AAFX TRADING

Daily Market Lookup

  • Asian stocks slipped on Wednesday as intensifying concerns about global economic growth gripped financial markets, sending Wall Street shares tumbling and driving the safe haven dollar up from a two-week low. U.S. stocks sold off for a second day on Tuesday as energy shares dropped with oil prices, while retailers including Target and Kohl's sank after weak earnings and forecasts, fuelling worries about economic growth. The Nasdaq closed at its lowest in more than seven months on Tuesday while the S&P 500 and Dow ended at their weakest since late October. The recent downturn in global equities has been led in part by a decline in U.S. technology shares, a group which had helped propel Wall Street's long bull market. Earlier in the week, cautious comments by Federal Reserve officials about the global economic outlook knocked the dollar to two-week troughs as they suggested the central bank could slow the pace of or even end its monetary policy tightening cycle.
  • The dollar was flat on Wednesday morning in Asia despite a fall in U.S. stocks overnight. Other major currencies were also mostly unchanged. Although not a directional driver, U.S. President Donald Trump continued to pressure the Federal Reserve on Tuesday, saying rates were "too high." I think we have much more of a Fed problem than we have a problem with anyone else," Trump told reporters outside the White House. Meanwhile, the safe-haven yen traded slightly lower against the dollar, as Japanese investors preferred to keep their money in U.S. and foreign markets, Reuters reported citing analysts. The dollar traded firm against major peers on Wednesday, extending overnight gains as investors shunned riskier assets in favor of safe haven currencies on escalating worries about slowing global growth and the U.S.-Sino trade war. With sentiment souring and a global equities rout on Tuesday, risk averse traders sought shelter in the liquid dollar, which climbed from a two-week low hit earlier on Tuesday. The greenback had been under pressure for most of this week as cautious comments by Federal Reserve officials and surprisingly weak U.S. economic data suggested the central bank could slow the pace of monetary policy tightening. With the Federal Reserve widely expected to raise interest rates by 25 basis points in December, analysts think the greenback could trade with a positive bias in the short term, despite lowering their longer-term rate hike expectations. Despite its safe haven status, the yen's strength has been muted. Analysts suspect this is because Japanese investors have kept their money in U.S. and foreign markets, rather than bring it home. Wider confidence retreated on Tuesday as Italian bank shares hit a two-year low and the spread between German and Italian bond yields widened. Italy is at loggerheads with the European Commission and many fellow euro zone governments over its expansionary 2019 budget, which breaks EU's fiscal rules. The British pound was little changed at $1.2786, having lost 0.5 percent versus the greenback on Tuesday. The pound is seen likely to trade sideways until the market gets more clarity on progress in the Brexit deal.
  • Oil bounced by more than 1 percent on Wednesday to claw back some of the previous day's 6-percent plunge, lifted by a report of an unexpected decline in U.S. commercial crude inventories and record Indian crude imports. But investors remained on edge, with the International Energy Agency (IEA) warning of unprecedented uncertainty in oil markets due to a difficult economic environment and political risk. Wednesday's rebound came after a report by the American Petroleum Institute late on Tuesday that U.S. commercial crude inventories last week fell unexpectedly by 1.5 million barrels, to 439.2 million, in the week to Nov. 16. Record crude imports by India of almost 5 million barrels per day (bpd) also supported prices, traders said Yet Wednesday's bounce did little to reverse overall market weakness, which saw crude tumble by more than 6 percent the previous session amid a selloff in global stock markets. U.S. investment bank Goldman Sachs (NYSE:GS) said on Wednesday the renewed price collapse reflected "concerns over excess supply in 2019... (and) a broader cross-commodity and cross-asset sell-off as growth concerns continue to mount". With output surging and the demand outlook deteriorating, the Organization of the Petroleum Exporting Countries (OPEC) is pushing for a supply cut of between 1 mn and 1.4 mn bpd to prevent a repeat of the 2014 glut. Despite an expectation of OPEC-led cuts, Brent and WTI prices have slumped by 28 and 30 percent respectively since early October, and the entire structure of the forward price curve has changed. The Brent forward curve was in steep backwardation in October, implying a tight market with prices for spot delivery higher than those for later dispatch. This makes it unattractive to store oil. Since then, however, the curve has moved into contango for most of 2019, implying oversupply as higher prices further out make it attractive to store oil for later sale. U.S. crude oil output has jumped by almost a quarter this year, to a record 11.7 million bpd largely because of a surge in shale output.

