AAFX TRADING

Daily Market Lookup

  • Asian equities tracked Wall Street’s slide on Wednesday, while investors switched to safe-haven government bonds, driven by fears that global growth will suffer as a potential trade deal between the United States and China appeared to be unraveling. Beijing said on Tuesday that Chinese Vice Premier Liu He will visit Washington on Thursday and Friday for trade talks, setting up a last-ditch bid to salvage a deal that would avoid a sharp increase in tariffs on Chinese goods ordered by U.S. President Donald Trump. The index had climbed to a nine-month peak three weeks ago, buoyed by factors including strong Chinese economic data and views that Sino-U.S. trade negotiations were progressing and would end in a deal. Global stocks had a rocky start to the week after Washington on Monday accused Beijing of backtracking from commitments made during trade negotiations. That followed President Donald Trump’s unexpected statement on Sunday that he would raise tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent. Government bond prices surged and their yields fell sharply as investor panic took a toll on growth asset markets. The Japanese yen, a perceived safe-haven, often gains against its peers in times of market turmoil and political strife.
  • The dollar was marginally lower in early trading in Europe on Wednesday after concerns about the escalating trade war between the U.S. and China caused another day of sharp losses in global stock markets. The risk-off sentiment has been reinforced by Iran’s announcement that it will stop implementing “some commitments” under the UN-approved 2015 nuclear deal, another challenge to U.S. power that comes only three days after North Korea conducted a series of tests of what may have been ballistic missiles. President Hassan Rouhani warned that the Islamic Republic would resume high-level uranium enrichment if the other signatories to the deal - including Russia, China, France and Germany, didn't act to protect its economy from U.S. sanctions within 60 days. The yen rose on the back of data showing a sharp drop in China’s trade surplus in March, with a surprising drop in exports announced alongside a solid increase in most commodity imports. The euro has weathered a sharp downward revision to the EU’s growth forecasts for the year, announced on Tuesday, which had already been prefigured by similar moves from the European Central Bank and national governments. European Central Bank President Mario Draghi is due to speak at 7:30 AM ET (1130 GMT). Sterling remained under pressure after the U.K. confirmed it will take part in the European parliament elections on May 22, a move that effectively admits there will be no deal between the Conservative and Labour parties in the meantime. Growing fears about the impact of a worsening U.S.-Sino trade conflict on global growth kept the safe-haven Japanese yen near recent highs against its peers on Wednesday. The yen in particular has drawn steady support from a flight-to-safety bid in recent days, though moves in foreign exchange markets have been relatively orderly compared with those in equity markets. Financial markets have been rattled this week by renewed tensions in U.S.-China trade relations That started when U.S. President Donald Trump tweeted on Sunday that he would raise tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent by the end of the week and would "soon" target the remaining Chinese imports with tariffs. Top Chinese negotiator Vice Premier Liu He heads to Washington this week for talks, and some investors have seen Trump's threat as a negotiating tactic. On the back of these trade tensions, the greenback has given up about 1.4 percent against the yen, which tends to benefit during geopolitical or financial stress as Japan is the world's biggest creditor nation, since last Friday. The euro zone will rebound next year from a slow-down in 2019 and unemployment will fall further, but inflation is likely to stay at this year's levels and below the European Central Bank's target, the European Commission said on Tuesday.
  • Oil prices stabilized on Wednesday as markets remained relatively tight amid U.S. sanctions on crude exporters Iran and Venezuela. With U.S. sanctions on Iran and Venezuela in place, analysts said global oil markets remained tight. The United States re-imposed sanctions on Iran in November last year, demanding all countries stop importing oil from the country. Iran has said it will defy the sanctions and continue to export oil. Most analysts expect its crude export to fall to little more than 500,000 barrels per day, down from around 1 million bpd in April, as governments largely bow to American pressure. Washington has also slapped sanctions on Venezuelan oil exports, further disrupting crude supply Wednesday's firmer prices partly reversed bigger price falls earlier in the week, which were triggered by announcements from Washington that the United States would this Friday further hike import tariffs on Chinese goods. The U.S. re-imposed sanctions on Iran in November in 2018, demanding all countries stop importing oil from the country. The sanctions have already halved Iranian crude oil exports over the past year to less than 1 million barrels per day, and shipments to customers may drop to as low as 500,000 barrels per day in May as sanctions tighten, analysts say. Regardless of the gains today, oil prices were under pressure earlier this week amid fears that trade negotiations between China and the U.S. could break down after U.S. President Donald Trump announced plans to hike tariffs already in place on $200 billion of Chinese imports.

 

 
Intraday RESISTANCE LEVELS
8th May 2019 R1 R2 R3
GOLD-XAU 1,286 1,294 1,300-1,309
Silver-XAG 15.05 15.30 15.60-16.00
Crude Oil 62.00-62.50 63.00 63.65-64.70
EURO/USD 1.1230 1.1280 1.1330-1.13601.1330-1.1360
GBP/USD 1.3060-1.3090 1.3150 1.3210-1.3250
USD/JPY 110.60-111.50 112.00 112.50-113.00

Intraday SUPPORTS LEVELS
8th May 2019 S1 S2 S3
GOLD-XAU 1,276-1,269 1,260 1,251-1,244
Silver-XAG 14.70-14.50 14.20 13.90-13.50
Crude Oil 61.50 60.80 60.00-59.60
EURO/USD 1.1175-1.1150 1.1100 1.1230
GBP/USD 1.3010 1.2970-1.2920 1.2890
USD/JPY 110.00 109.55-109.05 108.40

Intra-Day Strategy (8th 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 Tuesday made its intraday high of US$1286.03/oz and low of US$1278.15/oz. Gold up by 0.285% at US$1284.26/oz.

