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  • Fresh U.S.-China tariff war volleys pressured Asian shares on Tuesday, but comments from U.S. President Donald Trump that he expects trade negotiations to be successful aided sentiment. Chinese markets that were pummeled in early trade trimmed losses amid signs of state support. China on Monday announced it would impose higher tariffs on $60 billion of U.S. goods following Washington's decision last week to hike its own levies on $200 billion in Chinese imports. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.9% as volatile Chinese markets paused for their midday break. The index had earlier fallen as much as 1.25% to its lowest since Jan. 30. Providing some support for Asian markets were comments from Trump late on Monday that trade talks with China are "going to be very successful". That helped lift U.S. stock futures more than 0.5%, though sentiment remained fragile. Broader Asian markets were dragged lower by sagging Chinese shares, with the MSCI China index dropping 1.6%. China's blue-chip CSI300 index swung between losses and gains amid signs of possible state support, before finishing the morning session down 0.2%.The U.S. Trade Representative's office on Monday said it planned to hold a public hearing next month on the possibility of imposing duties of up to 25% on a further $300 billion worth of imports from China. The tariff escalation has rattled global markets, even as Trump said he would meet with Chinese President Xi Jinping next month. As investors flocked to safe-haven assets, U.S. Treasury yields remained near six-week lows early on Tuesday, though they moved higher following Trump's comments. Benchmark 10-year Treasury notes last yielded 2.4157% compared with a U.S. close of 2.405% on Monday. After an earlier inversion, U.S. 10-year yields moved higher than those on three-month Treasury bills. A sustained inversion of this part of the yield curve has preceded every U.S. recession in the past 50 years. On Monday, some traders were concerned that China, the largest foreign U.S. creditor, could dump Treasuries to counter the Trump administration's hardening trade stance. But most analysts downplayed such a possibility.
  • The U.S. dollar traded flat against its rivals on Monday, pressured by a rise in the safe-haven yen as Beijing retaliated against Washington's most recent tariff salvo. The tit-for-tar tariff exchange between the United States and China returned, as Beijing announced Monday it was raising tariffs on $60 billion of U.S. products from June 1. The move comes days after Washington escalated the trade tensions with a tariff hike on $200 billion of Chinese products on Friday. Risk-sensitive currencies like the yen and Swiss franc racked up gains against the greenback before pulling back from their highs. GBP/USD fell, as optimism faded that the U.K. government and the the main opposition party may be able to reach a consensus on a way forward to leave the European Union. he Chinese yuan rebounded on Tuesday in Asia following reports that China’s state-backed funds, also known as the “National Team,” have injected cash into the market as an attempt to support local stocks and currency. Citing unnamed sources, the Hong Kong Economic Times reported that China’s National Team intervened and injected funds into the markets, but the report did not provide any further details. The news boosted investor sentiment and Chinese stocks rose immediately following the report, before falling back into the red shortly after. The yuan sank to four-month lows against the greenback overnight after Beijing announced Monday it was raising tariffs on $60 billion of U.S. products from June 1. The move comes days after Washington escalated the trade tensions with a tariff hike on $200 billion of Chinese products on Friday.
  • Oil edged higher as investors weighed an escalating U.S.-China trade war that’s jeopardizing the demand outlook against the risk that geopolitical tension in the Middle East will disrupt crude flows. Another oil tanker was damaged while anchored in the United Arab Emirates, following a spate of attacks on crude carriers on Sunday, adding to an already tense situation in the Persian Gulf. Volatility in oil prices has jumped this month as crude is buffeted by the specter of a full-blown trade war on the demand side, while a combustible Middle East and production disruptions from Norway to Nigeria throw the supply outlook into doubt. U.S. drilling activity and a pending decision by the Organization of Petroleum Exporting Countries and its allies on whether output curbs will be extended beyond June are taking a back seat to the various crises. The U.S. Trade Representative’s office released a list of about $300 billion worth of Chinese goods including children’s clothing, toys, mobile phones and laptops on Monday that the White House has threatened to hit with a 25% tariff. Meanwhile, President Trump said he’ll meet Chinese President Xi at a G-20 summit in Japan in late June. Asian stocks fell Tuesday, although not as much as the drop in U.S. equities on Monday. Commodities including copper and soybeans recovered some of their recent losses. Oil prices received some support today following reports that Saudi Arabia said two of its oil tankers were sabotaged off the coast of the United Arab Emirates in an attempt to undermine the security of crude supplies. A source told CNN Business that the attacks were targeted outside the Strait of Hormuz, dubbed as the “world’s most important oil transit chokepoint” by the U.S. Energy Information Administration It has not been confirmed who was responsible for the reported attacks. In response to the U.S.'s decision to raise the tariff on $200 billion worth of Chinese goods from 10% to 25% last Friday, Beijing announced earlier in the day that a tariff hike on $60 billion U.S. goods such as frozen vegetables and liquified natural gas would become effective on June 1. The intensified trade war between the world’s two biggest economies sent prices of most risk assets lower today. All major markets in Asia reported loss Tuesday morning, with Hong Kong stocks down more than 1,5%.

