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Daily Market Lookup

  • Asian shares sank on Wednesday and bonds rallied as investor sentiment soured over growing worries about world growth with trade tensions between Washington and Beijing showing no signs of easing.In an indication U.S. markets will fall again on Wednesday, E-Minis for the S&P 500 were 0.4% lower.Risk aversion has increased globally in recent days as fears of world recession resurfaced amid disappointing macro data in major economies. Wins for eurosceptic parties in EU elections as well as a snap poll in Greece and political turmoil in Austria have added to the gloomy outlook. Italy’s dispute with the European Commission over its budget is also a major overhang for world markets. In Asia, focus remains on the ongoing Sino-U.S. trade war. U.S. President Donald Trump said on Monday that Washington was not ready to make a deal with China yet. At the same time, he pressed Japan to reduce its trade imbalance with the United States.Such concerns have led U.S. 10-year yields to fall about 10 basis points below the 3-month rates, an inversion typically seen as a leading indicator of a recession. German Bund yields are also on a slippery slope. Data this week showed a gauge of U.S. manufacturing activity unexpectedly fell in May from the previous month.That follows earlier disappointing readings on U.S. manufacturing and industrial output, Rands added. Analysts at Citi reckon punitive measures against China’s Huawei and other tech firms, as part of the tariff battle, could undermine global productivity growth. In commodity markets, oil prices were subdued on Wednesday as worries the Sino-U.S. trade war could trigger a global economic downturn dominated, despite the risk of supply shortfall from U.S. floods and political tensions in the Middle East.
  • The dollar managed to hold on to most of its overnight gains on Wednesday after investors scooped up safe-haven assets, including U.S. Treasuries, on lingering fears of a further escalation in the Sino-U.S. trade dispute. Losses in the euro in the previous session also helped support the dollar, as analysts warned of more risks for the single currency on uncertainty surrounding the euro zone economy and the bloc's political future. The dollar held mostly steady even after benchmark 10-year U.S. Treasury yields hit as low as 2.243%, their lowest since September 2017. The greenback's own status as a safe-haven helped amid worries about the trade tensions and Italy's budget policy. The U.S. 10-year yields were last at 2.253%. European Union leaders are set to begin the process of filling a number of top EU posts, from the head of the European Commission to the European Central Bank. Italian Deputy Prime Minister Matteo Salvini, whose far-right League triumphed in European elections on Sunday, said the European Commission could fine Italy 3 billion euros for breaking EU debt and deficit rules, a comment that weighed on the single currency. The Chinese yuan edged down against the U.S. dollar on Wednesday in Asia following reports that Huawei filed new legal action against Washington. The news came in the wake of escalating U.S.-China tensions after Trump hiked tariffs on $200 billion of Chinese goods from 10% to 25%. Beijing hit back by raising tariffs on $60 billion worth of American products. Fears of a prolonged U.S.-China trade war heightened this week after Trump said the U.S. was "not ready" to make a trade deal.The amount of daily net cash injection via reverse repo operations is the biggest since Jan.17, 2019, the report said. The PBOC has injected a net 400 billion yuan so far this week.The report was officially due in mid-April but was delayed partly due to the changes to the criteria used to evaluate countries, a senior Treasury official told reporters Tuesday.
  • Oil prices were down on Wednesday in Asia amid fears that the ongoing trade war between the U.S. and China would affect demand for oil.Amid the lack of other directional drivers, traders today are focusing on the trade tension between the U.S. and China, the world’s biggest oil importers.News on Chinese telecom giant Huawei were in focus after the company filed a lawsuit against the U.S. government and challenged the constitutionality of a U.S. law banning federal agencies from buying its productsThe news came one day after U.S. President Donald Trump said Washington is “not ready for a deal” with China, although he believes an agreement could be reached eventually.Weekly data on U.S. crude inventories are delayed this week due to Monday’s holiday. The American Petroleum Institute will release its figures late Wednesday, while the Energy Information Administration’s report is due Thursday morning. Russia will carefully consider extending its oil output reduction agreement with the Organization of the Petroleum Exporting Countries (OPEC) and other producers, Russian First Deputy Prime Minister Anton Siluanov told Reuters on Wednesda. Moscow will weigh, in particular, the deal's positive effect on oil prices against losses in market share to United States companies, he said. Russia's energy ministry and government will determine their stance on the pact's extension after weighing these pros and cons and the longevity of current market trends, Siluanov said.OPEC, Russia and other producers agreed to cut output by 1.2 million barrels per day (bpd) from January for six months to boost oil prices by reducing global inventories.OPEC and the other producers involved in the supply agreement, an alliance known as OPEC+, are scheduled to meet to discuss extending the pact in Vienna during an OPEC meeting scheduled for June 25 and 26. The meeting, however, may be pushed back to July 3 and 4, two OPEC sources said on May 20.

