AAFX TRADING

Daily Market Lookup

  • Asian stocks struggled for traction on Wednesday, as relief over Washington’s temporary relaxation of curbs against China’s Huawei Technologies failed to offset deeper worries about an intensifying trade war between the world’s two largest economies. The Chinese markets, which have endured a volatile few months, were on a cautious note. The Shanghai Composite Index was last a fraction lower. Leaders from G20 nations are scheduled to gather for a summit in Japan at the end of June. The U.S. Commerce Department on Monday granted Huawei Technologies Co Ltd a license to buy U.S. goods until Aug. 19, a move intended to give telecom operators that rely on Huawei time to make other arrangements. But in yet another sign of a deepening divide between the world’s two biggest economies, the New York Times reported on Tuesday that the United States could place limits on Chinese video surveillance firm Hikvision’s ability to buy U.S. technology. Sterling had sunk to a four-month low of $1.2685 on Tuesday on Brexit worries but bounced back after British Prime Minister Theresa May proposed a “new” Brexit deal.
  • The U.S. dollar was hovering near one-month highs against a currency basket on Wednesday, supported by higher U.S. Treasury yields after the U.S. temporarily eased restrictions on Chinese telecommunications giant Huawei. The move came as a reprieve for markets which had been roiled by fears over the escalating trade war between Washington and Beijing but investor sentiment remained subdued as investors monitored the increasing involvement of tech companies in the trade spat. Data overnight showed that Japanese exports fell for the fifth straight month in April, highlighting the threat to the world’s third largest economy from the U.S.-China trade war. Sumitomo Mitsui's Sera said the yen's weakness overnight was thanks to the higher U.S. Treasury yields, which ticked up in response to the recovery in U.S. equities. Eurosceptic parties are widely expected make a strong showing, which could hamper approval of the next European Commission president and budget. The British pound sank to its lowest levels since January, with GBP/USD down 0.3% to 1.2666 after Prime Minister Theresa May’s final attempt to win over support for her Brexit deal fell flat, throwing the country into renewed turmoil over how it will exit the EU. The U.S. dollar was little changed on Wednesday in Asia while the British pound edged up after U.K. Prime Minister Theresa May presented a “new” Brexit deal. It received some support earlier in the day and is currently trading near a one-month high after Federal Reserve Chairman Jerome Powell indirectly argued against cutting interest rates in the near term due to the already-high level of corporate debt. The President did not directly mention the U.S. or the ongoing trade war, but his remarks were widely interpreted as a sign that Beijing is not going to cave in to his U.S. counterpart Donald Trump’s demands anytime soon.
  • Gold prices were largely unchanged on Wednesday in Asia as traders remain cautious amid the latest news on the Sino-U.S. trade front. Bullion reached above the $1,300 mark and hit a one-month peak last Tuesday after China countered higher U.S. tariffs on its goods by announcing duty hikes of its own on American merchandise. In times of both economic and political troubles, investors often seek protection from the safe-haven gold. Sino-U.S. trade tension eased somewhat after the U.S. temporarily lifted curbs on China’s Huawei Technologies, but markets remained on edge as Chinese President Xi Jinping hinted at a domestic tour on Tuesday that the trade war with the U.S. would not end in the near future.
  • Oil prices fell on Wednesday after industry data showed an increase in U.S. crude inventories and as Saudi Arabia pledged to keep markets balanced. However, analysts said oil markets remained tight amid supply cuts led by producer group OPEC and as political tension escalates in the Middle East. The American Petroleum Institute (API) said on Tuesday that U.S. crude stockpiles rose by 2.4 million barrels last week, to 480.2 million barrels, compared with analyst expectations for a decrease of 599,000 barrels. Official data from the U.S Energy Information Administration's oil stockpiles report is due later on Wednesday. Outside the United States, Saudi Arabia on Wednesday said it was committed to a balanced and sustainable oil market. Saudi Arabia has been at the forefront of supply cuts led by the OPEC, of which the kingdom is the de-facto leader, that began in January and are aimed at reducing global oversupply. Because of the cuts, Bank of America Merrill Lynch said crude output by OPEC and its allies fell by 2.3 million barrels per day (bpd) between November 2018 and April 2019. That has helped push up Brent crude prices by more than a third since the start of the year. The bank said some of the impact of the cuts was offset by a slowdown in global oil demand growth due to trade tensions to just 0.7 million bpd in the fourth quarter of 2018 and the first quarter of this year, versus a five-year average of 1.5 million bpd. Beyond market fundamentals, oil traders are looking to the tensions between the United States and Iran. U.S. President Donald Trump on Monday threatened Iran with "great force" if it attacked U.S. interests in the Middle East. On Tuesday, acting U.S. Defense Secretary Patrick Shanahan said threats from Iran remained high. Tensions have risen since Trump re-imposed sanctions on Iranian oil exports to try to strangle the country's economy and force Tehran to halt its nuclear program.

