AAFX TRADING

Daily Market Lookup

  • Asian shares lost steam on Tuesday after scaling a five-month high as investors waited to see if Washington and Beijing can clinch a trade deal, while the pound advanced on hopes UK Prime Minister Theresa May will delay a Brexit deadline. President Donald Trump said on Sunday he would delay a tariff hike on $200 billion of Chinese imports in the clearest sign yet that both sides were making progress in the talks, but he also sounded a note of caution, saying a deal “could happen fairly soon, or it might not happen at all.” Tuesday’s losses in Asian stock markets came as JPMorgan analysts urged investors to “curb some of their enthusiasm” over the trade talks, saying the extension to the deadline was a “foregone conclusion” Elsewhere, Indian markets were battered amid concerns about flaring border tensions between India and Pakistan, both of which have nuclear arms. The broader NSE stock index skidded, the rupee fell and bonds rose in a flight to safety. Chinese shares see-sawed between positive and negative territory after a sharp rally the previous day. Japan’s Nikkei stumbled 0.4 percent as some selling pressure built ahead of the fiscal year-end. Investors were also wary of weakening estimates for current quarter earnings, with Wall Street on Monday expecting a 0.9 percent decline in S&P first-quarter earnings per share compared with expectations for 5.3 percent growth on Jan. 1, according to IBES data from Refinitiv. The news was a relief to investors who had feared Britain would crash out of the European Union without a deal. However, a delay could anger May’s pro-Brexit colleagues who might then support a vote of no confidence in the government, potentially triggering a general election. Markets are now awaiting testimony from U.S. Federal Reserve Chairman Jerome Powell to a U.S. Senate committee on Tuesday, after the central bank last month shifted to a more cautious stance on further interest rate hikes. Investors will also keep an eye on a two-day U.S.-North Korea summit this week where leaders of the two countries will try to reach an agreement on Pyongyang’s pledge to give up its nuclear weapon program.
  • The GBP/USD pair jumped to a four-week high on Tuesday in Asia following a Bloomberg report that said British Prime Minister Theresa May was considering delaying a deadline on Brexit. Citing people familiar with the situation, the report said May is expected to allow her cabinet to discuss extending the deadline beyond March 29 at meeting on Tuesday. The pound strengthened following the news as it gives more time to May to prepare a strategy to stop the U.K. leaving the European Union with no deal next month. Trump said the two sides “are going to have a signing summit” and that they are “getting very very close,” although he cautioned it is possible that the deal "might not happen at all." The yuan received some support on Monday following Trump’s decision to extend a tariff deadline of Chinese goods. Former Federal Reserve chairman Janet Yellen made headlines as she said Trump does not understand the central bank. Looking ahead, traders will focus on a set of data due in the second half of the week for more hints on the health of the global economy, including manufacturing activity figures from China and the U.S. and revised U.S. fourth-quarter gross domestic product figures.
  • Gold prices edged higher on Tuesday in Asia as traders await a batch of key U.S. economic data due later this week. On the data front, traders will be closely monitoring the U.S. fourth-quarter GDP, which is set to be released on Thursday. The release of the report was delayed by the 35-day partial government shutdown. Meanwhile, housing starts and building permits are due on Tuesday, while figures on personal consumption expenditure along with consumer sentiment and manufacturing are scheduled to be released on Friday. Investor sentiment improved this week after U.S. President Donald Trump raised the prospect of a trade deal with China. On Monday, he said the two sides “are going to have a signing summit” and that they are “getting very very close,” although he cautioned it is possible that the deal "might not happen at all." The president also announced a delay in tariffs on Chinese goods over the weekend, citing “substantial progress in trade talks with China.” The news is a double-edged sword for gold: while bigger appetite in riskier assets supports the currencies of emerging countries whose central banks are among the biggest buyers of the metal, the outperformance of 'riskier' assets such as equities could prompt some outflows from safer ones such as gold and bonds. Elsewhere, Federal Reserve Chairman Jerome Powell’s two-day testimony to Congress on the economic outlook and monetary policy, which begins Wednesday, is also expected to be in focus.
  • Oil inched down on Tuesday to extend losses of more than 3 percent from the previous session, easing after U.S. President Donald Trump called on OPEC to rein in its efforts to boost prices. Analysts said the United States, the world's biggest oil consumer, was keen to counter a recent rally in prices driven by major exporters trimming production. Brent prices gained 8.1 percent from Feb. 8 to Feb. 22. Trump on Monday expressed concern about oil prices and repeated his previous calls on the Organization of the Petroleum Exporting Countries (OPEC) to keep prices steady OPEC and some non-affiliated producers such as Russia agreed late last year to cut output by 1.2 million barrels per day (bpd) to prevent a large supply overhang from growing. Analysts also noted that while Trump is attempting to ease prices lower, sanctions by the United States against oil exporters Iran and Venezuela have contributed to the recent gains and are providing a floor for prices. But when Washington re-imposed sanctions against Iran's oil exports in November, it granted waivers to eight of Tehran's buyers to import some oil for 180 days, which ends in May this year.