 

 
Intraday RESISTANCE LEVELS
29th May 2019 R1 R2 R3
GOLD-XAU 1,284 1,292 1,300-1,309
Silver-XAG 14.50-15.05 15.30 15.60-16.00
Crude Oil 59.00-60.00 60.40 60.80-61.20
EURO/USD 1.1200-1.1250 1.1280 1.1330-1.1360
GBP/USD 1.2700-1.2750 1.2780 1.2850-1.2900
USD/JPY 110.00-110.60 111.50 112.00-112.50

Intraday SUPPORTS LEVELS
29th May 2019 S1 S2 S3
GOLD-XAU 1,276 1,269 1,260-1,254
Silver-XAG 14.20 13.90 13.50-13.20
Crude Oil 58.25-57.30 56.50 55.90-55.00
EURO/USD 1.1150-1.1100 1.1070 1.1020-1.0950
GBP/USD 1.2650-1.2600 1.2550 1.2500-1.2450
USD/JPY 109.50 109.05 108.40-107.70

Intra-Day Strategy (29th 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$1286.53/oz and low of US$1276.08/oz. Gold down by 0.446% at US$1279.24/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 1276-1254 with risk below 1254, targeting 1284-1292 and 1300-1309. Sell below 1284-1319 keeping stop loss closing above 1319, targeting 1269-1261 and 1254-1246.

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

Technical Indicators

Name   Value Action
14DRSI  

49.408

Buy
20-DMA   1282.65 Sell
50-DMA  

1289.45

Sell
100-DMA   1296.41 Sell
200-DMA   1257.65 Buy
STOCH(5,3)   50.505 Buy
MACD(12,26,9)   1.70 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$14.59/oz and low of US$14.28/oz. Silver settled up by 0.147% at US$14.33/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 14.50-13.50 targeting 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   35.863 Buy
20-DMA   14.63 Sell
50-DMA   14.93 Sell
100-DMA   15.24 Sell
200-DMA   14.89 Sell
STOCH(5,3)   37.246 Buy
MACD(12,26,9)   -0.126 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$59.58/bbl, intraday low of US$58.67/bbl and settled up by 0.165% to close at US$59.09/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 59.00-61.20 with stop loss at 61.20; targeting 58.25-57.30-56.50 and 55.90-55.00. Buy above 58.25-55.00 with risk daily closing below 55.00 and targeting 59.00-60.00-61.20 and 62.00-62.50.

 
Intraday Support Levels
S1     58.25-57.30
S2     56.50
S3     55.90-55.00

Intraday Resistance Levels
R1     59.00-60.00
R2     60.40
R3     60.80-61.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.027 Sell
20-DMA   61.49 Buy
50-DMA   62.15 Buy
100-DMA   58.50 Buy
200-DMA   60.18 Buy
STOCH(5,3)   26.130 Sell
MACD(12,26,9)   -0.807 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1158/EUR, high of US$1.1197/EUR and settled the day down by 0.303% 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 1.1150-1.0950 with risk below 1.0950, targeting 1.1200-1.1250 and 1.1280-1.1305-1.1350. Sell below 1.1200-1.1360 targeting 1.1100-1.1070 and 1.1020-1.0950 with stop-loss at daily closing above 1.0950.

 
Intraday Support Levels
S1     1.1150-1.1100
S2     1.1070
S3     1.1020-1.0950

Intraday  Resistance Levels
R1     1.1200-1.1250
R2     1.1280
R3     1.1330-1.1360

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.417 Buy
20-DMA   1.1188 Sell
50-DMA   1.1224 Sell
100-DMA   1.1291 Sell
200-DMA   1.1384 Sell
STOCH(5,3)   79.157 Buy
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2649/GBP, high of US$1.2701/GBP and settled the day down by 0.189% to close at US$1.2652/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 1.2750-1.2890 with targets at 1.2700-1.2660-1.2600 and 1.2550-1.2500 stop should be below 1.2890. Buy above 1.2700-1.2450 with targets 1.2750-1.2850 and 1.2890-1.2930 with stop loss closing below 1.2500.

 
Intraday Support Levels
S1     1.2650-1.2600
S2     1.2550
S3     1.2500-1.2450

Intraday Resistance Levels
R1     1.2700-1.2750
R2     1.2780
R3     1.2850-1.2900

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

25.713

Buy
20-DMA   1.2925 Buy
50-DMA   1.3029 Sell
100-DMA   1.3013 Buy
200-DMA   1.2953 Buy
STOCH(5,3)   9.996 Sell
MACD(12,26,9)   -0.0011 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY109.20/USD and made an intraday high of JPY109.62/USD and settled the day down by 0.101% at JPY109.36/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 109.50-107.70 with targets of 110.00-110.60-111.5 and 111.90-112.25 with stop below 107.50.

 
Intraday Support Levels
S1     109.50
S2     109.05
S3     108.40-107.70

INTRADAY RESISTANCE LEVELS
R1     110.00-110.60
R2     111.50
R3     112.00-112.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.291 Buy
20-DMA   110.19 Sell
50-DMA   111.89 Sell
100-DMA   110.54 Buy
200-DMA   111.40 Sell
STOCH(9,6)   11.955 Sell
MACD(12,26,9)   -0.466 Buy

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