 

 
Intraday RESISTANCE LEVELS
22nd May 2019 R1 R2 R3
GOLD-XAU 1,276-1,284 1,292 1,300-1,309
Silver-XAG 14.50-15.05 15.30 15.60-16.00
Crude Oil 63.00 63.65-64.70 65.50
EURO/USD 1.1200-1.1250 1.1280 1.1330-1.1360
GBP/USD 1.2700-1.2750 1.2780 1.2850-1.2890
USD/JPY 110.60 111.50 112.00-112.50

Intraday SUPPORTS LEVELS
22nd May 2019 S1 S2 S3
GOLD-XAU 1,269-1,260 1,254 1,246
Silver-XAG 14.20 13.90 13.50-13.20
Crude Oil 62.50 62.00 61.20-60.80
EURO/USD 1.1150 1.1100 1.1070-1.1020
GBP/USD 1.2660-1.2600 1.2550 1.2500
USD/JPY 110.00-109.55 109.05 108.40-107.70

Intra-Day Strategy (22nd 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$1277.85/oz and low of US$1269.43/oz. Gold down by 0.231% at US$1274.63/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 1272-1254 with risk below 1254, targeting 1276-1284-1292 and 1300-1309. Sell below 1276-1319 keeping stop loss closing above 1319, targeting 1269-1261 and 1254-1246.

 
Intraday Support Levels
S1     1,269-1,260
S2     1,254
S3     1,246
Intraday Resistance Levels
R1     1,276-1,284
R2     1,292
R3     1,300-1,309

Technical Indicators

Name   Value Action
14DRSI  

40.563

Buy
20-DMA   1282.45 Buy
50-DMA  

1290.21

Buy
100-DMA   1296.53 Buy
200-DMA   14.505 Buy
STOCH(5,3)   14.505 Sell
MACD(12,26,9)   0.316 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$14.46/oz and low of US$14.36/oz. Silver settled up by 0.138% at US$14.43/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 14.20-13.50 targeting 14.50-15.05-15.30 and 15.60-15.90; stop breakage below 13.50. Sell below 14.50-16.00 with stop loss above 16.00; targeting 14.20-13.90 and 13.50-13.20.

 
Intraday  Support Levels
S1     14.20
S2     13.90
S3     13.50-13.20

Intraday  Resistance Levels
R1     14.50-15.05
R2     15.30
R3     15.60-16.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   30.5999 Buy
20-DMA   14.80 Sell
50-DMA   15.05 Sell
100-DMA   15.32 Sell
200-DMA   14.91 Sell
STOCH(5,3)   22.246 Sell
MACD(12,26,9)   -0.129 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$63.75/bbl, intraday low of US$62.77/bbl and settled down by 0.568% to close at US$62.94/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 63.65-66.00 with stop loss at 66.00; targeting 62.60-62.00-61.50 and 60.80-60.10-59.60. Buy above 63.00-59.00 with risk daily closing below 59.00 and targeting 63.65-64.70 and 65.50-66.00.

 
Intraday Support Levels
S1     62.50
S2     62.00
S3     61.20-60.80

Intraday Resistance Levels
R1     63.00
R2     63.65-64.70
R3     65.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.700 Sell
20-DMA   62.55 Buy
50-DMA   61.18 Buy
100-DMA   58.07 Buy
200-DMA   60.32 Buy
STOCH(5,3)   60.130 Sell
MACD(12,26,9)   -0.082 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1141/EUR, high of US$1.1187/EUR and settled the day down by 0.0492% to close at US$1.1159/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 1.1150-1.1020 with risk below 1.1020, targeting 1.1200-1.1230 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     1.1200-1.1250
R2     1.1280
R3     1.1330-1.1360

TECHNICAL INDICATORS
Name   Value Action
14DRSI   42.928 Buy
20-DMA   1.1193 Sell
50-DMA   1.1244 Sell
100-DMA   1.1308 Sell
200-DMA   1.1392 Sell
STOCH(5,3)   16.157 Buy
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.2713/GBP, high of US$1.2765/GBP and settled the day down by 0.047% to close at US$1.2722/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 in oversold territory and giving positive 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 1.2700-1.2890 with targets at 1.2660-1.2600 and 1.2550-1.2500 stop should be below 1.2890. Buy above 1.2660-1.2500 with targets 1.2700-1.2750-1.2850 and 1.2890-1.2930 with stop loss closing below 1.2500.

 
Intraday Support Levels
S1     1.2660-1.2600
S2     1.2550
S3     1.2500

Intraday Resistance Levels
R1     1.2700-1.2750
R2     1.2780
R3     1.2850-1.2890

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

25.947

Buy
20-DMA   1.2925 Buy
50-DMA   1.3029 Sell
100-DMA   1.3013 Buy
200-DMA   1.2954 Buy
STOCH(5,3)   4.996 Buy
MACD(12,26,9)   -0.0011 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY110.00/USD and made an intraday high of JPY110.66/USD and settled the day up by 0.390% at JPY110.48/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 110.00-109.55-109.05 and 108.40-107.70. Long positions above 110.00-107.70 with targets of 110.00-110.60-111.5 and 111.90-112.25 with stop below 107.50.

 
Intraday Support Levels
S1     110.00-109.55
S2     109.05
S3     108.40-107.70

INTRADAY RESISTANCE LEVELS
R1     110.60
R2     111.50
R3     112.00-112.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.871 Buy
20-DMA   110.76 Sell
50-DMA   111.07 Sell
100-DMA   110.49 Buy
200-DMA   111.43 Sell
STOCH(9,6)   74.955 Sell
MACD(12,26,9)   -0.466 Buy

AAFX TRADING
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