AAFX TRADING

Daily Market Lookup

  • Asian stocks lost ground on Friday as investors worried about a broadening global economic slowdown, with sentiment not helped by the absence of any positive signs for a resolution in the U.S.-China trade row. Safe-haven government bonds benefited in the face of growing anxiety over the global outlook, with German long-term debt yields falling to their lowest in over two years. The European Commission on Thursday sharply cut its forecasts for euro zone economic growth this year and next, stoking fears a global slowdown is spreading to Europe as businesses and investors grapple with trade frictions. Adding to the gloomy mood, U.S. President Donald Trump said he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal. Trump’s stance rattled investors hoping for a resolution to the months-long trade dispute between the world’s biggest economies. Wall Street shares slumped in response overnight, with the Dow falling 0.9 percent to pull back from a two-month peak scaled midweek on upbeat corporate results.
  • The dollar held near a two-week high on Friday, as demand for safe-haven assets rose on uncertainties about the path of U.S.-China trade negotiations and broader worries about slowing global growth. Such concerns were brought to the fore on Thursday after the European Commission sharply cut its forecasts for euro zone economic growth this year and next on expectations the bloc's largest countries will be held back by global trade tensions and domestic challenges. Investors' anxieties about the global economy were also compounded by comments from U.S. President Donald Trump, who said he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal. The dollar index, a gauge of its value versus six major peers was up by around 0.1 percent at 96.59, sitting just shy of its two-week high. The index has gained for six straight sessions in a row. This was mainly due to a weaker euro, which has around 58 percent weightage in the index, and came despite the Federal Reserve's dovish shift on interest rates last week. The euro was marginally lower at $1.1338, on track to post its fifth straight day of losses. The single currency has been stumbling due to weaker-than-expected growth data out of the euro zone and expectations that the European Central Bank will keep monetary policy accommodative this year. Philip Wee, currency strategist at DBS, thinks it is likely the euro will depreciate below $1.10 this year on Europe's relatively weaker growth and inflation outlook against that of the United States. The United Kingdom is currently on course to leave the European Union on March 29 without a deal unless British Prime Minister Theresa May can convince the bloc to reopen the divorce agreement she reached in November. The U.S. Federal Reserve’s interest rate increase in December likely tipped monetary policy into a restrictive setting that may be pushing the economy farther from one of the Fed’s key goals, James Bullard, president of the St. Louis Federal Reserve Bank, said on Thursday. Bullard said he expects the Fed to miss that inflation target again in 2019, a now-perennial problem that he feels has nicked the central bank’s credibility The proper path of interest rates and the correct assessment of policy has been a topic of intense debate in recent months as the Fed aimed to raise rates to a “neutral” level after a decade of low rates meant to boost the economy Following a December rate increase that was a matter of particular controversy, Bullard is the first Fed official to suggest the central bank had in fact overstepped, and may now be actually curbing growth — and the rate of price increases — even though it does not intend to.
  • Gold prices trade little changed around $1310 on Friday start. The yellow metal rose Thursday after comments from White House advisor raised doubts over the trade deal between the US and China. While overall market pessimism favors the bullion’s further advances, the recent strength of the US Dollar continues to be the drag worth mentioning. The White House Adviser Lawrence Kudlow told Fox news on Thursday that 'sizable distance' remains in US-China trade talk. The report dimmed prospects of a successful trade deal between the world’s two largest economies at the end of the 90-day peace period. In addition to growing uncertainties over the US-China trade deal, fears of global economic slowdown and Brexit also entertains the safe haven traders. The International Monetary Fund (IMF) and the World Economic Forum (WEF) were the first to convey their worries for global economic weakness during late last-month. The same concerns were repeated by major central banks and the European Commission off-late. With the aforementioned catalysts challenging market’s risk sentiment, investors turn to the safety of risk and prefer gold at the time of uncertainty. However, recent strength of the US Dollar, based on pessimism surrounding Eurozone, Brexit and the Australian monetary policy moves, challenges the precious metal’s rise.
  • Oil markets dipped on Friday, dragged down by concerns over a global economic slowdown although supply cuts led by producer club OPEC and U.S. sanctions against Venezuela provided crude with some support. Weighing on financial markets, including crude oil futures, were concerns that trade disputes between the United States and China would remain unresolved, denting global economic growth prospects. U.S. President Donald Trump said on Thursday he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline set by the two countries to achieve a trade deal. If there is no agreement between the world's two biggest economies, Trump has threatened to increase U.S. tariffs on Chinese imports. Another round of talks is scheduled for next week in Beijing Despite this, traders said crude prices were prevented from falling much further by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC), which were introduced late last year and are aimed at tightening the market and propping up prices. As part of these cuts, Saudi Arabia - the world's biggest crude oil exporter and de-facto leader of OPEC - cut its crude output in January by about 400,000 barrels per day (bpd) to 10.24 million bpd, according to OPEC sources. That puts Saudi crude oil production almost 1.7 million bpd below that of the United States, which has been churning out around 11.9 million bpd in late 2018 and early 2019 - up by more than 2 million bpd from a year earlier. Another risk to oil supply comes from Venezuela after the implementation of U.S. sanctions against the OPEC-member's petroleum industry in late January. Analysts expect this move to knock out 300,000-500,000 bpd of exports.

