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Daily Market Lookup

  • Asian shares fought to sustain the slimmest of recoveries on Friday amid speculation the Federal Reserve might be "one-and-done" with U.S. rate hikes, while oil fell anew as producers bickered over the details of an output cut. There was no escaping concerns over Sino-U.S. relations after the arrest of smartphone maker Huawei Technologies Co Ltd Chief Financial Officer Meng Wanzhou threatened to chill talks on some form of trade truce. Markets also face a test from U.S. payrolls data later in the session amid speculation the economy was heading for a tough patch after years of solid growth. Federal Reserve Chairman Jerome Powell emphasized the strength of the labor market in remarks made late Thursday. Economists polled by Reuters forecast jobs rose by 200,000 in November after surging 250,000 in October. The mood in risk-asset markets brightened a little after the Wall Street Journal reported Fed officials are considering whether to signal a new wait-and-see mentality after a likely rate increase at their meeting in December. That only added to recent feverish speculation the central bank was almost done hiking rates given concerns about global growth and the disinflationary impact of collapsing oil prices Interest rate futures <0#FF:> rallied hard in massive volumes with the market now pricing in less than one hike next year. A month ago they had been wagering on three increases. Treasuries extended their blistering rally, driving 10-year yields down to a three-month trough at 2.8260 percent, before last trading at 2.89 percent. Investors also steamrolled the yield curve to its flattest in over a decade, a trend that has historically presaged economic slowdowns and even recessions The seismic shock spread far and wide. Yields on 10-year paper sank to the lowest in six months in Germany, almost 12 months in Canada and 16 months in Australia.
  • The U.S. dollar was little changed on Thursday while the Chinese yuan fell after the arrest of the CFO of tech giant Huawei Technologies. The U.S. dollar is under pressure this week amid concerns about economic growth following an inversion of the U.S. Treasury yield curve. The two-year/10-year spread was at its flattest this week in more than a decade amid a sharp fall in long-term rates. A flatter curve is seen as an indicator of a slowing economy. The news broke after the U.S. and China agreed to halt the planned increase in tariffs to 25% from 10% on Chinese imports earlier this week. The U.S. dollar was flat on Friday in Asia following reports that the Federal Reserve is considering adopting a wait-and-see approach to rate hikes. The Wall Street Journal reported that the Fed could tighten monetary policy at a slower pace than expected. The news came after Fed chairman Jerome Powell delivered a bullish assessment of the U.S. economy on Thursday. The Fed is expected to raise interest rates again at its Dec. 18-19 meeting, which would be its fourth hike this year. However, traders have reportedly reduced their bets on 2019 rate increases amid stock-market losses and worries over an escalating trade war between the U.S. and China. The USD/JPY pair traded 0.2% higher after the Bank of Japan's (BoJ) Governor Kuroda said in a statement that a rate hike from the US Federal Reserve does not necessarily require a response move from the BoJ. The central bank is watching knock-on risks from trade frictions and Brexit proceedings carefully, he added.
  • Oil prices slipped on Friday morning in Asia, after the meeting of the OPEC in Vienna failed to reach a final decision on cutting output. The OPEC meeting on Thursday failed to announce any output decision, as the oil producers delayed a decision to Friday following a discussion with Russia Russian Energy Minister Alexander Novak flew back to St Petersburg to meet with President Vladimir Putin, and he is expected to return to Vienna on Friday to discuss an output decision with OPEC for the next six months. Crude oil dived more than 3% and Brent crude dropped about 3.5% after the announcement on Thursday. Saudi Arabia’s Energy Minister Khalid al-Falih told journalists before the OPEC meeting that possible output cuts could range from 0.5 to 1.5 million barrels per day (bpd). Uncertainties over the OPEC meeting outcome are further complicated by Iran as it seeks an exemption to output cuts. thanks to U.S. crude sanctions, while Qatar said it would leave the cartel in January Elsewhere, U.S. crude inventories fell by 7.3 million barrels to 443.2 million barrels as of Nov. 30 from last week, the first drop in 11 weeks, according to the Energy Information Administration on Thursday. The country has become a net exporter of oil for the first time in 75 years, according to the New York Times.

