AAFX TRADING

Daily Market Lookup

  • Asian shares barely managed to hold firm on Monday after a tumultuous week for global equities, with U.S. stock futures turning down and Chinese markets deep in the red on fresh signs of cooling in the world's second-biggest economy. The losses in Asia were largely led by China's blue-chip index which tumbled 2.5% following disappointing earnings from the country's top liquor maker Kweichow Moutai. Chinese data over the weekend also underscored worries of a cooling economy as profit growth at its industrial firms slowed for the fifth consecutive month in September as sales of raw materials and manufactured goods ebbed. Citibank has projected China's real economic growth to slow to 6.4 percent year-on-year in the fourth quarter "amid trade headwinds and domestic uncertainties," compared to a 6.8 percent rise at the start of the year. Wider sentiment in global financial markets has been hit by a range of negative factors from an intensifying China-U.S. trade conflict to worries about U.S. corporate earnings to Italian budget woes as well as Federal Reserve rate increases. Analysts warn of more volatility after heavy losses across major equity indices left investors with negative returns for the year. Bears are on the rise, with some indices already in official correction territory amid heightened worries over corporate earnings and global growth. Data out last week showed U.S. economic growth slowed to an annualized 3.5 percent in the third quarter with the slowdown partly driven by a tariff-related drop in soybean exports. Investors heaved a sigh of relief after German Chancellor Angela Merkel's junior coalition partners gave her conservatives until next year to deliver more policy results. However, concerns loomed over her future after both parties suffered in a regional election on Sunday.
  • The dollar held firm against a basket of its key rivals on Monday, not far off a 10-week peak hit after data showed U.S. economic growth slowed less than expected and as global risk sentiment remained fragile. The U.S. currency has found support recently on safe-haven buying as investor demand for riskier assets waned on steep declines in world equity markets on concerns over corporate earnings, geopolitical uncertainty and global growth. On Friday, it rose as high as 96.860, its best level since Aug. 15, after data showed the U.S. economy slowed less than expected in the third quarter, before turning down to end 0.3 percent lower on the day. Trade tensions between the United States and China, and a steady pace of rate increases by the Federal Reserve, have boosted the dollar, which serves as a safe haven in times of turmoil and economic stress. A relatively strong U.S. economy has also underpinned the dollar, although some weak corporate earnings have started to stoke doubts about the growth outlook especially in an environment of rising borrowing costs. The euro has lost 1.8 percent this month on concerns over Italy's free-spending budget that would breach European Union fiscal rules. Markets have been jittery and yields on Italy's bonds have spiked since September as the EU disapproved of Rome's budget plans. Far-right lawmaker Jair Bolsonaro won Brazil's presidential election on Sunday, riding a wave of frustration over corruption and crime that brought a dramatic swing to the right in the world's fourth-largest democracy. Yamamoto expected traders to cash in on long positions in Brazil's real that were largely taken up in the weeks ahead of Sunday's poll.
  • Shortly after U.S. President Donald Trump announced in May he would reimpose sanctions on Iran, the State Department began telling countries around the world the clock was ticking for them to cut oil purchases from the Islamic Republic to zero. The strategy is meant to cripple Iran's oil-dependent economy and force Tehran to quash not only its nuclear ambitions, but this time, its ballistic missile program and its influence in Syria. With just days to go before renewed sanctions take effect Nov. 5, the reality is setting in: three of Iran’s top five customers – India, China, and Turkey - are resisting Washington’s call to end purchases outright, arguing there are not sufficient supplies worldwide to replace them, according to sources familiar with the matter. hat pressure, along with worries of a damaging oil price spike, is putting the Trump administration’s hard line to the test and raising the possibility of bilateral deals to allow some buying to continue, according to the sources. The tension has split the administration into two camps, one led by National Security Adviser John Bolton, who wants the toughest possible approach, and another by State Department officials keen to balance sanctions against preventing an oil price spike that could damage the U.S. and its allies, according to a source briefed by administration officials on the matter. Revenues from sales could be escrowed for use by Tehran exclusively for humanitarian purposes, the source, who asked not to be named, said – a mechanism more stringent than a similar one imposed on Iran oil purchases during the last round of sanctions under U.S. President Barack Obama. Such concessions could be problematic for the White House as it seeks stricter terms than under Obama, who along with European allies imposed sanctions that led to an agreement limiting Iran's nuclear weapons development. The State Department declined comment for this story, but the administration has confirmed Washington is considering waivers. U.S. Treasury Secretary Steven Mnuchin told Reuters that countries will first have to reduce purchases of Iran’s oil by more than the 20 percent level they did under the previous sanctions.

