AAFX TRADING

Daily Market Lookup

  • Asian share markets sank in a sea of red on Thursday after Wall Street suffered its worst drubbing in eight months, a conflagration of wealth that could threaten business confidence and investment across the globe. The global plunge erased hundreds of billions of dollars of wealth. The head of the International Monetary Fund said stock market valuations have been “extremely high”. The blood letting was bad enough to attract the attention of U.S. President Donald Trump, who pointed an accusing finger at the Fed for raising interest rates. It was hawkish commentary from Fed policymakers that triggered the sudden sell off in Treasuries last week and sent long-term yields to their highest in seven years. The surge made stocks look less attractive compared to bonds while also threatening to curb economic activity and profits. The shift in yields is also sucking funds out of emerging markets, putting particular pressure on the Chinese yuan as Beijing fights a protracted trade battle with the United States. On Thursday, the president of the World Bank said he is very concerned about trade tensions and warned of a “clear” global economic slowdown if tariff threats escalate. China has suspended approvals for an overseas investment product in Shanghai and has asked license holders such as JPMorgan Asset Management and Aberdeen Standard Investments to be “low profile” in marketing it, as concerns rise in Beijing over possible outflow pressures. There was also a danger for the U.S. if Beijing had to intervene heavily to support the yuan. The dollar was already losing ground to both the yen and the euro, as investors favored currencies of countries that boasted large current account surpluses.
  • The EUR/USD major pair is clipping into 1.1570 ahead of the European market session for Thursday, as broader market sees a continued slide in the Greenback extending from the US session on Wednesday. Thursday brings the European Central Bank's (ECB) Monetary Policy Meeting Accounts at 11:30 GMT, but Italy headlines are never far away after driving the EUR/USD for much of the early week. Trade war fears and rising US Treasury yields are seeing the USD take a beating in the broader markets, and as long as bulls manage to keep their wheels upright the long-side trend should continue through Thursday's action. The Euro could be on pace to extend the early session's gains, as the US Dollar looks set to take another leg lower across the G10 FX space, but the US' CPI reading later today at 12:30 GMT (forecast 2.3%, previous 2.2%) will likely see an acceleration in volatility. Positive-leaning Brexit headlines are helping to provide support for the GBP heading into Thursday, with UK Prime Minister Theresa May gearing up to try and swing a temporary trade agreement with the European Union following Brexit, at least until a firmer plan can be realized. Eurosceptics within PM May's own government are already baying for blood, and calls are beginning to arise for the dissolution of May's government, but bullish hopefuls are focusing on the positives for the time being. It's going to be a tense day on the economic calendar for the Cable, with an early speech from the Bank of England's (BoE) Carney at 05:00 GMT, to be followed by the BoE's Credit Conditions survey at 08:30 GMT, another appearance from Mark Carney at 09:00 GMT, and finally a speech from MPC Voting Member Vlieghe at 10:45 GMT; after that will be the US' CPI reading at 12:30 GMT, and core inflation in September is expected to tick up from 2.2% to 2.3%.
  • Oil prices fell to two-week lows on Thursday as they extended big losses from the previous session amid a rout in global stock markets, with oil also taking a hit from an industry report showing U.S. crude inventories rose more than expected. Supply worries also eased as Hurricane Michael likely spared oil assets from significant damage as it smashed into Florida, even as it caused at least one death, injuries and widespread destruction. Stocks on major world markets slid to a three-month low on Wednesday, with the benchmark S&P500 stock index falling more than 3 percent, its biggest one-day decline since February. U.S. crude stockpiles rose more than expected last week, while gasoline inventories increased and distillate stocks drew, industry group the American Petroleum Institute said on Wednesday. Crude inventories climbed by 9.7 mn barrels in the week to Oct. 5 to 410.7 million, compared with analyst expectations for an increase of 2.6 mn barrels. Crude stocks at the Cushing, Oklahoma, delivery hub rose by 2.2 million barrels, API said. The U.S. EIA is due to release official government inventory data Thursday at 11 a.m. EDT. In the U.S. Gulf of Mexico, producers have cut daily oil production by roughly 42% due to the storm, the Bureau of Safety and Environmental Enforcement said. The cuts represent 718,877 barrels per day of oil production. U.S. oil output is expected to rise 1.39 million bpd to a record 10.74 million bpd, the EIA said in its monthly forecast on Wednesday.

 

 
Intraday RESISTANCE LEVELS
11th October 2018 R1 R2 R3
GOLD-XAU 1,194 1,207-1,214 1,220
Silver-XAG 14.80 15.10 15.50-16.40
Crude Oil 72.00-72.60 73.00 73.90
EURO/USD 1.1610-1.1690 1.1730 1.1790
GBP/USD 1.3250-1.3290 1.3350 1.3450
USD/JPY 112.50-113.00 114.00 114.70-115.50

Intraday SUPPORTS LEVELS
11th October 2018 S1 S2 S3
GOLD-XAU 1,186-1,174 1,166 1,160
Silver-XAG 14.00 13.61 13.00-12.40
Crude Oil 71.20-70.50 70.10 69.60
EURO/USD 1.1540 1.1460-1.1432 1.1380
GBP/USD 1.3140-1.3060 1.2990 1.2950-1.2890
USD/JPY 112.00-111.50 111.20 110.70

Intra-Day Strategy (11th October 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$1194.67/oz and low of US$1185.25/oz. Gold up by 0.430% at US$1194.47/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 1200-1227 keeping stop loss closing above 1227, targeting 1184-1172 and 1166-1159. Buy above 1184-1159 with risk below 1159, targeting 1191-1207-1214 and 1220-1227.

