AAFX TRADING

Daily Market Lookup

  • Asian shares started the week on the front foot on signs the United States and China were close to striking a tariff deal to end their protracted trade war while the dollar eased as traders wagered Federal Reserve policy would remain accommodative. That followed comments from Trump last week that he had asked China to immediately remove all tariffs on U.S. agricultural products because trade talks were progressing well. He also delayed previously scheduled plans to impose 25 percent tariffs on Chinese goods. Tai listed the prospective Trump-Xi trade summit among such events while China’s National People’s Congress could provide clues on new policies aimed at boosting Asia’s largest economy. March is expected to be a crucial month for global markets with UK parliament voting on Britain’s exit from the European Union while the Fed holds its policy meeting, which could yield clues on plans for future rate hikes and balance sheet reduction. A slew of surveys late last week highlighted the extent of manufacturers’ pain, particularly those exposed to China’s slowdown, and added to expectations that central bank policy tightening is as good as finished. In the United States, ISM data showed manufacturing activity for February dropped to its lowest since November 2016, while the University of Michigan survey showed consumer sentiment fell short of expectations in the month. In addition, a U.S. Commerce Department report showed tame inflation pressures and U.S. personal income falling for the first time in more than three years in January. The modest inflation lends support to the Fed’s patient posture on hiking U.S. interest rates, analysts said./li>
  • BOJ Governor Haruhiko Kuroda said on Monday the central bank would debate and communicate at an appropriate timing an exit plan from its ultra-loose monetary policy. Speaking at the upper house budget committee, Kuroda also underscored the need to watch out for the side effects of prolonged monetary stimulus such as the risks of causing instability in the financial system. Kuroda said the BOJ did not have a specific exit strategy now because it would take “significant time” in achieving its 2% inflation target. But he said an exit from ultra-easy policy would involve a hike in interest rates on excess reserves financial institutions park with the BOJ, and measures to shrink the central bank’s balance sheet. Kuroda also reiterated that the BOJ will “patiently” maintain its massive stimulus program to ensure inflation accelerates toward its 2 percent target. Kuroda has justified nearly six years of monetary stimulus, saying it has helped Japan escape deflation, boost company profits and create almost full employment. When pressed by an opposition lawmaker for comment on the side effects from monetary stimulus, Kuroda said powerful monetary easing could distort the government bond market and disrupt financial intermediation. Speaking at the same parliament session, Prime Minister Shinzo Abe said that he had confidence in Kuroda’s ability to guide monetary policy.
  • The prospect of a full trade deal between the U.S. and China as early as this month helped shore up stocks around Asia but pushed down gold. Gold has lost some of its shine for investors over the past couple of weeks as risk appetites returned, in no small part due to progress in trade negotiations between the U.S. and China. The Wall Street Journal reported that the U.S. could move to lift most or all of its tariffs on Chinese imports and a meeting between Chinese President Xi Jinping and U.S. President Donald Trump to sign a trade deal could happen as early as this month. The news lifted stock markets throughout the region, particularly in China. The appetite for riskier assets pushed down gold and the U.S. dollar, also a safe-haven asset. The U.S. Dollar Index, which tracks the greenback against a basket of other currencies, was also down on Monday morning 0.12% at 96.41.
  • Oil prices rose on Monday, buoyed by output cuts by producer club OPEC and reports that the United States and China are close to a deal to end a bitter tariff row that has slowed global economic growth. The rally followed reports that the United States and China are close to ending their bitter year-long trade dispute. The two countries appear close to a deal that would roll back U.S. tariffs on at least $200 billion worth of Chinese goods, as Beijing makes pledges on structural economic changes and eliminates retaliatory tariffs on U.S. goods, a source briefed on negotiations said on Sunday in Washington. Hopes of an end to the trade spat between the two world's biggest economies added support to a market that has been rallying for the past two months on cuts to production. Supply from the OPEC fell to a four-year low in February, a Reuters survey found, as top exporter Saudi Arabia and its allies over-delivered on the group's supply pact while Venezuelan output registered a further involuntary decline. Oil prices have been further pushed up by U.S. sanctions against OPEC-members Iran and Venezuela, which Barclays bank estimates to have resulted in a reduction of around 2 million bpd in global crude supply. In the United States, there are signs that the oil production boom of the past years, which has seen crude output rise by more than 2 million bpd since early 2018 to more than 12 million bpd, may slow down. U.S. energy firms last week cut the number of oil rigs looking for new reserves to the lowest in almost nine months as some producers follow through on plans to cut spending despite an over 20-percent increase in crude futures so far this year. Despite this, Barclays said "we believe that there could be a repeat performance in the second-half of this year" for U.S. oil output.

