AAFX TRADING

Daily Market Lookup

  • Asian shares bounced back on Tuesday after two days of losses as U.S. 10-year Treasury yields edged higher, but the outlook remained murky as investors weighed the odds of whether the U.S. economy is in danger of slipping into recession. Investors have been spooked by sharp falls in U.S. bond yields and an inversion of the U.S. Treasury yield curve, which is widely seen as an indicator of an economic recession. It has fallen about 18 basis points since the Federal Reserve last week ditched projections for raising rates this year and announced the end of its balance sheet reduction, citing signs of an economic slowdown. San Francisco Fed researchers have said that the difference in those two maturities was the most useful for forecasting a recession. U.S. economic growth could be “pretty weak” in the first quarter but will likely much closer to 2-2.5 percent for the rest of the year, but a central bank pause is the responsible thing to do, Fed Bank of Boston president and CEO Eric Rosengren said at a conference in Hong Kong. Fed funds rate futures are now fully factoring in a rate cut later this year, with about an 80 percent chance of a move priced in by September. The British pound stood at $1.3195, erasing small gains made after lawmakers voted to wrest control of the Brexit process from Prime Minister Theresa May’s government for a day. May said on Monday there was not yet enough support to put her Brexit deal to a third vote in parliament.
  • The dollar rebounded modestly against the yen on Tuesday as Treasury yields pulled back from 15-month lows as investors reassessed the risks of a sharper downturn in the global economy. The pound stuck to a narrow range with British lawmakers scheduled to vote on a range of Brexit options later in the day. Global markets recoiled on Monday in the wake of an inversion in the U.S. Treasury yield curve, which has signaled a recession in the past. U.S. consumer confidence and housing-related data was due later in the day and could provide near-term cues for the currency market. Euro fell to a 10-day trough of $1.1273 on Monday, also hit by rising concerns about a slowdown in the euro zone economy but made modest gains overnight after a stronger-than-forecast German business confidence survey. Sterling was effectively flat at $1.3197 after spending the previous day confined to a narrow range when British MPs wrested control of the parliamentary agenda from the government for a day in a highly unusual bid to find a way through the Brexit impasse. They will now vote on a range of Brexit options later on Wednesday, giving parliament a chance to indicate whether it can agree on a deal with closer ties to the European Union. The Brexit saga continues after the House of Commons voted 329 to 302 on Monday in the U.K. to take control of the Brexit process from May. Lawmakers are now scheduled to vote on a range of withdrawal options later on Wednesday. Last week, the Brexit date, originally set for 29 March, was postponed by at least two weeks to give May some time to come up with a better Brexit solution. However, May said on Monday that she still lacked support to put her Brexit deal, which was rejected twice earlier this year, to a third vote.
  • Gold prices traded lower on Tuesday in Asia after hitting a one-month high the previous day. The fall in gold prices today came as stock markets and other risky assets recovered from a tumble on Monday. The precious metal received support the previous day after the spreads between U.S. three-month and 10-year Treasury yields modestly inverted and sparked fears of a potential U.S. recession. It got to as high as $1,330.75 during the day. The Brexit saga continues this week after the House of Commons voted 329 to 302 on Monday in the U.K. to take control of the Brexit process from Prime Minister Theresa May. Meanwhile, markets await further news on the Sino-U.S. trade front. high-level officials from China and the U.S. are scheduled to meet later this week in Beijing for a new round of trade talks.
  • Oil prices rose on Tuesday in Asia, but gains were limited as traders remain concerned with a possible recession in the U.S. On Friday, spreads between U.S. three-month and 10-year Treasury yields modestly inverted for the first time since 2007. The inversion appeared after weak factory data from the United States, Europe and Japan. Chicago Federal Reserve Bank President Charles Evans said he understands why the markets become nervous when the yield curve flattens, but believes the U.S. economic growth outlook is still positive. Despite Monday’s pessimism, WTI was on track to end March up more than 3%, while Brent showed a gain of over 1%. Year to date, the U.S crude benchmark has a 29% gain, while its U.K. peer is up almost 24%. Oil prices rallied since the beginning of 2019, helped by OPEC production cuts and a virtual halt in Venezuelan crude exports to the U.S. Huge back-to-back declines of nearly 14 million barrels in U.S. crude stocks over the past two weeks have also provided the oil markets a big sentiment boost. Looking ahead, traders await weekly data on U.S. crude inventories from the American Petroleum Institute that is due later in the day, followed by U.S. Energy Information Administration figures on Wednesday. Analysts expect the data to show U.S. crude inventories falling for a third straight week.

 

 
Intraday RESISTANCE LEVELS
26th March 2019 R1 R2 R3
GOLD-XAU 1,325 1,331-1,338 1,344
Silver-XAG 15.60 16.00 16.40-17.00
Crude Oil 59.50 60.20 61.00-61.64
EURO/USD 1.1330 1.1350 1.1380-1.1430
GBP/USD 1.3200-1.3250 1.3300 1.3350-1.3400
USD/JPY 110.02-110.60 111.00 111.40-111.90

Intraday SUPPORTS LEVELS
26th March 2019 S1 S2 S3
GOLD-XAU 1,316-1,310 1,300 1,294-1,282
Silver-XAG 15.30-15.00 14.75 14.50-14.00
Crude Oil 59.00-58.00 57.50 57.00-56.30
EURO/USD 1.1305-1.1270 1.1250 1.1200-1.1175
GBP/USD 1.3120 1.3075-1.3010 1.2981
USD/JPY 109.55-109.05 108.45 108.00-107.75

Intra-Day Strategy (26th March 2019)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutra
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$1324.44/oz and low of US$1310.95/oz. Gold up by 0.634% at US$1321.75/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1270) and breakage below will call for 1254-1247. 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 neutral 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 1324-1344 keeping stop loss closing above 1344, targeting 1310-1300-1294 and 1282-1276. Buy above 1310-1276 with risk below 1276, targeting1325-1331 and 1338-1346.

