R1     112.00-112.50
R2     113.20
R3     114.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.458 Buy
20-DMA   110.94 Buy
50-DMA   111.13 Buy
100-DMA   110.32 Buy
200-DMA   109.79 Buy
STOCH(9,6)   41.679 Buy
MACD(12,26,9)   -0.001 Sell

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