 

 
Intraday RESISTANCE LEVELS
4th March 2019 R1 R2 R3
GOLD-XAU 1,300-1,309 1.316 1,325-1,334
Silver-XAG 15.40-15.60 16.00 16.40-17.00
Crude Oil 56.50-57.00 57.50 58.00-59.00
EURO/USD 1.1380 1.1420-1.1460 1.1500
GBP/USD 1.3250-1.3310 1.3350 1.3440-1.3500
USD/JPY 111.90 112.25-112.90 113.50

Intraday SUPPORTS LEVELS
4th March 2019 S1 S2 S3
GOLD-XAU 1,294-1282 1,276 1,267-1.260
Silver-XAG 15.10-14.85 14.50 14.00
Crude Oil 56.00 55.50-55.10 54.30
EURO/USD 1.1330-1.1305 1.1250 1.1210-1.1160
GBP/USD 1.3200 1.3170 1.3120-1.3080
USD/JPY 111.60-111.00 110.60 110.02-109.90

Intra-Day Strategy (4th March 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 Friday made its intraday high of US$1296.20/oz and low of US$1296.20/oz. Gold up by 0.135% at US$1295.32/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1298) and breakage below will call for 1290-1280. MACD is above zero line and histograms are decreasing trend and it will bring downward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; sell below 1300-1334 keeping stop loss closing above 1334, targeting 1294-1282-1276 and 1267-1260. Buy above 1294-1260 with risk below 1260, targeting 1300-1309-1316 and 1323-1334-1342.

 
Intraday Support Levels
S1     1,294-1282
S2     1,276
S3     1,267-1.260
Intraday Resistance Levels
R1     1,300-1,309
R2     1.316
R3     1,325-1,334

Technical Indicators

Name   Value Action
14DRSI  

53.966

Buy
20-DMA   1319.05 Buy
50-DMA  

1298.94

Buy
100-DMA   1262.77 Buy
200-DMA   1247.07 Sell
STOCH(5,3)   18.473 Sell
MACD(12,26,9)   8.260 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$15.25/oz and low of US$15.21/oz. Silver settled down by 0.01% at US$15.23/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 15.10-14.70 targeting 15.90-16.40-17.00 and 17.40-18.00; stop breakage below 14.70. Sell below 15.40-17.00 with stop loss above 17.00; targeting 15.10-14.85-14.50 and 14.00.

 
Intraday  Support Levels
S1     15.10-14.85
S2     14.50
S3     14.00

Intraday  Resistance Levels
R1     15.40-15.60
R2     16.00
R3     16.40-17.00

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 Friday made an intra‐day high of US$57.88/bbl, intraday low of US$55.84/bbl and settled up by 0.232% to close at US$56.02/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 56.00-55.50and 55.10-54.80. Buy above 56.00-54.30 with risk daily closing below 54.30 and targeting 57.50-58.00 and 59.00-59.60.

 
Intraday Support Levels
S1     56.00
S2     55.50-55.10
S3     54.30

Intraday Resistance Levels
R1     56.50-57.00
R2     57.50
R3     58.00-59.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   61.681 Sell
20-DMA   55.28 Sell
50-DMA   52.20 Buy
100-DMA   55.71 Sell
200-DMA   62.31 Sell
STOCH(5,3)   58.916 Sell
MACD(12,26,9)   1.129 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1371/EUR, high of US$1.1395/EUR and settled the day down by 0.01% to close at US$1.1375/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   52.616 Buy
20-DMA   1.1344 Sell
50-DMA   1.1386 Sell
100-DMA   1.1388 Sell
200-DMA   1.1509 Sell
STOCH(5,3)   71.157 Sell
MACD(12,26,9)   -0.008 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.3201/GBP, high of US$1.3374/GBP and settled the day up by 0.211% to close at US$1.3238/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 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 1.3310-1.3500 with targets at 1.3250-1.3170-1.3120 and 1.3080-1.3010. Buy above 1.3250-1.3010 with targets 1.3310-1.3350-1.3400 and 1.3440-1.3500 with stop loss closing below 1.3010.

 
Intraday Support Levels
S1     1.3200
S2     1.3170
S3     1.3120-1.3080

Intraday Resistance Levels
R1     1.3250-1.3310
R2     1.3350
R3     1.3440-1.3500

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

70.507

Buy
20-DMA   1.3012 Sell
50-DMA   1.2908 Buy
100-DMA   1.2887 Sell
200-DMA   1.2994 Sell
STOCH(5,3)   88.972 Buy
MACD(12,26,9)   0.0065 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY110.72/USD and made an intraday high of JPY111.96/USD and settled the day up by 0.044% at JPY111.94/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     111.60-111.00
S2     110.60
S3     110.02-109.90

INTRADAY RESISTANCE LEVELS
R1     111.90
R2     112.25-112.90
R3     113.50

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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