AAFX TRADING

Daily Market Lookup

  • Asian stocks dipped on Wednesday and the dollar inched up from three-month lows after Federal Reserve officials tempered expectations in the markets for aggressive monetary easing. Fed Chair Jerome Powell on Tuesday said the central bank is “insulated from short-term political pressures,” pushing back against U.S. President Donald Trump’s demand for a significant rate cut. Powell, however, said Fed policymakers are wrestling with questions on whether uncertainties around U.S. tariffs, Washington’s conflicts with trading partners and tame inflation require a rate cut. Separately, St. Louis Fed President James Bullard told Bloomberg Television he does not think the U.S. economy is dire enough to warrant a 50-basis-point cut in July, even though he pushed to lower rates last week. Equity markets have rallied this month, with Wall Street shares advancing to record highs, after the Fed was seen to have opened the door to possible rate cuts as early as next month at is policy-setting meeting last week. Trump said on Twitter on Monday that the Fed “doesn’t know what it is doing,” adding that it “raised rates far too fast” and “blew it” given low inflation and slowing global growth. The United States hopes to re-launch trade talks with Beijing after Trump and his Chinese counterpart Xi Jinping meet in Japan during the G20 summit on Saturday but Washington will not accept any conditions on tariffs, a senior administration official said on Tuesday. The two sides could agree not to impose new tariffs as a goodwill gesture to get negotiations going, the official said, but it was unclear if that would happen. Many G20 members have a stake in the outcome because the row has disrupted global supply chains, slowed world growth and stirred expectations of interest rate cuts or other stimulus measures by some of the group’s central bank. The greenback had sunk to the six-month trough as the yen, a perceived safe haven, had drawn bids in the face of brewing U.S.-Iran tensions. The U.S. data helped underpin a crude market already buoyed by worries over potential U.S.-Iran conflict.
  • Federal Reserve officials on Tuesday pushed back on market expectations and presidential pressure for the central bank to deliver a significant U.S. interest rate cut of half a percentage point as soon as its next meeting. Chairman Jerome Powell defended the central bank’s independence from President Donald Trump and financial markets, both of which seem to be pushing for aggressive rate cuts, in remarks at the Council on Foreign Relations in New York. “The Fed is insulated from short-term political pressures,” said Powell. Asked later about the possibility of disappointing markets by not delivering a cut, Powell added, “We’re not in the business, really, of trying to work through short-term movements in financial conditions. We have to look through that.” But he said he and his colleagues are currently grappling with whether uncertainties around U.S. tariffs, Washington’s conflict with trading partners and tame inflation require a rate cut. St. Louis Federal Reserve Bank President James Bullard on Tuesday said he does not think the U.S. economic situation is dire enough to warrant cutting rates by a half-percentage point at its next meeting in July, even though he pushed to lower rates last week At a meeting last Wednesday, the central bank left interest rates on hold but signaled reductions beginning as early as July. Bullard dissented, arguing that weak inflation and uncertainties about the outlook for economic growth warranted a rate cut. Richmond Federal Reserve President Thomas Barkin said there was a risk of recession for the United States but when asked if a rate cut might be needed this year, he said: “I don’t know.” Investors have long been anticipating rate cuts this year even as Fed policymakers had once suggested such a move would have been premature or even irresponsible in light of a strong labor market and lofty asset prices. The Fed’s rate-setting committee next gathers on July 30-31. In the meantime, policymakers will be closely watching data on U.S. economic growth and jobs as well as the G20 summit in Osaka, Japan, at the end of the week, where Trump is due to meet one-on-one with at least eight world leaders, including Chinese President Xi Jinping, for discussions on trade. The two leaders have been at odds on the terms of a trade deal that could resolve months of disagreements that have led to tit-for-tat tariffs. Powell is facing increasing anger from Trump, who nominated him for the job in late 2017.
  • Oil prices gained on Wednesday in Asia as data showed U.S. crude inventories continued to shrink. The gains came after the American Petroleum Institutereported a fall in U.S. crude inventories. U.S. crude stockpiles fell by 7.5 million barrels in the week ended June 21 to 474.5 million, more than the expectations of a decline of 2.5 million barrels, according to API. Crude stocks at U.S. delivery hub Cushing, Oklahoma, fell by 1.3 million barrels. Traders expect weekly data from the U.S. Energy Information Administration, due later in the day, will show a 2.5-million-barrel drop in crude stockpiles, almost matching the last decline of 3.1 million barrels. Meanwhile, Kremlin spokesman Dmitry Peskov said on Tuesday that Russian President Vladimir Putin will meet Saudi Crown Prince Mohammed Bin Salman at the G-20 summit this weekend. It is expected the two will discuss whether and how to extend the current production cut agreement between the Organiz. U.S. President Donald Trump threatened on Tuesday to obliterate parts of Iran if it attacked "anything American", in a new war of words with Iran. Tehran has condemned a fresh round of U.S. sanctions as "mentally retarded". Bilateral tensions between the two have spiked anew after Iran shot down a U.S. drone last week in the Gulf. Relations have been tense since Washington blamed attacks on oil tankers just outside the Gulf in May and June on Iran, while Tehran has repeatedly said it had no role in the incidents. Conflict between Washington and Tehran has stoked fears that shipments passing through the Strait of Hormuz - the world's busiest oil supply route - could be disrupted. Seeking to calm a nervous market, the head of national oil company Saudi Aramco said on Tuesday the company can meet the oil needs of customers using its spare capacity.

