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Daily Market Lookup

  • A sell-off in Chinese shares pulled Asian equities to a 14-month trough on Monday as investors braced for a potentially damaging escalation in the Sino-U.S. tariff row after U.S. President Donald Trump raised the stakes in the dispute with Beijing. Asian investors were jittery after Trump said on Friday he was ready to slap tariffs on virtually all Chinese imports into the United States, threatening duties on another $267 billion of goods in addition to the $200 billion already facing the risk of duties. Beijing has warned of retaliation if Washington launches any new measures, but it is running out of room to match them dollar-for-dollar, raising concerns it could resort to other measures such as weakening the yuan or taking action against U.S. companies in China. Trump, who is challenging China, Mexico, Canada and the European Union on trade issues, has now expressed displeasure about his country's large trade deficit with Japan. Investors are also on the edge about any contagion risks from turmoil in some emerging markets (EM) including Argentina and Turkey whose currencies have been routed recently. Some Asian economies too are vulnerable, Nomura analysts said in a lengthy report with many countries burdened with high private debt. They also noted a "concentration risk" from some of the world's largest funds' heavy investments in EM assets. Another factor weighing on global markets is the prospect of faster rate rises by the Federal Reserve after data on Friday showed U.S. job growth accelerated in August and wages notched their largest annual increase in more than nine years. The Fed is all but certain to raise rates a third time this year in late September. The strong employment report boosted the dollar, which held on to Friday's gains at 95.43. The index is up 3.5 percent so far this year. Investors will next focus on U.S. inflation for August due Thursday and a stronger number could once again send the dollar surging.
  • The dollar edged higher against a basket of currencies on Monday thanks to strong U.S. August jobs data and amid fears of a potentially major escalation in the China-U.S. trade conflict. U.S. President Donald Trump warned on Friday that he was ready to slap tariffs on virtually all Chinese imports into the United States, threatening duties on another $267 billion of goods in addition to the $200 billion already facing the risk of duties. The strong data further supported the prospect of faster rate rises by the Federal Reserve, boosting demand for the dollar. The Fed is all but certain to raise rates a third time this year in late September. Still, markets remained on edge about a possible new round of U.S. tariffs on imports from China. Investors have been waiting for a fresh salvo to be fired in the Sino-U.S. trade war after a public comment period for proposed U.S. tariffs on a list of $200 billion worth of Chinese imports, which includes some consumer products, ended late last week.
  • Oil prices rose on Monday as U.S. drilling for new production stalled and as the market eyed tighter conditions once Washington's sanctions against Iran's crude exports kick in from November. U.S. energy companies cut two oil rigs last week, bringing the total count to 860, energy services firm Baker Hughes said on Friday. The U.S. rig count has stagnated since May, after staging a recovery since 2016, which followed a steep slump the previous year amid plummeting crude prices. Outside the United States, new U.S. sanctions against Iran's crude exports from November were helping push up prices. Energy consultancy FGE said several major Iran customers like India, Japan and South Korea were already cutting back on Iran crude. With U.S. rig activity stalling and Iran sanctions looming, the oil market outlook is tightening. Backwardation describes a market in which prices for immediate delivery are higher than those for later dispatch. It is considered a sign of tight conditions giving traders an incentive to sell oil immediately instead of storing it. While Washington exerts pressure on other countries to fall into line and also cut imports from Iran, it is also urging other major producers to raise their output in order not to create too strong a price spike. U.S. Energy Secretary Rick Perry will meet counterparts from Saudi Arabia and Russia on Monday and Thursday, respectively, as the Trump administration seeks the world's biggest exporter and producer to keep output up. One key question going forward is how demand develops amid the trade dispute between the United States and China, as well as general emerging market weakness. Despite this, FGE said the likelihood of significantly weaker oil prices was relatively low as the OPEC would withhold output to prevent prices from plunging.

 

 
Intraday RESISTANCE LEVELS
10th 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 68.00 68.50-69.00 70.00
EURO/USD 1.1540-1.1610 1.1660 1.1690-1.1760
GBP/USD 1.2950 1.2990 1.3060-1.3100
USD/JPY 112.00-112.50 113.20 114.00

Intraday SUPPORTS LEVELS
10th 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 67.60-67.00 65.80 65.30
EURO/USD 1.1510-1.1450 1.1400 1.1330
GBP/USD 1.2870 1.2800-1.2750 1.2680
USD/JPY 110.70 110.20 109.80-109.30

Intra-Day Strategy (10th 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 Friday made its intraday high of US$1203.41/oz and low of US$1193.33/oz. Gold down by 0.294% at US$1195.72/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 1200-1235 keeping stop loss closing above 1235, targeting 1196-1189-1180 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  

43.538

Buy
20-DMA   1194.85 Sell
50-DMA  

1215.35

Sell
100-DMA   1254.75 Sell
200-DMA   1286.41 Sell
STOCH(5,3)   38.361 Sell
MACD(12,26,9)   -4.941 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$14.24/oz and low of US$14.06/oz. Silver settled up by 0.354% at US$14.16/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 Friday made an intra‐day high of US$67.89/bbl, intraday low of US$66.71/bbl and settled down by 0.0738% to close at US$67.65/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 68.00-70.00 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     67.60-67.00
S2     65.80
S3     65.30

Intraday Resistance Levels
R1     68.00
R2     68.50-69.00
R3     70.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.934 Sell
20-DMA   67.64 Buy
50-DMA   68.40 Buy
100-DMA   68.46 Buy
200-DMA   65.35 Buy
STOCH(5,3)   24.015 Buy
MACD(12,26,9)   0.200 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1549/EUR, high of US$1.1649/EUR and settled the day down by 0.602% to close at US$1.1552/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 1.1540-1.1610-1.1660 and 1.1720-1.1800. Sell below 1.1540-1.1800 targeting 1.1540-1.1450-1.1400 and 1.1360-1.1320 with stop-loss at daily closing above 1.1800.

 
Intraday Support Levels
S1     1.1510-1.1450
S2     1.1400
S3     1.1330

Intraday  Resistance Levels
R1     1.1540-1.1610
R2     1.1660
R3     1.1690-1.1760

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.502 Buy
20-DMA   1.1559 Sell
50-DMA   1.1610 Sell
100-DMA   1.1696 Sell
200-DMA   1.1949 Sell
STOCH(5,3)   44.635 Sell
MACD(12,26,9)   -0.0015 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2907/GBP, high of US$1.3027/GBP and settled the day down by 0.069% to close at US$1.2915/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     1.2870
S2     1.2800-1.2750
S3     1.2680

Intraday Resistance Levels
R1     1.2950
R2     1.2990
R3     1.3060-1.3100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

48.720

Buy
20-DMA   1.2847 Buy
50-DMA   1.3011 Buy
100-DMA   1.3230 Buy
200-DMA   1.3534 Buy
STOCH(5,3)   38.650 Sell
MACD(12,26,9)   -0.0021 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY110.37/USD and made an intraday high of JPY111.24/USD and settled the day up by 0.261% at JPY110.03/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     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   37.650 Buy
20-DMA   110.97 Buy
50-DMA   111.23 Buy
100-DMA   110.53 Buy
200-DMA   109.78 Buy
STOCH(9,6)   37.885 Buy
MACD(12,26,9)   -0.001 Sell

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