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Daily Market Lookup

  • Asian shares inched towards a five-month high on Wednesday and the dollar hovered near a three-week low after Federal Reserve Chairman Jerome Powell reinforced the U.S. central bank’s shift to a more “patient” approach on policy in the face of a slowing economy. Powell, spelling out the Fed’s approach to an economy that is likely slowing, told U.S. lawmakers on Tuesday it is in “no rush to make a judgment” about further changes to interest rates. In two hours of testimony to the Senate Banking Committee, Powell elaborated on the “conflicting signals” the Fed has tried to decipher in recent weeks, including disappointing data on retail sales and other aspects of the economy that contrast with steady hiring, wage growth, and ongoing low unemployment. More evidence of the hot and cold economy came overnight, with weaker-than-expected U.S. housing data and a rosy consumer confidence report. U.S. homebuilding tumbled to a more than two-year low in December as construction of both single and multi-family housing declined, which overshadowed the rebound in consumer confidence in February after three months of declines In the currency market, the dollar was softer after the Fed chief’s testimony, with its index against major peers dipping more than 0.4 percent to its lowest in three weeks overnight. It recovered a little bit of ground in Asian trade, last trading 0.1 percent higher at 96.120. The British pound vaulted after Prime Minister Theresa May offered lawmakers the chance to vote on delaying Brexit. Investors will be keeping an eye on the U.S.-North Korean summit, which begins in Hanoi later on Wednesday. U.S. President Donald Trump and North Korean leader Kim Jong Un were due to meet for their second summit, betting that their personal relationship can break a stalemate over the North’s nuclear weapons and end more than 70 years of hostility.
  • The Federal Reserve is in “no rush to make a judgment” about further changes to interest rates, Fed Chairman Jerome Powell told U.S. lawmakers on Tuesday as he spelled out the central bank’s approach to an economy that is likely slowing. If anything, Powell’s comments solidified a Fed policy shift last month in which it indicated it would pause a three-year cycle of rate hikes, which had been projected to run well into 2020, until the inflation or growth dynamics change. The flow of new workers into the labor force, for example, has surprised the central bank and means “there is more room to grow,” Powell said. Powell, who has led the Fed for just over a year, faced virtually no pushback from Republicans on the Senate panel, as former Fed chief Janet Yellen had in the past, that the central bank was courting inflation or financial risks by leaving rates too low. U.S. Federal Reserve Board Chairman Jerome Powell testifies at a Senate Banking and Housing and Urban Affairs Committee hearing on "The Semiannual Monetary Policy Report to Congress" on Capitol Hill in Washington, U.S., February 26, 2019. After raising rates four times in 2018, and anticipating further hikes in 2019, the Fed in January switched to a “patient” stance as concerns about the global economy took root, and markets voiced doubts about the U.S. economic recovery. the Fed’s benchmark overnight lending rate currently is within a range of 2.25 percent to 2.50 percent. There was also little said by lawmakers about the Fed’s evolving plan to maintain a balance sheet of perhaps $3.5 trillion, which would be lower than the current $4 trillion but still massive by historical standards. Republican lawmakers generally have pushed the central bank to reduce a financial footprint inflated by crisis-era programs many in the party considered risky. Financial markets were largely unmoved by Powell’s testimony, which was the first of his two hearings this week in Congress. He is due to appear before the House of Representatives Financial Services Committee on Wednesday. Powell told lawmakers that the Fed expected the U.S. economy to grow solidly but at a slower pace this year than the estimated 3 percent growth for 2018, an outlook that was built into the central bank’s policy statement in January. But Tuesday’s hearing did offer a preview of issues the central bank may confront as the 2020 presidential campaign takes shape, and Democrats use their recently-won control of the House to press new economic and political ideas. Amid a growing debate over whether the U.S. government may have far more room to expand its debt than conventional economics might recommend, or whether the Fed’s own balance sheet might help finance a “Green New Deal” of economic and environmental programs, Powell made clear he was among the traditionalists.
  • Oil prices recovered on Wednesday in Asia after losing more than 3% earlier this week when U.S. President Donald Trump tweeted that prices were “getting too high.” Citing an Organization of the Petroleum Exporting Countries (OPEC) source, Reuters reported on Tuesday that the international cartel and its allies planned to stick to their oil supply cuts despite Trump's tweet. The news was cited as supporting oil prices today. "Crude oil has been rising lately, not due to strong growth and rising demand but primarily due to a politically orchestrated cut in production from OPEC and friends," said Ole Hansen, head of commodity strategy at Denmark's Saxo Bank, in a Reuters report. However, Hansen said that the production cut has so far failed to create the "tightness needed to support a continued rally." In December, OPEC and a group of 10 producers outside the cartel, led by Russia, agreed to collectively cut production by a total of 1.2 million barrels per day (bpd) during the first six months of 2019. Top exporter and OPEC's de-facto leader Saudi Arabia recently pledged to cut even more production than the deal called for. Looking ahead, The Energy Information Agency will release its weekly reports on oil and natural gas inventories, production and imports at 10:30 AM ET (15:30 GMT). Oil inventories are likely to grow by 2.84 million barrels, down slightly from a week ago's build of 3.67 million barrels, according to analysts’ forecasts compiled by Investing.com.