 

 
Intraday RESISTANCE LEVELS
26th June 2019 R1 R2 R3
GOLD-XAU 1,415-1,425 1,433 1.440-1,450
Silver-XAG 15.35-15.60 16.00 16.20-16.50
Crude Oil 59.50-60.20 61.00 61.70-62.50
EURO/USD 1.1390-1.1420 1.1450 1.1500-1.1550
GBP/USD 1.2700-1.2760 1.2790 1.2830-1.2870
USD/JPY 107.60-108.00 109.05 109.50-110.00

Intraday SUPPORTS LEVELS
26th June 2019 S1 S2 S3
GOLD-XAU 1,405 1,392-1,380 1,374
Silver-XAG 15.05 14.60 14.30-13.90
Crude Oil 58.70-58.10 57.35 56.90-56.60
EURO/USD 1.1350 1.1320 1.1280-1.1220
GBP/USD 1.2650 1.2600-1.2500 1.2450
USD/JPY 107.00-106.50 106.00 105.50

Intra-Day Strategy (26th 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 Tuesday made its intraday high of US$1439.21/oz and low of US$1411.84/oz. Gold up by 0.272% at US$1423.23/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1303) and breakage below will call for 1296-1288. MACD is above zero line and histograms are decreasing trend and it will bring downward stance in the upcoming sessions. RSI is in overbought region and more upside is expected before it gets stretched. Stochastic Oscillator is in overbought 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 1425-1380 with risk below 1380, targeting 1433-1440-1450 and 1456-1465. Sell below 1433-1465 keeping stop loss closing above 1433, targeting 1425-1415-1405 and 1392-1380.

 
Intraday Support Levels
S1     1,405
S2     1,392-1,380
S3     1,374
Intraday Resistance Levels
R1     1,415-1,425
R2     1,433
R3     1.440-1,450

Technical Indicators

Name   Value Action
14DRSI  

77.644

Buy
20-DMA   1350.64 Buy
50-DMA  

1308.43

Buy
100-DMA   1306.85 Buy
200-DMA   1274.09 Buy
STOCH(5,3)   81.621 Sell
MACD(12,26,9)   25.975 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$15.50/oz and low of US$15.26/oz. Silver settled down by 0.344% at US$15.35/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (14.93), 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 oversold region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 15.05-13.20 targeting 15.35-15.60-15.90 and 16.20-16.50; stop breakage below 13.20. Sell below 15.35-16.90 with stop loss above 16.90; targeting 15.35-15.05-14.60 and 14.30-13.90.