 
Intraday Support Levels
S1     1,316-1,310
S2     1,300
S3     1,294-1,282
Intraday Resistance Levels
R1     1,325
R2     1,331-1,338
R3     1,344

Technical Indicators

Name   Value Action
14DRSI  

58.922

Buy
20-DMA   1302.85 Sell
50-DMA  

1307.05

Sell
100-DMA   1276.53 Buy
200-DMA   1247.43 Buy
STOCH(5,3)   81.073 Sell
MACD(12,26,9)   2.648 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$15.56/oz and low of US$15.37/oz. Silver settled up by 0.759% at US$15.52/oz.

Technicals in Focus:

On daily charts, silver is sustaining below200DMA (15.12), breakage above will lead to 15.60. 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 oversold region and giving positive crossover to show upside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 15.30-14.00 targeting 15.60-15.90-16.40 and 17.00-17.40; stop breakage below 14.00. Sell below 15.50-17.00 with stop loss above 17.00; targeting 15.10-14.85-14.50 and 14.00.

 
Intraday  Support Levels
S1     15.30-15.00
S2     14.75
S3     14.50-14.00

Intraday  Resistance Levels
R1     15.60
R2     16.00
R3     16.40-17.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.509 Buy
20-DMA   15.33 Sell
50-DMA   15.55 Sell
100-DMA   15.14 Buy
200-DMA   15.07 Sell
STOCH(5,3)   65.240 Buy
MACD(12,26,9)   -0.0218 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$59.38/bbl, intraday low of US$58.22/bbl and settled up by 0.841% to close at US$59.07/bl.

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 decreasing 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: Neutra

Based on the charts and explanations above; sell below 59.50-61.64 with stop loss at 61.64; targeting 59.00-58.00-57.50 and 57.00-56.30. Buy above 59.00-56.30 with risk daily closing below 56.30 and targeting 59.50-60.20 and 61.00-61.70.

 
Intraday Support Levels
S1     59.00-58.00
S2     57.50
S3     57.00-56.30

Intraday Resistance Levels
R1     59.50
R2     60.20
R3     61.00-61.64

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.547 Sell
20-DMA   57.94 Buy
50-DMA   55.79 Buy
100-DMA   53.89 Buy
200-DMA   61.53 Sell
STOCH(5,3)   39.005 Sell
MACD(12,26,9)   1.131 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1288/EUR, high of US$1.1330/EUR and settled the day up by 0.168% to close at US$1.1312/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1364), 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 negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider.

Trading Strategy: Neutral to Buy

Buy above 1.1305-1.1175 with risk below 1.1170, targeting 1.1330-1.1350 and 1.1380-1.1430. Sell below 1.1330-1.1430 targeting 1.1300-1.1270-1.1250 and 1.1200-1.1175 with stop-loss at daily closing above 1.1430.

 
Intraday Support Levels
S1     1.1305-1.1270
S2     1.1250
S3     1.1200-1.1175

Intraday  Resistance Levels
R1     1.1330
R2     1.1350
R3     1.1380-1.1430

TECHNICAL INDICATORS
Name   Value Action
14DRSI   48.323 Buy
20-DMA   1.1319 Sell
50-DMA   1.1345 Sell
100-DMA   1.1362 Sell
200-DMA   1.1475 Sell
STOCH(5,3)   21.157 Sell
MACD(12,26,9)   -0.009 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.3159/GBP, high of US$1.3245/GBP and settled the day down by 0.126% to close at US$1.3193/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.3063) 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 approaching 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 1.3200-1.3400 with targets at 1.3120-1.3070 and 1.3010-1.2980. Buy above 1.3120-1.2980 with targets 1.3200-1.3250-1.3300and 1.3350-1.3400 with stop loss closing below 1.2950.

 
Intraday Support Levels
S1     1.3120
S2     1.3075-1.3010
S3     1.2981

Intraday Resistance Levels
R1     1.3200-1.3250
R2     1.3300
R3     1.3350-1.3400

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

52.329

Buy
20-DMA   1.3195 Sell
50-DMA   1.3077 Buy
100-DMA   1.2922 Buy
200-DMA   1.2980 Buy
STOCH(5,3)   65.431 Buy
MACD(12,26,9)   0.0072 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY109.70/USD and made an intraday high of JPY110.23/USD and settled the day down by 0.0272% at JPY109.96/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 in oversold territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 110.02-111.90 with risk above 111.90 targeting 109.55-109.05-108.45 and 108.00-107.75. Long positions above 109.50-107.75 with targets of 110.02-110.60-111.00 and 111.40-112.25 with stop below 107.50.

 
Intraday Support Levels
S1     109.55-109.05
S2     108.45
S3     108.00-107.75

INTRADAY RESISTANCE LEVELS
R1     110.02-110.60
R2     111.00
R3     111.40-111.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.964 Buy
20-DMA   111.20 Buy
50-DMA   110.42 Buy
100-DMA   111.22 Sell
200-DMA   111.44 Sell
STOCH(9,6)   17.080 Sell
MACD(12,26,9)   0.0465 Buy

AAFX TRADING
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