 

 
Intraday RESISTANCE LEVELS
26th February 2019 R1 R2 R3
GOLD-XAU 1,334-1.342 1,351 1,358-1,364
Silver-XAG 16.00-16.40 17.00 17.40-18.00
Crude Oil 55.50-56.00 56.50 57.00-58.00
EURO/USD 1.1380 1.1420-1.1460 1.1500
GBP/USD 1.3170-1.3220 1.3250 1.3300
USD/JPY 111.00-111.60 112.25 112.90

Intraday SUPPORTS LEVELS
26th February 2019 S1 S2 S3
GOLD-XAU 1,325 1.316-1,309 1,300
Silver-XAG 15.60--15.40 15.10 14.70
Crude Oil 55.10-54.80 54.00 53.40-53.00
EURO/USD 1.1330-1.1305 1.1250 1.1210-1.1160
GBP/USD 1.3120-1.3080 1.3010 1.2950-1.2910
USD/JPY 110.60-110.02 109.90 109.50-109.10

Intra-Day Strategy (26th 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$1332.47/oz and low of US$1325.06/oz. Gold down by 0.154% at US$1327.07/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 1324-1300 with risk below 1300, targeting 1334-1342-1351 and 1358-1364. Sell below 1334-1364 keeping stop loss closing above 1364, targeting 1324-1316 and 1309-1300.

 
Intraday Support Levels
S1     1,325
S2     1.316-1,309
S3     1,300
Intraday Resistance Levels
R1     1,334-1.342
R2     1,351
R3     1,358-1,364

Technical Indicators

Name   Value Action
14DRSI  

60.389

Buy
20-DMA   1316.96 Buy
50-DMA  

1292.42

Buy
100-DMA   1257.17 Buy
200-DMA   1246.11 Sell
STOCH(5,3)   49.473 Sell
MACD(12,26,9)   12.260 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$15.99/oz and low of US$15.83/oz. Silver settled up by 0.0125% at US$15.87/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 15.60-14.70 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 15.90-15.40 and 15.10-14.80.

 
Intraday  Support Levels
S1     15.60--15.40
S2     15.10
S3     14.70

Intraday  Resistance Levels
R1     16.00-16.40
R2     17.00
R3     17.40-18.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.868 Buy
20-DMA   15.81 Buy
50-DMA   15.52 Buy
100-DMA   14.98 Buy
200-DMA   15.20 Sell
STOCH(5,3)   33.300 Sell
MACD(12,26,9)   0.105 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$57.65/bbl, intraday low of US$56.83/bbl and settled down by 2.80% to close at US$55.51/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 55.50-58.00 with stop loss at 58.00; targeting55.10-54.80-54.00 and 53.40-53.00. Buy above 55.10-58.00 with risk daily closing below 58.00 and targeting 55.00-54.00 and 53.40-53.00.

 
Intraday Support Levels
S1     55.10-54.80
S2     54.00
S3     53.40-53.00

Intraday Resistance Levels
R1     55.50-56.00
R2     56.50
R3     57.00-58.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.522 Sell
20-DMA   54.95 Sell
50-DMA   51.81 Buy
100-DMA   56.05 Sell
200-DMA   62.45 Sell
STOCH(5,3)   91.916 Buy
MACD(12,26,9)   1.240 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1327/EUR, high of US$1.1366/EUR and settled the day up by 0.202% to close at US$1.1356/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 1.1330-1.1160 with risk below 1.1160, targeting 1.1380-1.1420-1.1460 and 1.1500. Sell below 1.1380-1.1500 targeting 1.1330-1.1265-1.1210 and 1.1160-1.1090 with stop-loss at daily closing above 1.1500.

 
Intraday Support Levels
S1     1.1330-1.1305
S2     1.1250
S3     1.1210-1.1160

Intraday  Resistance Levels
R1     1.1380
R2     1.1420-1.1460
R3     1.1500

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.133 Buy
20-DMA   1.1359 Sell
50-DMA   1.1384 Sell
100-DMA   1.1393 Sell
200-DMA   1.1517 Sell
STOCH(5,3)   70.157 Sell
MACD(12,26,9)   -0.003 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3044/GBP, high of US$1.3113/GBP and settled the day up by 0.198% to close at US$1.3095/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 1.3090-1.2790 with targets at 1.3010-1.2950-1.2910 and 1.2850-1.2790. Buy above 1.3010-1.2790 with targets 1.3090-1.3120 and 1.3170-1.3220 with stop loss closing below 1.2790.

 
Intraday Support Levels
S1     1.3120-1.3080
S2     1.3010
S3     1.2950-1.2910

Intraday Resistance Levels
R1     1.3170-1.3220
R2     1.3250
R3     1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

59.102

Buy
20-DMA   1.2995 Sell
50-DMA   1.2839 Buy
100-DMA   1.2879 Sell
200-DMA   1.3003 Sell
STOCH(5,3)   92.972 Sell
MACD(12,26,9)   0.0021 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY110.57/USD and made an intraday high of JPY111.22/USD and settled the day up by 0.065% at JPY111.04/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (110.03), 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     110.60-110.02
S2     109.90
S3     109.50-109.10

INTRADAY RESISTANCE LEVELS
R1     111.00-111.60
R2     112.25
R3     112.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.265 Buy
20-DMA   110.07 Buy
50-DMA   110.03 Buy
100-DMA   111.51 Sell
200-DMA   111.30 Sell
STOCH(9,6)   60.080 Buy
MACD(12,26,9)   0.247 Buy

AAFX TRADING
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