AAFX TRADING

Daily Market Lookup

  • Asian equities got some welcome relief on Wednesday after upbeat U.S. earnings reports drove a rebound on Wall Street and helped restore a little faith in emerging market stocks and currencies. U.S. stocks had jumped more than 2 percent on Tuesday in reaction to upbeat earnings reports from major companies including UnitedHealth and Goldman Sachs. The U.S. economic news was also robust, notably a sharp rise in job openings to a fresh all-time high. The latest survey of global fund managers by BofA Merrill Lynch found they saw emerging market currencies as the most undervalued ever against the U.S. dollar. Not helping the dollar was fresh criticism of the Federal Reserve from U.S. President Donald Trump, who told Fox Business Network: “My biggest threat is the Fed.” Trump has recently castigated the central bank for raising interest rates. Minutes of the last Fed meeting are due out later Wednesday are expected to show policy makers remain committed to further gradual tightening.
  • The dollar strengthened against most major peers on Wednesday, while the yen weakened as upbeat Wall Street earnings reduced global appetites for safe haven assets. The three main Wall Street indexes each rose by more than 2 percent as blue-chips delivered strong earnings indicating that the U.S. economic recovery is on track despite rising interest rates and global trade war tensions. Data on Tuesday showed that U.S. industrial production increased for a fourth straight month in September, boosted by gains in manufacturing and mining output, but momentum slowed sharply in the third quarter. Market participants will be looking for clues on the dollar's direction and the path ahead on U.S. interest-rate hikes from minutes of the Federal Reserve's September meeting, due for release later on Wednesday. While sterling was supported by Tuesday's stronger than expected British employment data, investors are still doubtful that the European Union Summit on Wednesday will yield much progress on the Northern Island border issue blocking a Brexit agreement.
  • Oil prices extended gains into a fourth session on Wednesday, buoyed as industry data showed a surprise decline in U.S. crude inventories and as geopolitical tensions over the disappearance of a prominent Saudi journalist stoked supply worries. U.S. crude inventories fell by 2.1 million barrels last week, compared with analyst expectations for a build of 2.2 million barrels, American Petroleum Institute data showed after Tuesday's settlement. U.S. gasoline stocks dropped by a larger-than-expected 3.4 million barrels, while distillate fuel stockpiles declined by a smaller-than-expected 246,000 barrels, the API data showed. Inventory data from the U.S. Energy Department's Energy Information Administration is due at 1430 GMT on Wednesday. U.S. President Donald Trump gave Saudi Arabia the benefit of the doubt in the disappearance of journalist Jamal Khashoggi even as U.S. lawmakers pointed the finger at the Saudi leadership and Western pressure mounted on Riyadh to provide answers. Jim Ritterbusch, president of Ritterbusch and Associates, said Saudi Arabia could cut as much as 500,000 barrels per day of crude production "as a warning shot should the U.S. opt to impose any type of sanction in response to the Khashoggi developments". Meanwhile, OPEC Secretary-General Mohammad Barkindo on Tuesday urged oil producing companies to increase capacities and invest more to meet future demand as spare oil capacity shrinks worldwide. The Russian government is no longer capping oil output increases by local producers, one of the country's top energy companies, Gazprom (MCX:GAZP) Neft, said on Tuesday. The market has been supported by reports that Iranian crude exports may be falling faster than expected ahead of Nov. 4, the date U.s. sanctions on the commodity are due to start.

 

 
Intraday RESISTANCE LEVELS
17th October 2018 R1 R2 R3
GOLD-XAU 1,230-1,238 1,246 1,254
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 1.3200 1.3250 1.3290-1.3350
USD/JPY 112.50-113.00 114.00 114.70-115.50

Intraday SUPPORTS LEVELS
17th October 2018 S1 S2 S3
GOLD-XAU 1,221 1,214-1,207 1,200
Silver-XAG 14.30-14.00 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 1.3150-1.31000.0031 1.3060 1. 2990-1.2950
USD/JPY 111.90-111.50 111.20 110.70

Intra-Day Strategy (17th 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 Tuesday made its intraday high of US$1232.34/oz and low of US$1223.37/oz. Gold down by 0.164% at US$1224.58/oz.

Technicals in Focus:

In daily charts, prices are below 100DMA (1228) and breakage above will call for 1240-1260. 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 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 1233-1254 keeping stop loss closing above 1254, targeting 1221-1214-12007 and 1200-1194. Buy above 1214-1194 with risk below 1194, targeting 1228-1238 and 1244-1250.

 
Intraday Support Levels
S1     1,221
S2     1,214-1,207
S3     1,200
Intraday Resistance Levels
R1     1,230-1,238
R2     1,246
R3     1,254

Technical Indicators

Name   Value Action
14DRSI  

61.586

Buy
20-DMA   1201.73 Sell
50-DMA  

1199.26

Sell
100-DMA   1227.29 Sell
200-DMA   1276.61 Sell
STOCH(5,3)   84.046 Buy
MACD(12,26,9)   4.823 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$14.83/oz and low of US$14.60/oz. Silver settled down by 0.136% at US$14.64/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (15.45), breakage above will lead to16.05-16.30. 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 neutral 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 14.30-12.40 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     14.30-14.00
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   52.978 Buy
20-DMA   14.47 Sell
50-DMA   14.50 Sell
100-DMA   15.25 Sell
200-DMA   15.94 Sell
STOCH(5,3)   70.939 Sell
MACD(12,26,9)   -0.0016 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$72.12/bbl, intraday low of US$70.87/bbl and settled up by 0.643% to close at US$71.99/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 50DMA i.e. 69.62 which is a support level 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 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   49.759 Sell
20-DMA   72.74 Buy
50-DMA   69.76 Buy
100-DMA   69.04 Buy
200-DMA   67.08 Buy
STOCH(5,3)   24.084 Buy
MACD(12,26,9)   0.568 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1620/EUR, high of US$1.1620/EUR and settled the day down by 0.0431% to close at US$1.1572/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1627), which become immediate resistance level, break below will target 1.1690-1.1730. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought 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 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   51.014 Buy
20-DMA   1.1617 Sell
50-DMA   1.1584 Sell
100-DMA   1.1627 Sell
200-DMA   1.1920 Sell
STOCH(5,3)   80.273 Buy
MACD(12,26,9)   0.0031 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3134/GBP, high of US$1.3235/GBP and settled the day up by 0.191% to close at US$1.3175/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.3096) 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 1.3200-1.3450 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     1.3150-1.31000.0031
S2     1.3060
S3     1. 2990-1.2950

Intraday Resistance Levels
R1     1.3200
R2     1.3250
R3     1.3290-1.3350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

56.702

Buy
20-DMA   1.3113 Buy
50-DMA   1.2993 Buy
100-DMA   1.3094 Buy
200-DMA   1.3485 Buy
STOCH(5,3)   53.497 Sell
MACD(12,26,9)   0.0039 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY111.72/USD and made an intraday high of JPY112.33/USD and settled the day up by 0.438% at JPY112.24/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (111.82), which is major support 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     111.90-111.50
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   43.677 Buy
20-DMA   112.94 Buy
50-DMA   111.85 Buy
100-DMA   111.32 Buy
200-DMA   109.75 Buy
STOCH(9,6)   14.997 Buy
MACD(12,26,9)   0.060 Sell

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