AAFX TRADING

Daily Market Lookup

  • Asian stocks rebounded from a 3-1/2-month low on Wednesday as a slight softening in rhetoric from U.S. President Donald Trump eased worries about the U.S.-China tariff war, and on expectations that Beijing could unveil more economic stimulus. Shares in Asia were led by strong gains in Chinese equities, which rebounded after two days of losses The index had fallen to its lowest level since the end of January the previous day as the Sino-U.S. trade conflict intensified. Beijing on Monday imposed a tariff hike on U.S. goods following Washington’s decision last week to hike its levies on Chinese imports. However, Trump on Tuesday said he had a “very good” dialogue with China and insisted talks between the world’s two largest economies had not collapsed. Wall Street shares were able to bounce overnight in wake of Trump’s comments. The Shanghai Composite Index advanced 1.4%, shrugging off concerns about economic growth following weaker-than-expected Chinese data released on Wednesday. China on Wednesday reported surprisingly weaker growth in retail sales and industrial output for April, adding pressure on Beijing to roll out more stimulus as the trade war with the United States escalates. The euro was unchanged at $1.1207 . The common currency had dipped nearly 0.2% the previous day after Italy’s deputy prime minister said the country is ready to break European Union budget rules on debt levels if necessary to spur employment.
  • The dollar was higher in early trading in Europe on Wednesday, supported by comments from senior Federal Reserve officials playing down the likelihood of interest rate cuts, and by a fresh bout of safe-haven buying on geopolitical tensions. The dollar was strongest against the Aussie and kiwi after data published in China showed industrial productionindustrial production and retail sales falling short of expectations in April - even before the imposition of new tariffs on its exports to the U.S. Chinese stocks however rallied on Wednesday, apparently in anticipation of further stimulus from the Chinese central bank. President Donald Trump on Tuesday called on the Federal Reserve to “match” any stimulus provided by China to offset the economic damage from his new tariffs. However, Kansas City Fed President Esther George warned in a speech that “Lower interest rates might fuel asset price bubbles, create financial imbalances, and ultimately a recession,” and put the responsibility for any risk to the U.S. economy on “trade policy uncertainty and slower growth abroad, particularly in China, the euro area, and the United Kingdom.” In a separate appearance, New York Fed President John Williams warned that tariffs would tend to push up inflation. The euro was drifting after news that the German economy grew by 0.4% in the first quarter, a figure that has already been overshadowed by weak business surveys in April and May. A second reading of Eurozone GDP is due later Wednesday. The British pound has lost ground after yesterday’s data showing average earnings growth slowed slightly in March. It’s also still under pressure from domestic pressure, after Labour Party Deputy Leader John McDonnell warned that cross-party talks on a deal to approve Brexit are close to collapse. Prime Minister Theresa May indicated on Tuesday that is aiming for a fourth parliamentary vote on her withdrawal agreement sometime in June. Risk sentiment improved somewhat after U.S. President Donald Trump said that he would meet with his Chinese counterpart Xi Jinping at the upcoming G20 meeting in late June and that he believed trade talks would be “very successful." His comments saw the yuan recover from the lowest levels of the year. The Chinese currency also received some support from reports that the People’s Bank of China stepped in on Tuesday with an injection of 200 billion yuan (approximately $29 billion). The foreign exchange market showed little reaction to worse-than-expected growth in Chinese industrial output and retail sales data for April. Growth in the country’s industrial output slowed to 5.4% in April from a four-and-a-half year high in March, data on Wednesday showed. Analysts had expected industrial output to increase by 6.5%. Fixed-asset investment rose 6.1% in January-April from the same period last year, also lagging expectations. Private-sector fixed-asset investment, which accounts for about 60% of overall investment in China, rose 5.5% in the same period. Retail sales rose 7.2% in April on-year, missed a forecast rise of 8.6%.
  • Oil fell on Wednesday after data showed a surprise rise in U.S. crude stockpiles and as Chinese industrial output grew less than expected in April, but prices were supported by mounting tensions in the Middle East. U.S. crude stockpiles unexpectedly rose last week, while gasoline and distillate inventories increased, data from industry group the American Petroleum Institute showed on Tuesday. Crude inventories climbed by 8.6 million barrels in the week to May 10 to 477.8 million, compared with analyst expectations for a decrease of 800,000 barrels. Crude stocks at the Cushing, Oklahoma, delivery hub rose by 2.1 million barrels, the API said. The U.S. Energy Department's Energy Information Administration (EIA) reports official numbers later on Wednesday. Oil prices have drawn support after Saudi Arabia on Tuesday said armed drones struck two of its oil pumping stations, two days after the sabotage of oil tankers near the United Arab Emirates, while the U.S. military said it was braced for "possibly imminent threats to U.S. forces in Iraq" from Iran-backed forces. The attacks took place against a backdrop of U.S.-Iranian tension following Washington's decision this month to try to cut Iran's oil exports to zero and to beef up its military presence in the Gulf in response to what it said were Iranian threats. Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) on Tuesday said that world demand for its oil would be higher than expected this year as supply growth from rivals including U.S. shale producers slows. That points to a tighter market if the exporter group refrains from raising output. Elsewhere, growth in China's industrial output slowed more than expected to 5.4% in April from a 4-1/2 year high in March, reinforcing views that Beijing will have to roll out more stimulus measures as a trade war with the United States intensifies.

