AAFX TRADING

Daily Market Lookup

  • Asian shares jumped to three-week highs on Friday and U.S. equity futures rebounded on a report that U.S. President Donald Trump has asked officials to draft terms for a potential trade deal with China following a phone call with leader Xi Jinping. Bloomberg reported that Trump is interested in reaching a trade agreement with Xi at the Group of 20 nations summit in Argentina later this month and has asked key U.S. officials to begin drafting potential terms, citing people familiar with the matter. One person said a sticking point in any potential deal is intellectual property theft, where the Trump administration has sought to take a hard line, and it was unclear if Trump was easing up on U.S. demands that China has resisted. Earlier this week, Trump was quoted as saying Beijing wasn’t ready to do a deal and he was prepared to slap more tariffs on China if his meeting with Xi was not productive. The report came after the two leaders expressed optimism on Thursday about resolving their bitter trade disputes, one of the major factors behind a recent global equity market rout. Investors will be looking ahead to a U.S. jobs report, due at 1230 GMT, for more indications on the health of the U.S. economy and the clues on the pace of further interest rate rises. U.S. nonfarm payroll figures are expected to rise 190K in October from 134K a month earlier, with average hourly earnings seen increasing 0.2% in October after a 0.3% gain the previous month Those numbers follow data this week revealing slower factory growth around the world, adding to worries about the outlook for corporate earnings, business investment and trade Data from the U.S. showed cooling manufacturing activity in October as a measure of new orders hit a 1-1/2 year low. That came after manufacturing surveys showed factory activity and export orders weakening across Asia as the impact of the trade war deepened. The dollar had fallen across the board on Thursday as the pound rallied on reports that London is close to sealing a financial services deal with Brussels, and after the Bank of England hinted at slightly rate rises in future.
  • The dollar steadied on Friday ahead of the closely watched U.S. jobs report, after pulling back from 16-month highs in the previous session as investors cautiously moved back into riskier assets. The pound stood tall after the Bank of England kept interest rates steady on Thursday and hinted at slightly faster future rate rises if Brexit goes smoothly. World equity markets began November with a broad rally on Thursday after a brutal October, boosted by strong corporate earnings and hopes for a thaw in the U.S.-China trade row. That reduced some of the support for currencies like the dollar, which benefit in times of heightened risk aversion. The dollar was higher against its major peers earlier this week, with the euro dogged by a lackluster European economic outlook and a cautious-sounding Bank of Japan lending little support to the yen. The greenback, however, pulled back as the pound surged on Thursday following reports that London is close to sealing a financial services deal with Brussels.
  • Oil prices reversed earlier losses on Friday as hopes rose that the United States and China may resolve their trade disputes soon, easing concerns that an economic slowdown may weigh on fuel demand. Traders said oil was lifted along with Asian stock markets after a phone call between the U.S. and Chinese presidents raised hopes that the trade dispute between the world's two biggest economies could be resolved. The higher prices reversed drops earlier in the session, but Brent has still fallen by around 12 percent since the beginning of October, while WTI has lost 13 percent in value. This makes it attractive for traders to store oil for later sale, although Jefferies said "spreads are still insufficient to encourage physical storage." Downward pressure on oil is also visible in the physical market, where Saudi Arabia is expected to cut December crude prices amid higher supply and a glut in refined products that has eroded refinery profits The OPEC boosted oil production in October to 33.31 mn bpd, a Reuters survey found this week, up 390K bpd from September and the highest by OPEC since December 2016. In the United States, crude production has established itself well over 11 mn bpd, and the U.S. is now running neck and neck with Russia for the title of top producer. Russian production has risen to record high of 11.41 mn bpd in October, up from 11.36 mn bpd in September. With Saudi Arabia pumping 10.65 mn bpd in October, combined output from the top-three oil producers is at a record 33.41 mn bpd, meaning that Russia, the United States and Saudi Arabia meet more than a third of the world's almost 100 mn bpd of consumption. Despite surging output, concerns lingered ahead of the start of U.S. sanctions against Iran's petroleum exports from next week. Iran's biggest oil customers, all in Asia, are seeking sanction waivers. Despite these efforts, analysts said any potential Iranian oil sanction waivers would likely only be temporary. Goldman Sachs said it expects Iran's crude oil exports to fall to 1.15 mn bpd by the end of the year, down from around 2.5 million bpd in mid-2018. By the end of 2019, however, Goldman expects Brent to fall to $65 a barrel, largely due to "the unleashing of Permian (U.S. shale) supply growth once new pipelines come online."

