AAFX TRADING

Daily Market Lookup

  • Asian stocks rose on Monday as hints of progress on the Sino-U.S. trade standoff provided a rare glimmer of optimism in what has been a rough year-end for equities globally. Survey data out of China, however, proved unhelpfully mixed with manufacturing activity contracting for the first time in two years even as the service sector improved. Chinese state media were more reserved, saying Xi hoped the negotiating teams could meet each other half way and reach an agreement that was mutually beneficial. The Wall Street Journal reported the White House was pressing China for more details of on how it might boost U.S. exports and loosen regulations that stifle U.S. firms there. Indeed, Fed fund futures have largely priced out any hike for next year and now imply a quarter point cut by mid-2020. The $15.5 trillion market is heading for its biggest monthly rally in 2-1/2 years. The precipitous drop in yields has undermined the U.S. dollar in recent weeks.
  • The U.S. dollar was flat on Friday morning in Asia as the Japanese yen dipped after U.S. President Donald Trump tweeted over the weekend that trade talks with China are progressing well. The USD/JPY pair gained 0.15% with the yen trading at 110.42. The safe-haven yen was sought-after at the end of the year as investors entered into risk-off mode over concerns of slowing global economic growth, trade tensions between the U.S. and China and volatility in equity markets. The CNY came under pressure Monday as the National Bureau of Statistics released the official Purchasing Managers’ Index, which showed the country’s first manufacturing decline in more than two and a half years. The manufacturing PMI slid to 49.4, with a reading below signalling contraction. U.S. President Donald Trump said in a tweet over the weekend that he “just had a long and very good call with President Xi of China. Deal is moving along very well. If made, it will be very comprehensive, covering all subjects, areas and points of dispute. Big progress being made!” Bloomberg reported that a U.S. government delegation would travel to Beijing in the week of Jan. 7 to hold the first face-to-face trade talks with Chinese officials since Trump and Chinese President Xi Jinping agreed to a 90-day truce during a G20 meeting in Argentina earlier this month.
  • Gold prices edged down on Monday in Asia as U.S. President Donald Trump sent positive signals to ease U.S.-China tensions, undermining the appeal of the safe-haven asset. On Saturday, Trump said in his tweets that negotiations are “moving very well” and “big progress” has been made. He also cited a “very good call” with Chinese President Xi Jinping on Saturday. In response, Xi said both countries are looking for “stable progress.” Widely seen as a safe-haven asset, gold is often used by investors as a hedge against political and financial uncertainty. Despite a small drop, gold prices hovered near a six-month high, well above the $1,280 level, amid uncertainty over U.S.-China trade relations, concerns over an economic slowdown, and a partial government shutdown in the U.S. Entering a new year, market watchers will continue to follow closely the trade talks between China and the U.S. to look for cues, and Congress will reconvene after the holidays to address the partial government shutdown on January 4.
  • Oil prices climbed on the last trading day of the year on Monday, mirroring gains in stock markets, but were on track for the first yearly decline in three years amid lingering concerns of a persistent supply glut. Hints of progress on a possible U.S.-China trade deal helped bolster sentiment, which has been battered by concerns over a weaker global economic outlook. U.S. President Donald Trump said he had a "very good call" with Chinese President Xi Jinping and that a possible trade deal between the United States and China was progressing well. The current downward pressure on oil prices should likely taper off from January, when OPEC-led supply cuts commence, analysts said. Earlier this month, the OPEC and its allies including Russia, agreed to curb output by 1.2 million barrels per day starting in January to clear a supply overhang and prop up prices. While a gentle recovery is expected for prices in the first quarter 2019, the market might still remain under pressure from swelling production in the United States, which has emerged as the world's biggest crude producer this year. U.S. shale production levels would be one of the primary drivers of crude markets going forward, said Benjamin Lu Jiaxuan, commodities analyst at Singapore-based brokerage firm Phillip Futures. The market direction might get dictated if U.S. shale producers disregard bearish signals in oil prices and push for higher output next year, Jiaxuan said. Energy companies in the United States added two oil drilling rigs in the week to Dec. 28, bringing the total count to 885. That was up from 747 a year ago.

 

 
Intraday RESISTANCE LEVELS
31st December 2018 R1 R2 R3
GOLD-XAU 1,282-1.289 1,300 1,309
Silver-XAG 15.40-15.60 16.00 16.40
Crude Oil 46.50-47.00 47.60 48.40-49.00
EURO/USD 46.50-47.00 47.60 48.40-49.00
GBP/USD 1.1460 1.1490 1.1560-1.1600
USD/JPY 1.2700 1.2760 1.2800-1.2850

Intraday SUPPORTS LEVELS
31st December 2018 S1 S2 S3
GOLD-XAU 1,274 1,266-1,260 1,253
Silver-XAG 15.10-14.90 14.75 14.40-14.00
Crude Oil 45.50-45.10 44.50 43.90-43.00
EURO/USD 45.50-45.10 44.50 43.90-43.00
GBP/USD 1.1400-1.1350 1.1300 1.1260-1.1210
USD/JPY 1.2660 1.2600-1.2550 1.2490

Intra-Day Strategy (31st December 2018)
GOLD-XAU Buy on Dips
Silver-XAG Neutral
Crude Oil Neutral
EUR/USD Neutral to Buy
GBP/USD Neutral to Buy
USD/JPY Neutral to Buy

Gold – XAU

AAFX TRADING

Gold on Friday made its intraday high of US$1282.08/oz and low of US$1274.22/oz. Gold up by 0.420% at US$1280.77/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1251) and breakage below will call for 1246-1236. MACD is above zero line and histograms are increasing trend and it will bring upward stance in the upcoming sessions. RSI is in overbought region and more upside 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: Buy on Dips

Based on the charts and explanations above; buy above 1274-1244 with risk below 1244, targeting 1282-1289 and 1300-1309. Sell below 1274-1309 keeping stop loss closing above 1300, targeting 1274-1266-1260 and 1253- 1244.