 

 
Intraday RESISTANCE LEVELS
15th May 2019 R1 R2 R3
GOLD-XAU 1,319 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 1.2930-1.2970 1.3010 1.3060-1.3090
USD/JPY 110.00-110.60 111.50 112.00-112.50

Intraday SUPPORTS LEVELS
15th May 2019 S1 S2 S3
GOLD-XAU 1,292-1,286 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 1.2890-1.2850 1.2790 1.2750
USD/JPY 109.55-109.05 108.40 107.70

Intra-Day Strategy (15th 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$1303.25/oz and low of US$1293.67/oz. Gold down by 0.216% at US$1296.81/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 1286-1260 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     1,292-1,286
S2     1,276
S3     1,269-1,260
Intraday Resistance Levels
R1     1,319
R2     1,319
R3     1,328-1,332

Technical Indicators

Name   Value Action
14DRSI  

54.610

Buy
20-DMA   1281.67 Buy
50-DMA  

1291.65

Buy
100-DMA   1296.32 Buy
200-DMA   1255.07 Buy
STOCH(5,3)   74.073 Sell
MACD(12,26,9)   0.452 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$14.84/oz and low of US$14.72/oz. Silver settled up by 0.271% at US$14.77/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   14.88 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 Tuesday made an intra‐day high of US$62.42/bbl, intraday low of US$560.82/bbl and settled up by 0.783% to close at US$61.49/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)   0.341 Sell
MACD(12,26,9)   0.341 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1200/EUR, high of US$1.1243/EUR and settled the day down by 0.161% to close at US$1.1202/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$1.2902/GBP, high of US$1.2969/GBP and settled the day down by 0.408% to close at US$1.2902/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 1.2930-1.3100 with targets at 1.2890-1.2850 and 1.2790-1.2750 stop should be below 1.3300. Buy above 1.2900-1.2750 with targets 1.2930-1.2970-1.3010 and 1.3060-1.3100-1.3150 with stop loss closing below 1.2750.

 
Intraday Support Levels
S1     1.2890-1.2850
S2     1.2790
S3     1.2750

Intraday Resistance Levels
R1     1.2930-1.2970
R2     1.3010
R3     1.3060-1.3090

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

39.772

Buy
20-DMA   1.2987 Buy
50-DMA   1.3071 Sell
100-DMA   1.3011 Buy
200-DMA   1.2957 Buy
STOCH(5,3)   3.996 Sell
MACD(12,26,9)   -0.0011 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY109.13/USD and made an intraday high of JPY109.76/USD and settled the day up by 0.273% at JPY109.59/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

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