 

 
Intraday RESISTANCE LEVELS
27th 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 56.50-57.00 58.00 59.00-59.60
EURO/USD 1.1380 1.1420-1.1460 1.1500
GBP/USD 1.3250-1.3300 1.3350 1.3440
USD/JPY 111.00-111.60 112.25 112.90

Intraday SUPPORTS LEVELS
27th 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 56.00-55.50 55.10 54.80-54.00
EURO/USD 1.1330-1.1305 1.1250 1.1210-1.1160
GBP/USD 1.3220-1.3170 1.3120 1.3080-1.3010
USD/JPY 110.60-110.02 109.90 109.50-109.10

Intra-Day Strategy (27th 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 Tuesday made its intraday high of US$1330.13/oz and low of US$1323.42/oz. Gold down by 0.097% at US$1328.51/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 Tuesday made its intraday high of US$15.92/oz and low of US$15.77/oz. Silver settled up by 0.252% at US$15.90/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 Tuesday made an intra‐day high of US$56.20/bbl, intraday low of US$55.16/bbl and settled by 0.953% to close at US$56.10/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 55.88 which is a resistance level and breakage above will call for 59.60. MACD is above zero line and histograms are in increasing mode will bring bearish stance in the upcoming sessions. The Stochastic Oscillator is in oversold 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 56.50-59.60 with stop loss at 59.60; targeting 56.00-55.50-55.10 and 54.80-54.00-53.40. Buy above 56.00-54.00 with risk daily closing below 54.00 and targeting 56.50-57.00-58.00 and 58.00-59.00-59.60.

 
Intraday Support Levels
S1     56.00-55.50
S2     55.10
S3     54.80-54.00

Intraday Resistance Levels
R1     56.50-57.00
R2     58.00
R3     59.00-59.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.172 Sell
20-DMA   55.08 Sell
50-DMA   51.96 Buy
100-DMA   55.88 Sell
200-DMA   62.38 Sell
STOCH(5,3)   27.916 Sell
MACD(12,26,9)   1.045 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1344/EUR, high of US$1.1402/EUR and settled the day up by 0.272% to close at US$1.1387/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   52.660 Buy
20-DMA   1.1348 Sell
50-DMA   1.1386 Sell
100-DMA   1.1389 Sell
200-DMA   1.1517 Sell
STOCH(5,3)   79.157 Sell
MACD(12,26,9)   -0.008 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3092/GBP, high of US$1.3092/GBP and settled the day up by 1.183% to close at US$1.3250/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 1.3250 -1.3440 with targets at 1.3220-1.3170-1.3120 and 1.3080-1.3010. Buy above 1.3220-1.3010 with targets 1.3250-1.3300 with stop loss closing below 1.3010.

 
Intraday Support Levels
S1     1.3220-1.3170
S2     1.3120
S3     1.3080-1.3010

Intraday Resistance Levels
R1     1.3250-1.3300
R2     1.3350
R3     1.3440

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

67.977

Buy
20-DMA   1.2999 Sell
50-DMA   1.2894 Buy
100-DMA   1.2885 Sell
200-DMA   1.2995 Sell
STOCH(5,3)   88.972 Buy
MACD(12,26,9)   0.0065 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY110.41/USD and made an intraday high of JPY111.07/USD and settled the day down by 0.4322% at JPY110.57/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

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