AAFX TRADING

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  • U.S. stock futures and Asian shares fell on Monday on growing anxiety over whether the United States and China will be able to salvage a trade deal, after Washington sharply hiked tariffs and Beijing vowed to retaliate. The United States and China appeared at a deadlock over trade negotiations on Sunday as Washington demanded promises of concrete changes to Chinese law and Beijing said it would not swallow any “bitter fruit” that harmed its interests. Investors are bracing for threatened “counter-measures” from China in retaliation for Washington’s tariff increase on Friday on $200 billion worth of Chinese goods. The move followed accusations by U.S. President Donald Trump that Beijing “broke the deal” by reneging on earlier commitments White House economic adviser Larry Kudlow told a Fox News program that China needs to agree to “very strong” enforcement provisions for an eventual deal and said the sticking point was Beijing’s reluctance to put into law changes that had been agreed upon. Kudlow said the U.S. tariffs would remain in place while negotiations continue and there is a “strong possibility” that Trump will meet Chinese President Xi Jinping at a G20 summit in Japan in late June. Others were more pessimistic, noting Washington said it was preparing to raise tariffs on all remaining imports from China, worth approximately $300 billion. Under that scenario, the renminbi was likely to fall between 5%-6% against the U.S. dollar in the coming three months, said Hanson, as a shock absorber to the economic impact of heavier tariffs. China will never surrender to external pressure, the government said on Monday, though stopped short of announcing how Beijing will hit back after Washington renewed its threat to impose tariffs on all Chinese imports in an escalating trade dispute. The trade war between the world’s top two economies jumped up a gear on Friday, with the United States hiking tariffs on $200 billion worth of Chinese goods after President Donald Trump said Beijing “broke the deal” by reneging on earlier commitments made during months of negotiations. Trump also ordered U.S. Trade Representative Robert Lighthizer to begin imposing tariffs on all remaining imports from China, a move that would affect about an additional $300 bn worth of goods. Beijing has vowed to respond to the latest U.S. tariffs, but has announced no details yet. State media also kept up a steady drum beat of strongly-worded commentary on Monday, reiterating that China’s door to talks was always open, but vowing to defend the country’s interests and dignity. Ahead of talks last week, China wanted to delete commitments from a draft agreement that Chinese laws would be changed to enact new policies on issues from intellectual property protection to forced technology transfers. That move dealt negotiations to resolve the trade dispute a major setback. Trump has since defended the tariff hike and said he was in “absolutely no rush” to finalize a deal.
  • The dollar hit a four-month high against the Chinese yuan but was lower against the yen and Swiss franc early Monday in Europe as the worsening trade conflict between the U.S. and China prompted bids for ‘safe-haven’ assets. That was just a little above the three-month low that the pair hit on Friday as a fresh round of U.S. tariffs on Chinese imports came into force. The dollar hit a new four-month high against the yuan of 6.8654 overnight. Over the weekend, President Donald Trump initiated a process to levy 25% tariffs on all remaining untouched Chinese imports, but the two sides continued to negotiate, avoiding an all-out breakdown of the talks. It’s still unclear what form China’s promised retaliation will take. Anthony Kettle, a senior portfolio manager with BlueBay Asset Management, said it was “logical” that any deal to settle the dispute will now be delayed and that global growth in the second quarter could suffer as a result. The dollar index, which measures the greenback against a basket of six major currencies, was at 97.340, effectively unchanged from Friday as weakness against havens was offset by a rise against risk proxies such as the Aussie and loonie. In Europe, there was little on the data or political calendar to move the euro or British pound. Sterling may be buffeted later in the week by more political maneuvering ahead of European Parliament elections in nine days’ time, as poor polling numbers put more pressure on Prime Minister Theresa May to break off talks with the Labour Party on a cross-party deal to deliver Brexit.
  • Oil futures were mixed on Monday, with U.S. crude edging lower, as investors and traders fretted over global economic growth prospects amid a standoff in Sino-U.S. trade talks The trade conflict between the world's top two economies escalated on Friday, with the United States hiking tariffs on $200 billion worth of Chinese goods after President Donald Trump said Beijing "broke the deal" by reneging on earlier commitments made during months of negotiations. The parties appeared at a deadlock over negotiations on Sunday as Washington demanded promises of concrete changes to Chinese law and Beijing said it would not swallow any "bitter fruit" that harmed its interests. The United States and China together accounted for 34% of global oil consumption in the first quarter of 2019, data from the International Energy Agency showed. Separately, in an early indicator of future output, U.S. energy companies last week reduced the number of oil rigs operating for the third time in four weeks. Drillers cut two oil rigs in the week to May 10, bringing the total count down to 805, General Electric (NYSE:GE) Co's Baker Hughes energy services firm said in its closely followed report on Friday. The rig count has declined over the past five months as independent exploration and production companies cut spending on new drilling.