 

 
Intraday RESISTANCE LEVELS
21st November 2018 R1 R2 R3
GOLD-XAU 1,230-1,238 1,244 1,260
Silver-XAG 14.80 15.10 15.50-16.40
Crude Oil 55.00-56.00 57.00 57.80-58.50
EURO/USD 1.1430 1.1500-1.1560 1.1620
GBP/USD 1.2855 1.2900 1.2950-1.3000
USD/JPY 113.00-113.50 114.00 114.70-115.50

Intraday SUPPORTS LEVELS
21st November 2018 S1 S2 S3
GOLD-XAU 1,221-1,214 1,207 1,200-1,195
Silver-XAG 14.30-14.00 13.61 13.00-12.40
Crude Oil 54.05-53.40 52.80 52.00
EURO/USD 1.1350 1.1300 1.1260-1.1200
GBP/USD 1.2800-1.2780 1.2700 1.2660-1.2600
USD/JPY 112.10 111.50-111.20 110.15

Intra-Day Strategy (21st 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 Tuesday made its intraday high of US$1228.78/oz and low of US$1219.90/oz. Gold down by 0.181% at US$1221.58/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 1214-1238 keeping stop loss closing above 1244, targeting 1214-1200-1195 and 1189-1180. Buy above 1205-1180 with risk below 1180, targeting 1207-1214-1221 and 1238-1244.

 
Intraday Support Levels
S1     1,221-1,214
S2     1,207
S3     1,200-1,195
Intraday Resistance Levels
R1     1,230-1,238
R2     1,244
R3     1,260

Technical Indicators

Name   Value Action
14DRSI  

54.397

Buy
20-DMA   1222.67 Sell
50-DMA  

1212.90

Sell
100-DMA   1213.65 Sell
200-DMA   1262.30 Sell
STOCH(5,3)   92.970 Buy
MACD(12,26,9)   5.120 Buy

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$14.47/oz and low of US$14.21/oz. Silver settled down by 0.763% at US$14.30/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 14.00-12.40 targeting 14.30-14.90-15.10 and 15.60-16.35; stop breakage below 12.40. Sell below 14.30-17.00 with stop loss above 17.00; targeting 13.90-13.50 and 13.00-12.40.

 
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   48.602 Buy
20-DMA   14.43 Sell
50-DMA   14.41 Sell
100-DMA   14.79 Sell
200-DMA   15.65 Sell
STOCH(5,3)   87.367 Sell
MACD(12,26,9)   -0.075 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$57.43/bbl, intraday low of US$52.77/bbl and settled down by 7.02% to close at US$53.32/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 57.80-60.50 with stop loss at 60.50; targeting 57.00-56.00-54.80 and 54.05-53.40. Buy above 57.00-53.40 with risk daily closing below 53.40 and targeting 57.80-58.50 and 59.00-60.50.

 
Intraday Support Levels
S1     54.05-53.40
S2     52.80
S3     52.00

Intraday Resistance Levels
R1     55.00-56.00
R2     57.00
R3     57.80-58.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   26.407 Sell
20-DMA   62.00 Buy
50-DMA   67.75 Buy
100-DMA   68.07 Buy
200-DMA   67.01 Buy
STOCH(5,3)   36.523 Buy
MACD(12,26,9)   -3.420 Buy

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1358/EUR, high of US$1.1471/EUR and settled the day down by 0.72% to close at US$1.1368/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 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 1.1350-1.1160 with risk below 1.1160, targeting 1.1430-1.1490 and 1.1540-1.1610. Sell below 1.1430-1.1620 targeting 1.1350-1.1300-1.1260 and 1.1160-1.1100 with stop-loss at daily closing above 1.1620.

 
Intraday Support Levels
S1     1.1350
S2     1.1300
S3     1.1260-1.1200

Intraday  Resistance Levels
R1     1.1430
R2     1.1500-1.1560
R3     1.1620

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.120 Buy
20-DMA   1.1365 Sell
50-DMA   1.1497 Sell
100-DMA   1.1553 Sell
200-DMA   1.1797 Sell
STOCH(5,3)   70.866 Buy
MACD(12,26,9)   -0.0029 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2775/GBP, high of US$1.2882/GBP and settled the day down by 0.474% to close at US$1.2785/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 1.2855-1.3000 with targets at 1.2780-1.2700 and 2660-1.2600. Buy above 1.2780-1.2600 with targets 1.2880-1.2845-1.2900 and 1.3000-1.3050 with stop loss closing below 1.2600.

 
Intraday Support Levels
S1     1.2800-1.2780
S2     1.2700
S3     1.2660-1.2600

Intraday Resistance Levels
R1     1.2855
R2     1.2900
R3     1.2950-1.3000

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

43.433

Buy
20-DMA   1.2900 Buy
50-DMA   1.3014 Buy
100-DMA   1.3005 Buy
200-DMA   1.3356 Buy
STOCH(5,3)   27.500 Sell
MACD(12,26,9)   -0.0048 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY112.29/USD and made an intraday high of JPY112.83/USD and settled the day up by 0.184% at JPY112.74/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 113.50-115.50 with risk above 115.50 targeting 113.00-112.00-111.50 and 111.20-110.70. Long positions above 113.00-110.70 with targets of 113.50-114.00 and 114.70-115.50 with stop below 110.50.

 
Intraday Support Levels
S1     112.10
S2     111.50-111.20
S3     110.15

INTRADAY RESISTANCE LEVELS
R1     113.00-113.50
R2     114.00
R3     114.70-115.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.046 Buy
20-DMA   112.68 Sell
50-DMA   112.51 Sell
100-DMA   111.81 Buy
200-DMA   109.98 Buy
STOCH(9,6)   88.401 Buy
MACD(12,26,9)   0.278 Sell

AAFX TRADING
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