 
Intraday Support Levels
S1     1,274
S2     1,266-1,260
S3     1,253
Intraday Resistance Levels
R1     1,282-1.289
R2     1,300
R3     1,309

Technical Indicators

Name   Value Action
14DRSI  

72.115

Buy
20-DMA   1248.47 Buy
50-DMA  

1232.89

Buy
100-DMA   1216.28 Buy
200-DMA   1251.24 Sell
STOCH(5,3)   75.002 Sell
MACD(12,26,9)   12.253 Buy

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$15.20/oz and low of US$15.20/oz. Silver settled up by 0.420% at US$15.37/oz.

Technicals in Focus:

On daily charts, silver is sustaining above100DMA (14.50), breakage below will lead to 14.30-13.60. 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 overbought 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 15.10-14.00 targeting 15.40-15.60 and 16.00-16.40.; stop breakage below 14.00. Sell below 15.40-16.40 with stop loss above 16.40; targeting 15.10-14.90-14.75 14.40-13.90.

 
Intraday  Support Levels
S1     15.10-14.90
S2     14.75
S3     14.40-14.00

Intraday  Resistance Levels
R1     15.40-15.60
R2     16.00
R3     16.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   71.401 Buy
20-DMA   14.65 Buy
50-DMA   14.50 Buy
100-DMA   14.49 Buy
200-DMA   15.37 Sell
STOCH(5,3)   89.330 Buy
MACD(12,26,9)   0.174 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$46.28/bbl, intraday low of US$44.42/bbl and settled down by 0.724% to close at US$45.20/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 46.50-49.90 with stop loss at 49.90; targeting 45.50-45.10 and 44.50-43.90-43.00. Buy above 45.50-43.00 with risk daily closing below 43.00 and targeting 46.50-47.20 and 48.10-49.00-49.50.

 
Intraday Support Levels
S1     45.50-45.10
S2     44.50
S3     43.90-43.00

Intraday Resistance Levels
R1     46.50-47.00
R2     47.60
R3     48.40-49.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.061 Sell
20-DMA   49.12 Sell
50-DMA   55.20 Sell
100-DMA   62.57 Buy
200-DMA   15.37 Sell
STOCH(5,3)   89.330 Buy
MACD(12,26,9)   0.174 Buy

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1424/EUR, high of US$1.1472/EUR and settled the day down by 0.105% to close at US$1.1440/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1480), which become immediate resistance level, break below will target 1.1560-1.1600. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral 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 1.1400-1.1210 with risk below 1.1210, targeting 1.1460-1.1490 and 1.1540-1.1610. Sell below 1.1460-1.1600 targeting 1.1400-1.1350-1.1300 and 1.1260-1.1210 with stop-loss at daily closing above 1.1600.

 
Intraday Support Levels
S1     45.50-45.10
S2     44.50
S3     43.90-43.00

Intraday  Resistance Levels
R1     46.50-47.00
R2     47.60
R3     48.40-49.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.061 Sell
20-DMA   49.12 Sell
50-DMA   55.20 Sell
100-DMA   62.57 Sell
200-DMA   65.30 Sell
STOCH(5,3)   65.049 Buy
MACD(12,26,9)   -2.907 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2634/GBP, high of US$1.2707/GBP and settled the day up by 0.458% to close at US$1.2699/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 1.2660-1.2900 with targets at 1.2600-1.2600 and 1.2550-1.2490. Buy above 1.2660-1.2490 with targets 1.2700-1.2760-1.2800 and 1.2850-1.2900 with stop loss closing below 1.2490.

 
Intraday Support Levels
S1     1.1400-1.1350
S2     1.1300
S3     1.1260-1.1210

Intraday Resistance Levels
R1     1.1460
R2     1.1490
R3     1.1560-1.1600

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

53.067

Buy
20-DMA   1.1364 Buy
50-DMA   1.1374 Sell
100-DMA   1.1479 Sell
200-DMA   1.1680 Sell
STOCH(5,3)   53.8155 Sell
MACD(12,26,9)   -0.0031 Buy

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY110.13/USD and made an intraday high of JPY111.05/USD and settled the day down by 0.639% at JPY110.26/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 Buy

Sell below 111.00-114.50 with risk above 114.50 targeting 110.20-109.60 and 109.00-108.50. Long positions above 111.00-108.50 with targets of 111.00-111.50-112.10 and 112.70-113.50 with stop below 108.00.

 
Intraday Support Levels
S1     1.2660
S2     1.2600-1.2550
S3     1.2490

INTRADAY RESISTANCE LEVELS
R1     1.2700
R2     1.2760
R3     1.2800-1.2850

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.693 Buy
20-DMA   1.2663 Sell
50-DMA   1.2803 Sell
100-DMA   1.2890 Sell
200-DMA   1.3199 Sell
STOCH(9,6)   43.611 Sell
MACD(12,26,9)   -0.0083 Sell

AAFX TRADING
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