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Daily Market Lookup

  • Asian shares hovered near four-month highs on Tuesday, supported by hopes that Sino-U.S. trade talks were making progress and expectations of policy stimulus from central banks. Investor confidence was bolstered by mild gains in European stocks as U.S. markets were shut on Monday for a public holiday. Chinese shares were little changed, too, with the blue-chip index up 0.1 percent after surging in the previous session. Reports of progress in trade talks between the United States and China have prompted investors to be mildly optimistic that the two countries can reach a compromise by March 1 that will de-escalate their dispute or at least avoid a sharp hike in tariffs, although few details from the talks have emerged. A new round of talks between the United States and China to resolve their trade war will take place in Washington on Tuesday, with follow-up sessions at a higher level later in the week, the White House said on Monday. President Donald Trump said last week he might extend the March 1 deadline, which would stop an immediate increase in tariffs on $200 billion worth of Chinese imports to 25 percent from 10 percent. Reflecting changing sentiment, Chinese shares have risen rapidly so far this month, with MSCI’s China A shares index up 6.5 percent, by far the best performance among major markets despite China’s weakening economy. Additionally, investors are now seen returning to riskier asset markets after the U.S. Federal Reserve signaled earlier this year it could halt rate hikes in light of U.S. economic softness. In currency markets, the euro and other risk-sensitive currencies remained underpinned by hopes on U.S.-China trade talks though most currencies were stuck in familiar ranges. A run of soft European economic data, including Germany’s GDP figures, has weighed on the common currency. Comments from European Central Bank’s Olli Rehn on Sunday have fanned speculation the European Central Bank would launch another round of Targeted Long-Term Refinancing Operations (TLTRO) to support bank lending. Sterling was slightly weaker at $1.2905, with an eye on Brexit talks between Britain and the European Union.
  • A new round of talks between the United States and China to resolve their trade war will take place in Washington on Tuesday, with follow-up sessions at a higher level later in the week, the White House said on Monday. The talks follow a round of negotiations that ended in Beijing last week without a deal but which officials said had generated progress on contentious issues between the world’s two largest economies. The talks are aimed at “achieving needed structural changes in China that affect trade between the United States and China. The two sides will also discuss China’s pledge to purchase a substantial amount of goods and services from the United States,” the White House said in a statement. U.S. tariffs on $200 billion in imports from China are set to rise to 25 percent from 10 percent if no deal is reached by March 1. Trump, who suggested last week that he could extend the deadline for the talks, reiterated in a speech on Monday that the negotiations had been fruitful.
  • The dollar was steady against its peers on Tuesday, lacking strong direction as U.S. markets were shut for a holiday the previous day, while the euro's latest bounce faded as the focus drifted back to the economy and European Central Bank policy. The dollar index versus a basket of six major currencies was nearly flat at 96.881 after ending the previous session unchanged. U.S. financial markets were closed on Monday for Presidents' Day. The single currency had been buoyed by improved investor sentiment as expectations increased for an easing of the U.S.-China trade conflict after both sides reported progress in talks. The dollar, the world's most liquid currency, has tended to perform well during bouts of investor nervousness. ECB policymakers will next meet on March 7, when the bank's staff are expected to slash growth and inflation projections as the euro zone suffers its biggest slowdown in half a decade. Euro zone bond yields, notably those of German bunds, have declined amid the cloudy European economic outlook and weighed on the common currency. The Federal Reserve's recent shift to a dovish tilt was expected to affect ECB monetary policy. RBA Governor Philip Governor Lowe on Feb. 6 had opened the door to a possible rate cut by acknowledging growing economic risks, in a remarkable shift from its long-standing tightening bias that sent the Aussie tumbling.
  • Brent crude oil prices eased away from 2019 highs on Tuesday on caution that economic growth may dent fuel demand this year, although supply cuts led by producer cartel OPEC still meant markets were relatively tight. Traders said the slight downward correction was driven by concerns about the health of the global economy this year. Bank of America Merrill Lynch (NYSE:BAC) said in a note that the Sino-American trade dispute was hurting economic growth globally. China's vice premier and chief trade negotiator, Liu He, and U.S. Trade Representative Robert Lighthizer lead a round of trade talks this week in Washington. Considering the economic outlook and supply and demand balances, the bank said it expects Brent prices to average between $50 and $70 per barrel, "anchored around $60." Despite some caution around trade, global oil markets remain relatively tight because of supply cuts led by the Middle East dominated OPEC, with top crude exporter Saudi Arabia cutting the most. Saudi seaborne crude exports fell in the first half of February, with departures standing at 6.204 million barrels per day (bpd), a 1.341 million bpd decline on the previous month and 0.91 million bpd decline on the year, data intelligence firm Kpler said. Further providing oil markets with support are U.S. sanctions against petroleum exporters Iran and Venezuela. Venezuela is a major crude supplier to U.S. refineries while Iran is a key exporter to major demand centers in Asia, especially China and India.

 

 
Intraday RESISTANCE LEVELS
19th February 2019 R1 R2 R3
GOLD-XAU 1,326 1,334-1.342 1,351
Silver-XAG 15.90 16.40 17.00-17.40
Crude Oil 56.50 57.00-57.30 58.00
EURO/USD 1.1305-1.1330 1.1380 1.1420-1.1460
GBP/USD 1.2910 1.2950-1.3010 1.3090
USD/JPY 110.60 111.00-111.75 112.25

Intraday SUPPORTS LEVELS
19th February 2019 S1 S2 S3
GOLD-XAU 1.316-1,309 1,300 1.296-1.289
Silver-XAG 15.60--15.40 15.10 14.90-14.50
Crude Oil 56.00-55.50 54.80 53.80-53.00
EURO/USD 1.1250-1.1210 1.1160 1.1090
GBP/USD 1.2850-1.2790 1.2750 1.2700-1.2660
USD/JPY 110.02 109.90 109.50-109.10

Intra-Day Strategy (19th 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 Monday made its intraday high of US$1327.58/oz and low of US$1320.48/oz. Gold up by 0.377% at US$1226.10/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1287) and breakage below will call for 1280-1274. 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 1316-1276 with risk below 1274, targeting 1326-1334 and 1342-1351. Sell below 1326-1351 keeping stop loss closing above 1351, targeting 1316-1309-1300 and 1296-1289.

