AAFX TRADING

Daily Market Lookup

  • Global stock indexes rallied on Tuesday and U.S. stocks registered their biggest one-day gains in five months as Federal Reserve Chairman Jerome Powell seemed to open the door to the possibility of a rate cut, while yields on U.S. Treasuries rose. Powell said the U.S. central bank will respond “as appropriate” to the risks posed by a global trade war and other recent developments. His remarks followed St. Louis Fed President James Bullard’s comments late on Monday that a rate cut “may be warranted soon.” In a brief statement included as part of a speech on broader monetary policy issues, Powell said the Fed was “closely monitoring the implications” of ongoing trade disputes. The United States’ trade dispute with China and other countries has been escalating in recent weeks, increasing market uncertainty and driving down stocks in May. A bounceback in U.S. internet-related stocks helped the equity rally following a sell-off in those names Monday that was tied to worries about a clampdown on the world’s internet and social media giants. Powell’s comments helped to push the U.S. dollar modestly lower.
  • The yen edged up versus the dollar on Thursday as sentiment soured over U.S.-Mexico talks on tariffs and immigration, fuelling broader concerns about global trade hostilities and raising appetite for safe-haven currencies. Mexican officials met with their U.S. counterparts for negotiations in Washington on Wednesday aimed at averting U.S. tariffs on Mexican goods next week, although there were no immediate signs of a rapprochement. In a move that could deepen Washington's trade conflict with its partners, U.S. President Donald Trump unexpectedly told Mexico last week to take a harder line on curbing illegal immigration or face 5% tariffs on all its exports to the United States. The greenback was supported earlier on Wednesday on initial optimism toward U.S.-Mexico trade talks, and an Institute for Supply Management (ISM) survey showing that U.S. services sector activity expanded at a brisk pace in May. The European Central Bank makes its monetary policy decision later on Thursday. The central bank will try to give the ailing euro zone a boost and may even set the stage for more action later this year as an escalating global trade war unravels the benefits of years of monetary stimulus. ECB President Mario Draghi is expected to maintain guidance about the possibility of more stimulus. The Mexican peso, already saddled with trade concerns, took a hit after ratings after credit ratings agency Fitch downgraded its sovereign debt rating on Wednesday to BBB, nearing junk status, while Moody's changed the country's outlook to negative from stable. The dollar index had stooped to a two-month low as U.S. yields declined sharply this week on investor risk aversion and heightened prospects of the Federal Reserve cutting interest rates.
  • Oil remained bearish on Thursday morning in Asia as the U.S. reported record inventories, while demand continues to be threatened by economic slowdown and trade disputes U.S. crude oil production rose to a record 124.4 million barrels per day (bpd) in the week to May 31, said the Energy Information Administration (EIA), which also showed that inventories increased by 6.771 million barrels in the week to May 31, compared with forecasts for a stockpile draw of 0.85 million barrels According to the EIA, U.S. crude oil refinery inputs averaged 16.9 million bpd during the week ending May 31, which was 171,000 bpd more than the previous week’s average The Organization of the Petroleum Exporting Countries (OPEC) and some non-affiliated producers including Russia, have been curbing oil supply since the start of the year to shore up the market. The group will decide later this month or in early July whether to continue withholding production Meanwhile, oil demand is also facing pressure from slowing economic growth and trade tensions. Oil prices steadied on Thursday after falling to near 5-month lows in the previous session, but sentiment remained weak as markets are under pressure from rising U.S. supply and a stalling economy. Despite Thursday's gains, oil markets have moved into bear territory as defined by a 20% fall from recent peaks reached in late April. U.S. crude production rose to a record 12.4 million barrels per day (bpd) in the week to May 31, the Energy Information Administration (EIA) said on Wednesday, an increase of 1.63 million bpd since May 2018. Amid surging output, U.S. commercial crude inventories surged by 6.8 million in week to May 31, to 483.26 million barrels, their highest levels since July 2017. The Middle East-dominated producer club of the Organization of the Petroleum Exporting Countries (OPEC) and some non-affiliated producers including Russia, known as OPEC+, have been withholding oil supply since the start of the year to prop up the market. ut outside OPEC+ supply is rising, not just in the United States. Oil output at Kazakhstan's Kashagan field reached a record 400,000 bpd this week, industry sources told Reuters. Output rose after completion of maintenance in May. Prior to that, production at Kashagan was about 330,000 to 340,000 bpd.With supply ample despite the OPEC-led cuts, much will depend on demand.

 

 
Intraday RESISTANCE LEVELS
6th June 2019 R1 R2 R3
GOLD-XAU 1,334-1,340 1,346 1,350-1,357
Silver-XAG 15.05 15.30 15.60-16.00
Crude Oil 52.50-53.50 54.00 54.80-55.50
EURO/USD 1.1280-1.1330 1.1390 1.1440
GBP/USD 1.2700 1.2750 1.2780-1.2850
USD/JPY 109.05-109.50 110.00 110.60-111.50

Intraday SUPPORTS LEVELS
6th June 2019 S1 S2 S3
GOLD-XAU 1,324-1316 1,309 1,300-1,294
Silver-XAG 14.70-14.30 13.90 13.50-13.20
Crude Oil 51.90 51.40 50.90-50.00
EURO/USD 1.1250-1.1200 1.1150 1.1100-1.1070
GBP/USD 1.2650-1.2600 1.2550 1.2500-1.2450
USD/JPY 108.00-107.70 107.00 106.50

Intra-Day Strategy (6th June 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 Wednesday made its intraday high of US$1344.02/oz and low of US$1324.22/oz. Gold up by 0.381% at US$1330.19/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 positive 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 1324-1294 with risk below 1294, targeting 1331-1340-1346 and 1350-1357. Sell below 1334-1356 keeping stop loss closing above 1354, targeting 1324-1316-1309 and 1300-1294.