Technicals in Focus:

In daily charts, prices are above 200DMA (1253) and breakage below will call for 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 positive crossover to confirm bullish 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     1,276-1,269
S2     1,260
S3     1,251-1,244
Intraday Resistance Levels
R1     1,286
R2     1,294
R3     1,300-1,309

Technical Indicators

Name   Value Action
14DRSI  

47.912

Buy
20-DMA   1282.26 Sell
50-DMA  

1294.29

Sell
100-DMA   1293.81 Sell
200-DMA   1252.59 Buy
STOCH(5,3)   67.073 Buy
MACD(12,26,9)   -5.758 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$14.92/oz and low of US$14.78/oz. Silver settled up by 0.269% at US$14.89/oz.

Technicals in Focus:

On daily charts, silver is sustaining below200DMA (14.94), 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 overbought 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 14.70-13.50 targeting 15.05-15.30 and 15.60-15.90; stop breakage below 13.50. Sell below 14.90-16.00 with stop loss above 16.00; targeting 14.50-14.20 and 14.00-13.50.

 
Intraday  Support Levels
S1     14.70-14.50
S2     14.20
S3     13.90-13.50

Intraday  Resistance Levels
R1     15.05
R2     15.30
R3     15.60-16.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.94 Buy
20-DMA   14.94 Sell
50-DMA   15.15 Sell
100-DMA   15.32 Sell
200-DMA   14.94 Sell
STOCH(5,3)   76.246 Buy
MACD(12,26,9)   -0.0986 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$62.53/bbl, intraday low of US$60.70/bbl and settled up by 0.975% to close at US$61.42/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 62.00-64.70 with stop loss at 64.70; targeting 61.50-60.80 and 60.10-59.60. Buy above 61.50-59.00 with risk daily closing below 59.00 and targeting 62.50-63.00 and 63.65-64.70.

 
Intraday Support Levels
S1     61.50
S2     60.80
S3     60.00-59.60

Intraday Resistance Levels
R1     62.00-62.50
R2     63.00
R3     63.65-64.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.366 Sell
20-DMA   63.65 Buy
50-DMA   61.05 Buy
100-DMA   56.44 Buy
200-DMA   60.58 Buy
STOCH(5,3)   45.130 Buy
MACD(12,26,9)   0.341 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1165/EUR, high of US$1.1217/EUR and settled the day down by 0.0625% to close at US$1.1190/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.1261), which become immediate resistance level, break above will target 1.1325-1.1410. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral 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 1.1175-1.1020 with risk below 1.1020, targeting 1.1200-1.1230 and 1.1280-1.1305-1.1350. Sell below 1.1230-1.1360 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     1.1175-1.1150
S2     1.1100
S3     1.1230

Intraday  Resistance Levels
R1     1.1230
R2     1.1280
R3     1.1330-1.13601.1330-1.1360

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.804 Buy
20-DMA   1.1222 Sell
50-DMA   1.1261 Sell
100-DMA   1.1323 Sell
200-DMA   1.1409 Sell
STOCH(5,3)   50.157 Buy
MACD(12,26,9)   -0.009 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.3038/GBP, high of US$1.3130/GBP and settled the day down by 0.289% to close at US$1.3071/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 200DMA (1.2960) 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 neutral 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 1.3060-1.3250 with targets at 1.3010-1.2970 and 1.2920-1.2890 stop should be below 1.3300. Buy above 1.3010-1.2850 with targets 1.3060-1.3100-1.3150 and 1.3210-1.3250 with stop loss closing below 1.2850.

 
Intraday Support Levels
S1     1.3010
S2     1.2970-1.2920
S3     1.2890

Intraday Resistance Levels
R1     1.3060-1.3090
R2     1.3150
R3     1.3210-1.3250

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

49.283

Buy
20-DMA   1.3015 Buy
50-DMA   1.3097 Sell
100-DMA   1.2996 Buy
200-DMA   1.2959 Buy
STOCH(5,3)   49.996 Sell
MACD(12,26,9)   0.0052 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY110.16/USD and made an intraday high of JPY110./USD and settled the day down by 0.447% at JPY110.22/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (110.64), 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 110.60-113.00 with risk above 113.00 targeting 110.10-109.55 and 109.05-108.40. Long positions above 110.00-108.40 with targets of 110.60-111.50-111.90 and 112.25-113.00 with stop below 107.50.

 
Intraday Support Levels
S1     110.00
S2     109.55-109.05
S3     108.40

INTRADAY RESISTANCE LEVELS
R1     110.60-111.50
R2     112.00
R3     112.50-113.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   30.787 Buy
20-DMA   111.54 Sell
50-DMA   111.33 Sell
100-DMA   110.61 Buy
200-DMA   111.49 Sell
STOCH(9,6)   16.575 Sell
MACD(12,26,9)   -0.200 Buy

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