AAFX TRADING

Daily Market Lookup

  • Asian stock markets stayed within tight ranges on Friday amid thin holiday trade and as investors awaited the release of key U.S. jobs data and other directional cues. Investors await U.S. employment figures due later in the day, which is forecast to show 185,000 net new jobs were added in April and the unemployment rate steady at 3.8 percent. A report by a payrolls processor on Wednesday showed U.S. private employers added 275,000 jobs last month. A solid official reading would bolster the notion the world’s biggest economy is on track for its longest expansion ever, further boosting the greenback and prospects for corporate earnings. Global policymakers are grappling with tepid wage growth and lukewarm inflation despite a surge in jobs and still strong economic expansion, complicating monetary policy decision-making In the currency markets, Australian and New Zealand dollars fell in early trade as speculators wagered both countries could see interest cuts next week. The weakness in the antipodean currencies also came as the U.S. dollar gained on remarks by U.S. Federal Reserve Chair Jerome Powell earlier this week that a recent weakness in inflation owed to “transitory” factors.
  • The dollar was trying to end the week with a firmer tone on Friday as markets scaled back bets on a U.S. rate cut and some speculated that looming jobs data could surprise on the high side. The dollar has edged higher since Fed Chair Jerome Powell played down the recent slowing in inflation and saw no reason to cut interest rates. The euro was flat at $1.1172, having eased back from a $1.1219 top overnight, though it was still a shade firmer on the week. Eurozone manufacturing surveys released on Thursday showed further contraction in April, but at least got no worse. Interest rate futures imply around a 49 percent chance the Fed would cut rates by December, down from 61 percent late on Wednesday. Yields on two-year Treasuries were up 6 basis points on the week so far. The pricing on rates may change again depending on what the U.S. April jobs report reveals. Forecasts are for payrolls to rise a solid 185,000 with unemployment at 3.8 percent. Analysts at NAB reckon there is a chance of an even stronger number, given the run of leading indicators and the fact that March was held back by poor weather that cleared in April. They are tipping a rise in jobs of 260,000, which would certainly put a spring in the dollar's step. The Commerce Department said factory goods orders increased 1.9% in March year on year, beating economists' expectations for a 1% rise. The U.S. Department of Labor reported Thursday that initial jobless claims remained unchanged at 230,000, missing expectations for a decline of 10,000. An ongoing rise in U.S. government bond yields was cited as supportive for the dollar earlier in the day after Federal Reserve Chairman Jerome Powell dented investor hopes for a rate cut a day earlier. Fed Chair Jerome Powell said at his regular press conference that Fed officials “don’t see a strong case for moving in either direction,” indicating that it believes the weakness of inflation and private demand in the first quarter will be temporary. Nonfarm payrolls probably increased by 185,000 jobs last month after rising 196,000 in March, according to a Reuters survey of economists. Early hiring by the government for the 2020 Census and winter storms in the Midwest are wild cards to the forecast. The anticipated job gains in April would be close to the monthly average of 180,000 in the first quarter and well above the roughly 100,000 needed per month to keep up with growth in the working-age population. Steadily rising wages are keeping workers in the labor force and drawing back those who had dropped out. Average hourly earnings are forecast to have risen 0.3 percent in April after edging up 0.1 percent in March. That would lift the annual increase in wages to 3.3 percent from 3.2 percent in March. Though wage growth is not strong enough to drive up inflation, it is seen sufficient to underpin economic growth as the stimulus from last year’s $1.5 trillion tax cut wanes. The economy grew at a 3.2 percent annualized rate in the first quarter, driven by a surge in exports and inventories, quickening from the October-December period’s 2.2 percent pace. The unemployment rate is expected to have held steady at 3.8 percent in April as more people searched for work. The jobless rate, around the lowest in nearly 50 years, is close to the 3.7 percent that Fed officials project it will be by the end of the year. Economists say there has been a reduction in the number of people collecting disability benefits, testament to the labor market’s strength.
  • Oil prices on Friday were set to fall for the week as surging U.S. output and an expected supply increase from the Organization of the Petroleum Exporting Countries (OPEC) weighed on markets. U.S. crude oil production reached a record 12.3 million barrels per day (bpd) last week, rising by around 2 million bpd over the past year. U.S. crude exports broke through 3 million bpd for the first time this year, according to data from the Energy Information Administration. Traders said prices also fell as Russia started sending clean oil through a pipeline towards western Europe, after several countries last week halted imports because of contamination. In Poland, the government released strategic reserves to ensure supply. Rising U.S. oil production has helped offset some of the disruptions from U.S. sanctions against Iran and Venezuela, and from supply cuts led by the Middle East-dominated OPEC, which started in January. Despite these disruptions and sharp oil price rises in the first months of this year, some analysts say the long-term price risk to crude oil is skewed to the downside. Erik Norland, senior economist at commodity derivative exchange CME Group (NASDAQ:CME), said "the 130 percent rise in U.S. production due to the shale oil revolution" during the past decade had created a strong and constant downside risk to oil prices, which was visible in exchange trading positions.