 
Intraday Support Levels
S1     1,324-1316
S2     1,309
S3     1,300-1,294
Intraday Resistance Levels
R1     1,334-1,340
R2     1,346
R3     1,350-1,357

Technical Indicators

Name   Value Action
14DRSI  

74.381

Buy
20-DMA   1294.31 Buy
50-DMA  

1288.61

Buy
100-DMA   1297.94 Buy
200-DMA   1262.82 Buy
STOCH(5,3)   83.621 Sell
MACD(12,26,9)   10.142 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$15.03/oz and low of US$14.75/oz. Silver settled down by 0.135% at US$14.79/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 14.70-13.20 targeting 15.05-15.30 and 15.60-15.90; stop breakage below 13.20. Sell below 15.05-16.00 with stop loss above 16.00; targeting 14.30-13.90 and 13.50-13.20.

 
Intraday  Support Levels
S1     14.70-14.30
S2     13.90
S3     13.50-13.20

Intraday  Resistance Levels
R1     15.05
R2     15.30
R3     15.60-16.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   54.976 Buy
20-DMA   14.60 Sell
50-DMA   14.82 Sell
100-DMA   15.18 Sell
200-DMA   14.89 Buy
STOCH(5,3)   73.246 Buy
MACD(12,26,9)   -0.0126 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US$53.47/bbl, intraday low of US$50.68/bbl and settled down by 2.84% to close at US$51.74/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 52.50-56.00 with stop loss at 56.00; targeting 51.80-51.40 and 50.90-59.00. Buy above 51.50-50.00 with risk daily closing below 50.00 and targeting 52.50-53.50-54.00 and 54.80-55.50.

 
Intraday Support Levels
S1     51.90
S2     51.40
S3     50.90-50.00

Intraday Resistance Levels
R1     52.50-53.50
R2     54.00
R3     54.80-55.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   22.196 Sell
20-DMA   58.68 Sell
50-DMA   61.38 Sell
100-DMA   58.66 Sell
200-DMA   59.72 Sell
STOCH(5,3)   13.130 Sell
MACD(12,26,9)   -1.906 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday made an intraday low of US$1.1219/EUR, high of US$1.1306/EUR and settled the day down by 0.274% to close at US$1.1219/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 1.1250-1.1075 with risk below 1.1075, targeting 1.1280-1.1305-1.1350 and 1.1390-1.1440. Sell below 1.1280-1.1440 targeting 1.1250-1.1200-1.1100 and 1.1070-1.1020 with stop-loss at daily closing above 1.0950.

 
Intraday Support Levels
S1     1.1250-1.1200
S2     1.1150
S3     1.1100-1.1070

Intraday  Resistance Levels
R1     1.1280-1.1330
R2     1.1390
R3     1.1440

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.0635 Buy
20-DMA   1.1186 Buy
50-DMA   1.1209 Buy
100-DMA   1.1276 Sell
200-DMA   1.1375 Sell
STOCH(5,3)   78.157 Sell
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.2679/GBP, high of US$1.2743/GBP and settled the day up by 0.285% to close at US$1.2683/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 1.2700-1.2850 with targets at 1.2600-1.2550 and 1.2500-1.2450 stop should be below 1.2890. Buy above 1.2650-1.2450 with targets 1.2650-1.2700-1.2750 and 1.2850-1.2890 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
R2     1.2750
R3     1.2780-1.2850

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

34.555

Buy
20-DMA   1.2759 Buy
50-DMA   1.2927 Sell
100-DMA   1.3002 Buy
200-DMA   1.2947 Buy
STOCH(5,3)   34.996 Buy
MACD(12,26,9)   -0.0094 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY107.80/USD and made an intraday high of JPY108.47/USD and settled the day up by 0.294% at JPY108.45/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 109.00-113.00 with risk above 113.00 targeting 108.00-107.70-107.00 and 106.50-106.00. Long positions above 108.05-107.70 with targets of 109.05-109.50 and 110.00-110.60-111.5 with stop below 107.50.

 
Intraday Support Levels
S1     108.00-107.70
S2     107.00
S3     106.50

INTRADAY RESISTANCE LEVELS
R1     109.05-109.50
R2     110.00
R3     110.60-111.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   27.317 Buy
20-DMA   109.79 Sell
50-DMA   110.78 Sell
100-DMA   110.58 Buy
200-DMA   111.35 Sell
STOCH(9,6)   7.955 Sell
MACD(12,26,9)   -0.466 Buy

AAFX TRADING
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