 

 
Intraday RESISTANCE LEVELS
7th December 2018 R1 R2 R3
GOLD-XAU 1,238-1,244 1,260 1,266
Silver-XAG 14.80 15.10 15.50-16.40
Crude Oil 52.00-52.80 53.30 54.05-54.90
EURO/USD 1.1430 1.1500 1.1560-1.1600
GBP/USD 1.2760 1.2810 1.2855-1.2900
USD/JPY 113.50-114.00 114.70 115.50-116.00

Intraday SUPPORTS LEVELS
7th December 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 51.00-50.10 49.50 49.00
EURO/USD 1.1350-1.1300 1.1260 1.1205-1.1160
GBP/USD 1.2760-1.2700 1.2660 1.2600-1.2520
USD/JPY 112.70 112.10 111.50-111.00

Intra-Day Strategy (7th December 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$1244.17/oz and low of US$1234.67/oz. Gold up by 0.0282% at US$1237.48/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 1240-1266 keeping stop loss closing above 1266, targeting 1230-1221-1214 and 1200-1195. Buy above 1230-1190 with risk below 1190, targeting 238-1244 and 1250-1260.

 
Intraday Support Levels
S1     1,230
S2     1,221-1,214
S3     1,207
Intraday Resistance Levels
R1     1,238-1,244
R2     1,260
R3     1,266

Technical Indicators

Name   Value Action
14DRSI  

62.731

Buy
20-DMA   1222.70 Sell
50-DMA  

1219.63

Sell
100-DMA   1211.14 Sell
200-DMA   1255.97 Sell
STOCH(5,3)   78.188 Buy
MACD(12,26,9)   4.847 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$14.50/oz and low of US$14.33/oz. Silver settled down by 0.138% at US$14.45/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 oversold region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Neutral

Based on the charts and explanations above, buy above 14.10-12.40 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   49.641 Buy
20-DMA   14.33 Sell
50-DMA   14.44 Sell
100-DMA   14.66 Sell
200-DMA   15.55 Sell
STOCH(5,3)   37.127 Sell
MACD(12,26,9)   -0.075 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$53.344/bbl, intraday low of US$50.22/bbl and settled down by 2.28% to close at US$51.81/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 66.10 which is a resistance level and breakage above will call for 66.80-67.08. 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 52.00-55.40 with stop loss at 55.40; targeting 51.00-50.20 and 49.50-49.00. Buy above 51.00-49.00 with risk daily closing below 49.00 and targeting 52.00-52.80-53.30 and 54.05-54.90.

 
Intraday Support Levels
S1     51.00-50.10
S2     49.50
S3     49.00

Intraday Resistance Levels
R1     52.00-52.80
R2     53.30
R3     54.05-54.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   33.682 Sell
20-DMA   53.59 Buy
50-DMA   62.59 Buy
100-DMA   65.88 Buy
200-DMA   66.40 Buy
STOCH(5,3)   57.563 Buy
MACD(12,26,9)   -3.3316 Buy

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1320/EUR, high of US$1.1411/EUR and settled the day up by 0.282% to close at US$1.1375/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 1.1400-1.1620 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     1.1350-1.1300
S2     1.1260
S3     1.1205-1.1160

Intraday  Resistance Levels
R1     1.1430
R2     1.1500
R3     1.1560-1.1600

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.416 Buy
20-DMA   1.1343 Buy
50-DMA   1.1418 Sell
100-DMA   1.1515 Sell
200-DMA   1.1743 Sell
STOCH(5,3)   46.194 Buy
MACD(12,26,9)   -0.034 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2698/GBP, high of US$1.2811/GBP and settled the day up by 0.392% to close at US$1.2781/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 1.2760-1.3000 with targets at 1.2710-1.2660 and 1.2600-1.2520. Buy above 1.2700-1.2520 with targets 1.2760-1.2810-1.2855 and 1.2900-1.3000 with stop loss closing below 1.2520.

 
Intraday Support Levels
S1     1.2760-1.2700
S2     1.2660
S3     1.2600-1.2520

Intraday Resistance Levels
R1     1.2760
R2     1.2810
R3     1.2855-1.2900

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

45.839

Buy
20-DMA   1.2815 Buy
50-DMA   1.2935 Buy
100-DMA   1.2959 Buy
200-DMA   1.3290 Buy
STOCH(5,3)   45.488 Sell
MACD(12,26,9)   -0.0056 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY112.22/USD and made an intraday high of JPY113.30/USD and settled the day down by 0.450% at JPY112.66/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 114.00-116.00 with risk above 116.00 targeting 113.50-113.00-112.10 and 111.50-111.20. Long positions above 113.50-110.70 with targets of 114.00-114.70 and 115.50-116.00 with stop below 110.50.

 
Intraday Support Levels
S1     112.70
S2     112.10
S3     111.50-111.00

INTRADAY RESISTANCE LEVELS
R1     113.50-114.00
R2     114.70
R3     115.50-116.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.127 Buy
20-DMA   113.30 Sell
50-DMA   113.07 Sell
100-DMA   112.24 Buy
200-DMA   110.54 Buy
STOCH(9,6)   25.179 Buy
MACD(12,26,9)   0.004 Sell

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