 

 
Intraday RESISTANCE LEVELS
3rd May 2019 R1 R2 R3
GOLD-XAU 1,276-1,286 1,294 1,300-1,309
Silver-XAG 14.80-15.05 15.30 15.60-16.00
Crude Oil 62.00-63.00 63.65 64.20-65.00
EURO/USD 1.1175-1.1220 1.1280 1.1330-1.1360
GBP/USD 1.3060-1.3100 1.3210 1.3210
USD/JPY 112.00-112.50 113.00 113.70

Intraday SUPPORTS LEVELS
3rd May 2019 S1 S2 S3
GOLD-XAU 1,269 1,260 1,251-1,244
Silver-XAG 14.50 14.20-13.90 13.50
Crude Oil 61.50 60.80 60.00-59.60
EURO/USD 1.1150 1.1100 1.1070-1.1020
GBP/USD 1.3010-1.2970 1.2920 1.2850-1.2800
USD/JPY 111.50-110.60 110.00 109.55-109.05

Intra-Day Strategy (3rd May 2019)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Thursday made its intraday high of US$1277.97/oz and low of US$1266.21/oz. Gold down by 0.511% at US$1270.43/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1283) 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 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; buy above 1278-1244 with risk below 1244, targeting 1286-1294 and 1300-1309. Sell below 1286-1309 keeping stop loss closing above 1310, targeting 1269-1261 and 1251-1244.

 
Intraday Support Levels
S1     1,269
S2     1,260
S3     1,251-1,244
Intraday Resistance Levels
R1     1,276-1,286
R2     1,294
R3     1,300-1,309

Technical Indicators

Name   Value Action
14DRSI  

39.335

Buy
20-DMA   1284.50 Sell
50-DMA  

1300.00

Sell
100-DMA   1292.74 Buy
200-DMA   1252.08 Buy
STOCH(5,3)   39.073 Sell
MACD(12,26,9)   -5.758 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$14.71/oz and low of US$14.55/oz. Silver settled down by 0.211% at US$14.61/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 negative crossover to show downside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 14.50-13.50 targeting 14.80-15.05-15.30 and 15.60-15.90; stop breakage below 13.50. Sell below 14.80-16.00 with stop loss above 16.00; targeting 14.50-14.20 and 14.00-13.50.

 
Intraday  Support Levels
S1     14.50
S2     14.20-13.90
S3     13.50

Intraday  Resistance Levels
R1     14.80-15.05
R2     15.30
R3     15.60-16.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.142 Buy
20-DMA   15.02 Sell
50-DMA   15.26 Sell
100-DMA   15.31 Buy
200-DMA   14.96 Sell
STOCH(5,3)   69.246 Sell
MACD(12,26,9)   -0.0440 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$63.67/bbl, intraday low of US$60.98/bbl and settled down by 3.199% to close at US$61.56/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: Neutral

Based on the charts and explanations above; sell below 62.00-65.60 with stop loss at 65.60; targeting 61.50-60.80 and 60.10-59.60. Buy above 61.50-59.60 with risk daily closing below 59.60 and targeting 62.00-63.00-63.65 and 64.20-65.00.

 
Intraday Support Levels
S1     61.50
S2     60.80
S3     60.00-59.60

Intraday Resistance Levels
R1     62.00-63.00
R2     63.65
R3     64.20-65.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.946 Sell
20-DMA   63.95 Buy
50-DMA   60.71 Buy
100-DMA   56.14 Buy
200-DMA   60.69 Buy
STOCH(5,3)   22.130 Sell
MACD(12,26,9)   0.537 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1175/EUR, high of US$1.1228/EUR and settled the day down by 0.214% to close at US$1.1214/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 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 1.1150-1.1020 with risk below 1.1020, targeting 1.1175-1.1220 and 1.1280-1.1305-1.1350. Sell below 1.1200-1.1360 targeting 1.1175-1.1140-1.1100 and 1.1070-1.1020 with stop-loss at daily closing above 1.1020.

 
Intraday Support Levels
S1     1.1150
S2     1.1100
S3     1.1070-1.1020

Intraday  Resistance Levels
R1     1.1175-1.1220
R2     1.1280
R3     1.1330-1.1360

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.804 Buy
20-DMA   1.1226 Sell
50-DMA   1.1267 Sell
100-DMA   1.1326 Sell
200-DMA   1.1413 Sell
STOCH(5,3)   37.157 Sell
MACD(12,26,9)   -0.009 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3017/GBP, high of US$1.3081/GBP and settled the day down by 0.145% to close at US$1.3029/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 200DMA (1.2977) 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 overbought territory and giving positive 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 1.2900-1.3200 with targets at 1.2850-1.2800 and 1.2770-1.2700 and stop should be below 1.3300. Buy above 1.2850-1.2700 with targets 1.2900-1.2970-1.3010 and 1.3060-1.3100 with stop loss closing below 1.2800.

 
Intraday Support Levels
S1     1.3010-1.2970
S2     1.2920
S3     1.2850-1.2800

Intraday Resistance Levels
R1     1.3060-1.3100
R2     1.3210
R3     1.3210

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

53.111

Buy
20-DMA   1.3009 Sell
50-DMA   1.3104 Sell
100-DMA   1.2977 Buy
200-DMA   1.2960 Buy
STOCH(5,3)   81.996 Buy
MACD(12,26,9)   0.0052 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY111.34/USD and made an intraday high of JPY111.66/USD and settled the day down by 0.125% at JPY111.50/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 112.00-113.70 with risk above 113.70 targeting 111.50-111.00-110.60 and 110.10-109.55-109.05. Long positions above 111.50-109.05 with targets of 111.90-12.25 and 113.00-113.70 with stop below 107.50.

 
Intraday Support Levels
S1     111.50-110.60
S2     110.00
S3     109.55-109.05

INTRADAY RESISTANCE LEVELS
R1     112.00-112.50
R2     113.00
R3     113.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.5601 Buy
20-DMA   111.69 Buy
50-DMA   111.36 Buy
100-DMA   110.72 Buy
200-DMA   111.50 Buy
STOCH(9,6)   29.575 Buy
MACD(12,26,9)   0.0864 Buy

AAFX TRADING
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