 

 
Intraday RESISTANCE LEVELS
2nd November 2018 R1 R2 R3
GOLD-XAU 1,238-1,246 1,253 1,260-1,266
Silver-XAG 14.80 15.10 15.50-16.40
Crude Oil 63.80-64.30 65.10 65.70-66.30
EURO/USD 1.1430-1.1490 1.1540 1.1610-1.1690
GBP/USD 1.3000-1.3060 1.3100 1.3150
USD/JPY 113.50 114.00 114.70-115.50

Intraday SUPPORTS LEVELS
2nd November 2018 S1 S2 S3
GOLD-XAU 1,230-1,221 1,214 1,207-1,200
Silver-XAG 14.30-14.00 13.61 13.00-12.40
Crude Oil 63.30 62.70-62.05 61.50
EURO/USD 1.1300 1.1300 1.2960-1.2900
GBP/USD 1.2950-1.2900 1.2840 1.2790-1.2750
USD/JPY 113.00 112.10 111.50-111.20

Intra-Day Strategy (2nd November 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 Thursday made its intraday high of US$1237.32/oz and low of US$1214.39/oz. Gold up by 1.518% at US$1232.83/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 1238-1266 keeping stop loss closing above 1266, 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     1,230-1,221
S2     1,214
S3     1,207-1,200
Intraday Resistance Levels
R1     1,238-1,246
R2     1,253
R3     1,260-1,266

Technical Indicators

Name   Value Action
14DRSI  

58.872

Buy
20-DMA   1219.50 Sell
50-DMA  

1207.22

Sell
100-DMA   1218.80 Sell
200-DMA   1270.30 Sell
STOCH(5,3)   30.234 Buy
MACD(12,26,9)   7.949 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$14.53/oz and low of US$14.22/oz. Silver settled up by 3.445% at US$14.71/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   53.411 Buy
20-DMA   14.55 Sell
50-DMA   14.44 Sell
100-DMA   15.00 Sell
200-DMA   15.79 Sell
STOCH(5,3)   54.817 Sell
MACD(12,26,9)   -0.044 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$65.44/bbl, intraday low of US$63.15/bbl and settled down by 2.14% to close at US$63.53/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 63.80-66.30 with stop loss at 66.30; targeting 63.80-64.30-65.10 and 65.70-66.30. Buy above 63.30-61.50 with risk daily closing below 61.50 and targeting 63.80-64.30-65.10 and 65.70-66.30.

 
Intraday Support Levels
S1     63.30
S2     62.70-62.05
S3     61.50

Intraday Resistance Levels
R1     63.80-64.30
R2     65.10
R3     65.70-66.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.863 Sell
20-DMA   69.34 Buy
50-DMA   70.01 Buy
100-DMA   69.18 Buy
200-DMA   67.27 Buy
STOCH(5,3)   13.410 Buy
MACD(12,26,9)   -1.671 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1312/EUR, high of US$1.1312/EUR and settled the day up by 0.777% to close at US$1.1401/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 1.1340-1.1290 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     1.1300
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   36.645 Buy
20-DMA   1.1481 Sell
50-DMA   1.1580 Sell
100-DMA   1.1597 Sell
200-DMA   1.1878 Sell
STOCH(5,3)   28.396 Sell
MACD(12,26,9)   -0.0057 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2763/GBP, high of US$1.3034/GBP and settled the day up by 1.762% to close at US$1.2993/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 1.3000-1.3150 with targets at 1.2950-1.2900 and 1.2840-1.2790-1.2750. Buy above 1.2950-1.2750 with targets 1.3000-1.3060 and 1.3100-1.3150 with stop loss closing below 1.2750.

 
Intraday Support Levels
S1     1.2950-1.2900
S2     1.2840
S3     1.2790-1.2750

Intraday Resistance Levels
R1     1.3000-1.3060
R2     1.3100
R3     1.3150

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

50.790

Buy
20-DMA   1.3002 Buy
50-DMA   1.3018 Buy
100-DMA   1.3039 Buy
200-DMA   1.3455 Buy
STOCH(5,3)   73.660 Sell
MACD(12,26,9)   -0.0052 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY112.59/USD and made an intraday high of JPY113.17/USD and settled the day up by 0.65% at JPY112.64/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 112-115.50 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     113.00
S2     112.10
S3     111.50-111.20

INTRADAY RESISTANCE LEVELS
R1     113.50
R2     114.00
R3     114.70-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.644 Buy
20-DMA   112.65 Sell
50-DMA   112.20 Sell
100-DMA   111.60 Buy
200-DMA   109.83 Buy
STOCH(9,6)   65.228 Buy
MACD(12,26,9)   0.023 Sell

AAFX TRADING
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