 
Intraday Support Levels
S1     1.316-1,309
S2     1,300
S3     1.296-1.289
Intraday Resistance Levels
R1     1,326
R2     1,334-1.342
R3     1,351

Technical Indicators

Name   Value Action
14DRSI  

65.335

Buy
20-DMA   1310.16 Buy
50-DMA  

1287.11

Buy
100-DMA   1253.46 Buy
200-DMA   1245.88 Sell
STOCH(5,3)   92.473 Buy
MACD(12,26,9)   9.806 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$15.84/oz and low of US$15.74/oz. Silver settled up by 0.126% at US$15.78/oz.

Technicals in Focus:

On daily charts, silver is sustaining above200DMA (15.22), 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 15.60-14.00 targeting 15.90-16.40-17.00 and 17.40-18.00; stop breakage below 14.70. Sell below 15.90-18.00 with stop loss above 18.00; targeting 15.70-15.40 and 15.10-14.80.

 
Intraday  Support Levels
S1     15.60--15.40
S2     15.10
S3     14.90-14.50

Intraday  Resistance Levels
R1     15.90
R2     16.40
R3     17.00-17.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.666 Buy
20-DMA   15.67 Buy
50-DMA   14.89 Buy
100-DMA   14.89 Buy
200-DMA   15.22 Sell
STOCH(5,3)   41.300 Buy
MACD(12,26,9)   0.146 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$56.73/bbl, intraday low of US$56.02/bbl and settled up by 0.338% to close at US$56.36/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 56.50-58.00 with stop loss at 58.00; targeting 56.00-55.50-54.80 and 53.80-53.00-52.50. Buy above 56.00-53.00 with risk daily closing below 53.00 and targeting 56.50-57.00-57.30 and 58.00-58.60.

 
Intraday Support Levels
S1     56.00-55.50
S2     54.80
S3     53.80-53.00

Intraday Resistance Levels
R1     56.50
R2     57.00-57.30
R3     58.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.054 Sell
20-DMA   54.06 Sell
50-DMA   51.34 Buy
100-DMA   56.98 Sell
200-DMA   62.83 Sell
STOCH(5,3)   92.916 Buy
MACD(12,26,9)   1.000 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1288/EUR, high of US$1.1332/EUR and settled the day up by 0.141% to close at US$1.1307/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1405), which become immediate resistance level, break above will target 1.1560-1.1600. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in oversold territory and giving positive crossovers to signal for bullish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider.

Trading Strategy: Neutral to Buy

Buy above 1.1250-1.1090 with risk below 1.1090, targeting 1.1305-1.1330-1.1380 and 1.1460-1.1490. Sell below 1.1305-1.1500 targeting 1.1265-1.1210 and 1.1160-1.1090 with stop-loss at daily closing above 1.1500.

 
Intraday Support Levels
S1     1.1250-1.1210
S2     1.1160
S3     1.1090

Intraday  Resistance Levels
R1     1.1305-1.1330
R2     1.1380
R3     1.1420-1.1460

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.301 Buy
20-DMA   1.1367 Sell
50-DMA   1.1387 Sell
100-DMA   1.1405 Sell
200-DMA   1.1531 Sell
STOCH(5,3)   27.157 Buy
MACD(12,26,9)   -0.003 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.2890/GBP, high of US$1.2938/GBP and settled the day up by 0.155% to close at US$1.2921/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2812) 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 oversold territory and giving negative crossover to confirm bearish 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 1.2900-1.3090 with targets at 1.2850-1.2790-1.2750 and 1.2700-12660. Buy above 1.2900-1.2790 with targets 1.2910-1.2950-1.3010 and 1.3050-1.3090 with stop loss closing below 1.2790.

 
Intraday Support Levels
S1     1.2850-1.2790
S2     1.2750
S3     1.2700-1.2660

Intraday Resistance Levels
R1     1.2910
R2     1.2950-1.3010
R3     1.3090

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

44.816

Buy
20-DMA   1.2997 Sell
50-DMA   1.2812 Buy
100-DMA   1.2889 Sell
200-DMA   1.3021 Sell
STOCH(5,3)   20.972 Sell
MACD(12,26,9)   0.0021 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.43/USD and made an intraday high of JPY110.64/USD and settled the day up by 0.135% at JPY110.58/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (110.42), which is initial 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 111.00-112.25 with risk above 112.25 targeting 110.20-109.90-109.50 and 109.10-108.50. Long positions above 110.20-108.50 with targets of 109.80-110.20 and 110.60-111.00 with stop below 108.50.

 
Intraday Support Levels
S1     110.02
S2     109.90
S3     109.50-109.10

INTRADAY RESISTANCE LEVELS
R1     110.60
R2     111.00-111.75
R3     112.25

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.265 Buy
20-DMA   109.60 Buy
50-DMA   110.42 Buy
100-DMA   111.74 Sell
200-DMA   111.26 Sell
STOCH(9,6)   79.080 Buy
MACD(12,26,9)   0.0392 Buy

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