 
Intraday  Support Levels
S1     15.05
S2     14.60
S3     14.30-13.90

Intraday  Resistance Levels
R1     15.35-15.60
R2     16.00
R3     16.20-16.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.283 Buy
20-DMA   14.94 Buy
50-DMA   14.81 Buy
100-DMA   15.10 Buy
200-DMA   14.94 Buy
STOCH(5,3)   65.246 Sell
MACD(12,26,9)   0.159 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$58.78/bbl, intraday low of US$57.21/bbl and settled up by 1.714% to close at US$58.72/bbl.

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 59.50-62.50 with stop loss at 62.50; targeting 58.70-58.10-57.35 and 56.90-56.00-55.50. Buy above 56.60-55.00 with risk daily closing below 55.00 and targeting 59.50-60.20an d61.00-61.70-62.50.

 
Intraday Support Levels
S1     58.70-58.10
S2     57.35
S3     56.90-56.60

Intraday Resistance Levels
R1     59.50-60.20
R2     61.00
R3     61.70-62.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.917 Sell
20-DMA   54.42 Sell
50-DMA   59.15 Sell
100-DMA   58.84 Sell
200-DMA   58.74 Sell
STOCH(5,3)   96.130 Buy
MACD(12,26,9)   -0.209 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday made an intraday low of US$1.1343/EUR, high of US$1.1411/EUR and settled the day down by 0.280% to close at US$1.1365/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.1349), which become immediate resistance level, break above will target 1.1320-1.1280. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought 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 1.1350-1.1175 with risk below 1.1175, targeting 1.1390-1.1420-1.1450 and 1.1500-1.1550. Sell below 1.1390-1.1550 targeting 1.1350-1.1320 and 1.1280-1.1220 with stop-loss at daily closing above 1.1540.

 
Intraday Support Levels
S1     1.1350
S2     1.1320
S3     1.1280-1.1220

Intraday  Resistance Levels
R1     1.1390-1.1420
R2     1.1450
R3     1.1500-1.1550

TECHNICAL INDICATORS
Name   Value Action
14DRSI   61.331 Buy
20-DMA   1.1271 Buy
50-DMA   1.1221 Buy
100-DMA   1.1259 Buy
200-DMA   1.1347 Sell
STOCH(5,3)   83.157 Sell
MACD(12,26,9)   0.0037 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2671/GBP, high of US$1.2782/GBP and settled the day down by 0.439% to close at US$1.2681/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 1.2790-1.12950 with targets at 1.2760-1.2700-1.2650 and 1.2600-1.2500-1.2475 stop should be below 1.2870. Buy above 1.2650-1.2400 with targets 1.2700-1.2750-1.2790 and 1.2830-1.2870 with stop loss closing below 1.2400.

 
Intraday Support Levels
S1     1.2650
S2     1.2600-1.2500
S3     1.2450

Intraday Resistance Levels
R1     1.2700-1.2760
R2     1.2790
R3     1.2830-1.2870

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

45.948

Buy
20-DMA   1.2665 Buy
50-DMA   1.2798 Sell
100-DMA   1.2950 Buy
200-DMA   1.2923 Buy
STOCH(5,3)   62.175 Buy
MACD(12,26,9)   -0.0061 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY106.77/USD and made an intraday high of JPY107.40/USD and settled the day down by 0.120% at JPY107.15/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 107.50-111.00 with risk above 111.00 targeting 107.00 106.50 and 106.00-105.50. Long positions above 107.00-105.50 with targets of 107.60-108.00-109.05 and 109.50-110.00-110.60 with stop below 106.00.

 
Intraday Support Levels
S1     107.00-106.50
S2     106.00
S3     105.50

INTRADAY RESISTANCE LEVELS
R1     107.60-108.00
R2     109.05
R3     109.50-110.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.190 Buy
20-DMA   108.80 Sell
50-DMA   110.13 Sell
100-DMA   110.47 Buy
200-DMA   111.15 Sell
STOCH(9,6)   60.955 Sell
MACD(12,26,9)   -0.5704 Buy

AAFX TRADING
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