 

 
Intraday RESISTANCE LEVELS
13th 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 62.50 63.00 63.65-64.70
EURO/USD 1.1230 1.1280 1.1330-1.1360
GBP/USD 1.3060-1.3090 1.3150 1.3210-1.3250
USD/JPY 110.00-110.60 112.00-112.50 112.00-112.50

Intraday SUPPORTS LEVELS
13th 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 62.00-61.50 60.80 60.00-59.60
EURO/USD 1.1200-1.1150 1.1100 1.1070-1.1020
GBP/USD 1.3010 1.2970-1.2920 1.2890
USD/JPY 109.55-109.05 108.40 107.70

Intra-Day Strategy (13th 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 Friday made its intraday high of US$1289.37/oz and low of US$1283.10/oz. Gold up by 0.152% at US$1285.81/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 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     1,276-1,269
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  

50.016

Buy
20-DMA   1279.62 Sell
50-DMA  

1291.17

Sell
100-DMA   1294.99 Sell
200-DMA   1253.80 Buy
STOCH(5,3)   59.073 Sell
MACD(12,26,9)   -2.758 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$14.83/oz and low of US$14.72/oz. Silver settled up by 0.292% at US$14.76/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   41.980 Buy
20-DMA   14.88 Sell
50-DMA   15.09 Sell
100-DMA   15.33 Sell
200-DMA   14.93 Sell
STOCH(5,3)   48.246 Sell
MACD(12,26,9)   -0.0986 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$62.24/bbl, intraday low of US$561.49/bbl and settled up by 0.121% to close at US$61.81/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     62.00-61.50
S2     60.80
S3     60.00-59.60

Intraday Resistance Levels
R1     62.50
R2     63.00
R3     63.65-64.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.878 Sell
20-DMA   63.45 Buy
50-DMA   61.24 Buy
100-DMA   56.72 Buy
200-DMA   60.52 Buy
STOCH(5,3)   58.130 Buy
MACD(12,26,9)   0.341 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday made an intraday low of US$1.1210/EUR, high of US$1.1250/EUR and settled the day up by 0.196% to close at US$1.1233/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 1.1200-1.1020 with risk below 1.1020, targeting 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     1.1200-1.1150
S2     1.1100
S3     1.1070-1.1020

Intraday  Resistance Levels
R1     1.1230
R2     1.1280
R3     1.1330-1.1360

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.358 Buy
20-DMA   1.1212 Sell
50-DMA   1.1251 Sell
100-DMA   1.1319 Sell
200-DMA   1.1402 Sell
STOCH(5,3)   69.157 Buy
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2990/GBP, high of US$1.3046/GBP and settled the day up by 0.046% to close at US$1.3002/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

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.

 
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 Friday made intra‐day low of JPY109.46/USD and made an intraday high of JPY110.04/USD and settled the day up by 0.172% at JPY109.95/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 110.00-113.00 with risk above 113.00 targeting 109.55-109.05 and 108.40-107.70. Long positions above 109.55-107.70 with targets of 110.00-110.60-111.5 and 111.90-112.25 with stop below 107.50.

 
Intraday Support Levels
S1     109.55-109.05
S2     108.40
S3     107.70

INTRADAY RESISTANCE LEVELS
R1     110.00-110.60
R2     112.00-112.50
R3     112.00-112.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   27.052 Buy
20-DMA   111.33 Sell
50-DMA   111.26 Sell
100-DMA   110.55 Buy
200-DMA   111.47 Sell
STOCH(9,6)   27.575 Sell
MACD(12,26,9)   -0.303 Buy

AAFX TRADING
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