 
Intraday Support Levels
S1     1,186-1,174
S2     1,166
S3     1,160
Intraday Resistance Levels
R1     1,194
R2     1,207-1,214
R3     1,220

Technical Indicators

Name   Value Action
14DRSI  

44.825

Buy
20-DMA   1197.33 Sell
50-DMA  

1198.60

Sell
100-DMA   1231.36 Sell
200-DMA   1279.13 Sell
STOCH(5,3)   38.248 Sell
MACD(12,26,9)   -1.247 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$14.41/oz and low of US$14.22/oz. Silver settled down by 0.487% at US$14.28/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 14.40-12.40 targeting 14.90-15.10 and 15.60-16.35; stop breakage below 12.40. Sell below 14.90-17.00 with stop loss above 17.00; targeting 14.40-13.90 and 13.50-13.00.

 
Intraday  Support Levels
S1     14.00
S2     13.61
S3     13.00-12.40

Intraday  Resistance Levels
R1     14.80
R2     15.10
R3     15.50-16.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.953 Buy
20-DMA   14.29 Sell
50-DMA   14.68 Sell
100-DMA   15.45 Sell
200-DMA   16.06 Sell
STOCH(5,3)   68.02 Buy
MACD(12,26,9)   -0.054 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$74.96/bbl, intraday low of US$72.25/bbl and settled downby 2.843% to close at US$72.44/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 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 overbought region and giving negative crossover for confirmation of bearish 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 72.00-73.90 with stop loss at 73.90; targeting 71.40-70.50 and 70.10-69.60. Buy above 71.40-69.60 with risk daily closing below 69.60 and targeting 72.00-72.60 and 73.00-73.90.

 
Intraday Support Levels
S1     71.20-70.50
S2     70.10
S3     69.60

Intraday Resistance Levels
R1     72.00-72.60
R2     73.00
R3     73.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.235 Sell
20-DMA   72.39 Buy
50-DMA   69.58 Buy
100-DMA   68.92 Buy
200-DMA   66.93 Buy
STOCH(5,3)   15.710 Sell
MACD(12,26,9)   1.162 Buy

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.14792/EUR, high of US$1.1544/EUR and settled the day up by 0.252% to close at US$1.1517/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 1.1540-1.1300 with risk below 1.1300, targeting 1.1610-1.1690 and 1.1760-1.1800. Sell below 1.1610-1.1790 targeting 1.1540-1.1460-1.1430 and 1.1380-1.1300 with stop-loss at daily closing above 1.1700.

 
Intraday Support Levels
S1     1.1540
S2     1.1460-1.1432
S3     1.1380

Intraday  Resistance Levels
R1     1.1610-1.1690
R2     1.1730
R3     1.1790

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.586 Buy
20-DMA   1.1617 Sell
50-DMA   1.1583 Sell
100-DMA   1.1627 Sell
200-DMA   1.1922 Sell
STOCH(5,3)   66.315 Sell
MACD(12,26,9)   0.0031 Buy

GBP/USD

AAFX TRADING

GBP/USD on wednesday made an intra‐day low of US$1.3128/GBP, high of US$1.3214/GBP and settled the day up by 0.357% to close at US$1.3187/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2970) 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 neutral territory and giving positive crossover to confirm bullish stance. MACD is above zero line but histograms are increasing lead to downward movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; sell below 1.3250-1.3450 with targets at 1.3140-1.3060-1.2990 and 1.2950-1.2890. Buy above 1.3200-1.2890 with targets 1.3250-1.3290 and 1.3350-1.3450 with stop loss closing below 1.2890.

 
Intraday Support Levels
S1     1.3140-1.3060
S2     1.2990
S3     1.2950-1.2890

Intraday Resistance Levels
R1     1.3250-1.3290
R2     1.3350
R3     1.3450

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

61.080

Buy
20-DMA   1.3106 Buy
50-DMA   1.2975 Buy
100-DMA   1.3099 Buy
200-DMA   1.3492 Buy
STOCH(5,3)   93.169 Buy
MACD(12,26,9)   0.0003 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY112.24/USD and made an intraday high of JPY113.82/USD and settled the day down by 0.602% at JPY112.26/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (111.56), which is major resistance on the daily chart. 14-D RSI is currently in overbought region and chances of downward are expected based on RSI. 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 112.50-115.50 with risk above 115.50 targeting 112.00-111.50 and 111.20-110.70. Long positions above 112.00-111.00 with targets of 112.50-113.00-114.00 and 114.70-115.50 with stop below 111.00.

 
Intraday Support Levels
S1     112.00-111.50
S2     111.20
S3     110.70

INTRADAY RESISTANCE LEVELS
R1     112.50-113.00
R2     114.00
R3     114.70-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.008 Buy
20-DMA   112.96 Buy
50-DMA   111.82 Buy
100-DMA   111.24 Buy
200-DMA   109.77 Buy
STOCH(9,6)   5.7477 Buy
MACD(12,26,9)   0.320 Sell

AAFX TRADING
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