 

 
Intraday RESISTANCE LEVELS
14th May 2019 R1 R2 R3
GOLD-XAU 1,300-1,309 1,319 1,328-1,332
Silver-XAG 15.05 15.30 15.60-16.00
Crude Oil 62.00-62.50 63.00 63.65-64.70
EURO/USD 1.1250 1.1280 1.1330-1.1360
GBP/USD 1.2970-1.3010 1.3060 1.3090-1.3150
USD/JPY 110.00-110.60 111.50 112.00-112.50

Intraday SUPPORTS LEVELS
14th May 2019 S1 S2 S3
GOLD-XAU 1,294-1,286 1,276 1,269-1,260
Silver-XAG 14.70-14.50 14.20 13.90-13.50
Crude Oil 61.20 60.80 60.00-59.60
EURO/USD 1.1200-1.1150 1.1100 1.1070-1.1020
GBP/USD 1.2930-1.2890 1.2850 1.2790
USD/JPY 109.55-109.05 108.40 107.70

Intra-Day Strategy (14th 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 Monday made its intraday high of US$1301.19/oz and low of US$1281.85/oz. Gold up by 1.029% at US$1299.68/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 1294-1260 with risk below 1260, targeting 1300-1309-1319 and 13289-1332. Sell below 1300-1332 keeping stop loss closing above 1332, targeting 1294-1286-1276 ands 1269-1261.

 
Intraday Support Levels
S1     1,294-1,286
S2     1,276
S3     1,269-1,260
Intraday Resistance Levels
R1     1,300-1,309
R2     1,319
R3     1,328-1,332

Technical Indicators

Name   Value Action
14DRSI  

59.016

Buy
20-DMA   1280.67 Buy
50-DMA  

1291.56

Buy
100-DMA   1295.96 Buy
200-DMA   1254.68 Buy
STOCH(5,3)   80.073 Buy
MACD(12,26,9)   -2.758 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$14.79/oz and low of US$14.60/oz. Silver settled down by 0.101% at US$14.74/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 Monday made an intra‐day high of US$63.43/bbl, intraday low of US$560.76/bbl and settled up by 0.121% to close at US$60.99/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     61.20
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   44.577 Sell
20-DMA   63.29 Buy
50-DMA   61.34 Buy
100-DMA   56.85 Buy
200-DMA   60.48 Buy
STOCH(5,3)   31.130 Sell
MACD(12,26,9)   0.341 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1220/EUR, high of US$1.1262/EUR and settled the day down by 0.08% to close at US$1.1220/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     1.1250
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 Monday made an intra‐day low of US$1.2940/GBP, high of US$1.3039/GBP and settled the day down by 0.273% to close at US$1.2955/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 1.2970-1.3150 with targets at 1.2920-1.2890 and 1.2850-1.2790 stop should be below 1.3300. Buy above 1.2930-1.2790 with targets 1.2970-1.3010-1.3060 and 1.3100-1.3150-1.3210 with stop loss closing below 1.2850.

 
Intraday Support Levels
S1     1.2930-1.2890
S2     1.2850
S3     1.2790

Intraday Resistance Levels
R1     1.2970-1.3010
R2     1.3060
R3     1.3090-1.3150

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

42.772

Buy
20-DMA   1.2996 Buy
50-DMA   1.3078 Sell
100-DMA   1.3009 Buy
200-DMA   1.2957 Buy
STOCH(5,3)   11.996 Sell
MACD(12,26,9)   -0.0011 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY109.01/USD and made an intraday high of JPY109.83/USD and settled the day down by 0.413% at JPY109.29/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     111.50
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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