 

 
Intraday RESISTANCE LEVELS
8th February 2019 R1 R2 R3
GOLD-XAU 1,309 1.316 1,326-1,334
Silver-XAG 15.90-16.40 17.00 17.40-18.00
Crude Oil 52.50-53.00 53.80 54.80-55.50
EURO/USD 1.1380-1.1420 1.1460 1.1500-1.1540
GBP/USD 1.2950-1.3010 1.3090-1.3150 1.3090-1.3150
USD/JPY 109.90-110.20 110.60 111.00

Intraday SUPPORTS LEVELS
8th February 2019 S1 S2 S3
GOLD-XAU 1,300-1.296 1.289 1,282-1276
Silver-XAG 15.60 15.40 15.10-14.90
Crude Oil 52.00-51.00 50.40 50.00
EURO/USD 1.1330-1.1305 1.1250 1.1200
GBP/USD 1.2910-1.2850 1.2790 1.2700
USD/JPY 109.50-109.10 108.50 108.00-107.30

Intra-Day Strategy (8th February 2019)
GOLD-XAU Buy on Dips
Silver-XAG Neutral
Crude Oil Neutral
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Thursday made its intraday high of US$1311.86/oz and low of US$1302.71/oz. Gold up by 0.271% at US$1309.73/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 1300-1276 with risk below 1274, targeting 1309-1315-1320 and 1326-1334. Sell below 1309-1334 keeping stop loss closing above 1334, targeting 1300-1296-1289 and 1282-1276.

 
Intraday Support Levels
S1     1,300-1.296
S2     1.289
S3     1,282-1276
Intraday Resistance Levels
R1     1,309
R2     1.316
R3     1,326-1,334

Technical Indicators

Name   Value Action
14DRSI  

59.674

Buy
20-DMA   1300.05 Buy
50-DMA  

1275.58

Buy
100-DMA   1245.07 Buy
200-DMA   1245.85 Sell
STOCH(5,3)   22.473 Sell
MACD(12,26,9)   10.396 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$15.74/oz and low of US$15.63/oz. Silver settled up by 0.383% at US$15.70/oz.

Technicals in Focus:

On daily charts, silver is sustaining above200DMA (15.27), 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 15.60-14.70 targeting 15.90-16.40-17.00 and 17.40-18.00; stop breakage below 14.70. Sell below 16.40-18.00 with stop loss above 18.00; targeting 16.00-15.70-15.40 and 15.10-14.80.

 
Intraday  Support Levels
S1     15.60
S2     15.40
S3     15.10-14.90

Intraday  Resistance Levels
R1     15.90-16.40
R2     17.00
R3     17.40-18.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.013 Buy
20-DMA   15.63 Buy
50-DMA   15.20 Buy
100-DMA   14.82 Buy
200-DMA   15.24 Sell
STOCH(5,3)   9.300 Buy
MACD(12,26,9)   0.146 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$54.42/bbl, intraday low of US$52.02/bbl and settled down by 2.457% to close at US$52.78/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 52.50-55.50 with stop loss at 55.50; targeting 52.00-51.50 and 51.00-50.40-50.00. Buy above 52.00-50.00 with risk daily closing below 50.00 and targeting 52.50-53.00-53.80 and 54.80-55.50.

 
Intraday Support Levels
S1     52.00-51.00
S2     50.40
S3     50.00

Intraday Resistance Levels
R1     52.50-53.00
R2     53.80
R3     54.80-55.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   48.072 Sell
20-DMA   53.30 Sell
50-DMA   50.95 Buy
100-DMA   58.16 Sell
200-DMA   63.36 Sell
STOCH(5,3)   20.916 Sell
MACD(12,26,9)   0.685 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1323/EUR, high of US$1.1369/EUR and settled the day down by 0.184% to close at US$1.1339/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.1475), 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 1.1340-1.1200 with risk below 1.1200, targeting 1.1380-1.1460-1.1490 and 1.1520-1.1570. Sell below 1.1380-1.1540 targeting 1.1340-1.1305 and 1.1265-1.1200 with stop-loss at daily closing above 1.1570.

 
Intraday Support Levels
S1     1.1330-1.1305
S2     1.1250
S3     1.1200

Intraday  Resistance Levels
R1     1.1380-1.1420
R2     1.1460
R3     1.1500-1.1540

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.505 Buy
20-DMA   1.1397 Sell
50-DMA   1.1393 Sell
100-DMA   1.1429 Sell
200-DMA   1.1547 Sell
STOCH(5,3)   7.157 Sell
MACD(12,26,9)   0.0001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2953/GBP, high of US$1.2995/GBP and settled the day up by 0.146% to close at US$1.2949/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 Sell

Based on the charts and explanations above; sell below 1.2950-1.3300 with targets at 1.2940-1.2910 and 1.2850-1.2790. Buy above 1.2900-1.2790 with targets 1.2950-1.3010-1.3050 and 1.3090-1.3150with stop loss closing below 1.2790.

 
Intraday Support Levels
S1     1.2910-1.2850
S2     1.2790
S3     1.2700

Intraday Resistance Levels
R1     1.2950-1.3010
R2     1.3090-1.3150
R3     1.3090-1.3150

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

50.539

Buy
20-DMA   1.2991 Sell
50-DMA   1.2806 Sell
100-DMA   1.2897 Sell
200-DMA   1.3031 Sell
STOCH(5,3)   6.972 Sell
MACD(12,26,9)   -0.0102 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY109.95/USD and made an intraday high of JPY110.08/USD and settled the day down by 0.136% at JPY109.80/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

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.

 
Intraday Support Levels
S1     109.50-109.10
S2     108.50
S3     108.00-107.30

INTRADAY RESISTANCE LEVELS
R1     109.90-110.20
R2     110.60
R3     111.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.035 Buy
20-DMA   109.01 Sell
50-DMA   111.27 Sell
100-DMA   111.99 Buy
200-DMA   111.22 Buy
STOCH(9,6)   70.080 Buy
MACD(12,26,9)   -0.434 Sell

AAFX TRADING
AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING AAFX TRADING