 

 
Intraday RESISTANCE LEVELS
29th October 2018 R1 R2 R3
GOLD-XAU 1,238-1,246 1,254 1,260
Silver-XAG 14.80 15.10 15.50-16.40
Crude Oil 67.70 68.10 68.50-69.05
EURO/USD 1.1430-1.1490 1.1540 1.1610-1.1690
GBP/USD 1.2840-1.2900 1.2950 1.3000-1.3060
USD/JPY 112.10-113.00 114.00 114.70-115.50

Intraday SUPPORTS LEVELS
29th October 2018 S1 S2 S3
GOLD-XAU 1,230 1,221 1,214-1,207
Silver-XAG 14.30-14.00 13.61 13.00-12.40
Crude Oil 67.10 66.10-65.70 65.10
EURO/USD 1.1340 1.1300 1.2960-1.2900
GBP/USD 1.2790-1.2750 1.2700 1.2660
USD/JPY 111.50-111.20 110.70 110.00

Intra-Day Strategy (29th 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 Friday made its intraday high of US$1229.49/oz and low of US$1220.00/oz. Gold up by 0.133% at US$1221.73/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 1238-1254 keeping stop loss closing above 1254, targeting 1230-1221-1214 and 1207-1200. Buy above 1230-1194 with risk below 1194, targeting 1238-1244 and 1250-1256.

 
Intraday Support Levels
S1     1,230
S2     1,221
S3     1,214-1,207
Intraday Resistance Levels
R1     1,238-1,246
R2     1,254
R3     1,260

Technical Indicators

Name   Value Action
14DRSI  

61.504

Buy
20-DMA   1213.83 Sell
50-DMA  

1204.53

Sell
100-DMA   1221.76 Sell
200-DMA   1272.62 Sell
STOCH(5,3)   63.027 Buy
MACD(12,26,9)   8.449 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$14.76/oz and low of US$14.56/oz. Silver settled up by 0.479% at US$14.68/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 14.35-12.40 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   48.301 Buy
20-DMA   14.56 Sell
50-DMA   14.46 Sell
100-DMA   15.12 Sell
200-DMA   15.85 Sell
STOCH(5,3)   45.867 Sell
MACD(12,26,9)   -0.044 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$67.89/bbl, intraday low of US$66.22/bbl and settled up by 1.06% to close at US$67.64/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 67.10-69.60 with stop loss at 69.60; targeting 66.10-65.70 and 65.10-64.50. Buy above 66.10-64.50 with risk daily closing below 64.50 and targeting 67.10-67.70-68.10 and 69.00-69.60.

 
Intraday Support Levels
S1     67.10
S2     66.10-65.70
S3     65.10

Intraday Resistance Levels
R1     67.70
R2     68.10
R3     68.50-69.05

TECHNICAL INDICATORS
Name   Value Action
14DRSI   22.330 Sell
20-DMA   71.27 Buy
50-DMA   70.11 Buy
100-DMA   69.21 Buy
200-DMA   67.24 Buy
STOCH(5,3)   22.330 Buy
MACD(12,26,9)   -0.1145 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1335/EUR, high of US$1.1420/EUR and settled the day up by 0.254% to close at US$1.1402/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1621), 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 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 1.1430-1.1290 with risk below 1.1290, targeting 1.1430-1.1490-1.1540 and 1.1610-1.1690. Sell below 1.1430-1.1690 targeting 1.1380-1.1340-1.1300 and 1.2960-1.2900 with stop-loss at daily closing above 1.1750.

 
Intraday Support Levels
S1     1.1340
S2     1.1300
S3     1.2960-1.2900

Intraday  Resistance Levels
R1     1.1430-1.1490
R2     1.1540
R3     1.1610-1.1690

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.093 Buy
20-DMA   1.1499 Sell
50-DMA   1.1586 Sell
100-DMA   1.1604 Sell
200-DMA   1.1887 Sell
STOCH(5,3)   16.510 Sell
MACD(12,26,9)   -0.0055 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2840/GBP, high of US$1.2840/GBP and settled the day up by 0.132% to close at US$1.2830/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 1.2900-1.3100 with targets at 1.2870-1.2840-1.2790 and 1.2750-1.2700. Buy above 1.2840-1.2700 with targets 1.2900-1.2950-1.3000 and 1.3060-1.3100 with stop loss closing below 1.2870.

 
Intraday Support Levels
S1     1.2790-1.2750
S2     1.2700
S3     1.2660

Intraday Resistance Levels
R1     1.2840-1.2900
R2     1.2950
R3     1.3000-1.3060

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

35.548

Buy
20-DMA   1.3043 Buy
50-DMA   1.3018 Buy
100-DMA   1.3063 Buy
200-DMA   1.3455 Buy
STOCH(5,3)   5.3660 Sell
MACD(12,26,9)   -0.0046 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY111.37/USD and made an intraday high of JPY112.43/USD and settled the day down by 0.462% at JPY111.88/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 112.00-110.70 with targets of 112.50-113.00-114.00 and 114.70-115.50 with stop below 111.00.

 
Intraday Support Levels
S1     111.50-111.20
S2     110.70
S3     110.00

INTRADAY RESISTANCE LEVELS
R1     112.10-113.00
R2     114.00
R3     114.70-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.433 Buy
20-DMA   112.27 Sell
50-DMA   112.11 Sell
100-DMA   111.55 Buy
200-DMA   109.81 Buy
STOCH(9,6)   39.899 Buy
MACD(12,26,9)   0.051 Sell

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