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Daily Market Lookup

  • TAsian shares caught the tail of a Wall Street rally on Friday, helped by China’s better-than-expected export figures but fresh concerns about Sino-U.S. trade ties are likely to limit gains in the region. Weighing on risk appetite was a report from Bloomberg that Washington is delaying a decision about licenses for U.S. firms to restart trade with Huawei Technologies. That sent U.S. stock futures down as much as 0.6% in early Asian trade. They were last quoted 0.4% lower on the day. However, that optimism was dented by the Bloomberg report, which has reinforced concerns the deterioration in U.S.-China relations will place additional strain on an already fragile global economy. U.S. data pointed to a robust labor market as the number of Americans filing applications for unemployment benefits unexpectedly fell last week, allaying some worries about a recession and helping Treasury yields rise. The offshore yuan was stable versus the dollar in early trade but could be closely watched as traders assess the latest developments in the rapidly escalating trade war between the United States and China. The offshore yuan was stable versus the dollar in early trade after an alarming early week slide, but it will be closely watched as traders eye Beijing's response to escalating trade tensions. The pound traded near a two-year low versus the euro after a media report said new Prime Minister Boris Johnson is preparing to hold an election after the Oct. 31 deadline for Britain to leave the European Union. Increased uncertainty about the standoff between the United States and China, as well as uncertainty about Brexit, is likely to continue to support safe-haven currencies and risk-off trades in coming weeks. Yen traders were largely unfazed by data showing Japan's economy grew much more than expected in April-June, as robust private consumption and business investment offset the hit to exports from cooling global demand. The data offers some relief for the Bank of Japan, which is under pressure to follow other central banks and ramp up stimulus to head off heightening global risks. The trade war has entered new territory after U.S. President Donald Trump said he will impose more tariffs on Chinese imports from Sept. 1. China let the yuan slide through a key support level on Monday to an 11-year low and hours later the U.S. Treasury Department labeled China a currency manipulator. There are growing concerns the rapid deterioration in U.S.-China relations will place additional strain on an already fragile global economy. The Financial Times, citing unidentified senior aides to the prime minister, reported that Johnson would hold an election in the days following Brexit if lawmakers sunk his government with a vote of no-confidence. Johnson has said he will take Britain out of the European Union on Oct. 31 even if that means leaving without a transition agreement.
  • The number of Americans filing applications for unemployment benefits unexpectedly fell last week, suggesting the labor market remains strong even as the economy is slowing. The jobless claims report from the Labor Department on Thursday, however, does not fully account for the impact of the recent escalation in the bitter trade war between the United States and China, which has led to an inversion of the U.S. Treasury yield curve and raised the risk of a recession. Worries about the trade war’s effect on the economic expansion, the longest on record, prompted the Federal Reserve to cut interest rates last week for the first time since 2008. Financial markets have fully priced in another rate cut next month. Expectations for a 50-basis-point cut at the Fed’s Sept. 17-18 policy meeting have also risen. Initial claims for state unemployment benefits fell 8,000 to a seasonally adjusted 209,000 for the week ended Aug. 3, the government said. Economists polled by Reuters had forecast claims would be unchanged at 215,000 in the latest week. Last week’s drop in claims pushed them to the lower end of their 193,000-244,000 range for this year. The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, edged up 250 to 212,250 last week. Nonfarm payrolls increased by 164,000 jobs in July, down from 193,000 in June. Job growth over the last three months averaged 140,000 per month, the lowest in nearly two years, compared to 223,000 in 2018. The moderation in employment growth partly reflects a shortage of workers. The economy grew at a 2.1% annualized rate in the second quarter, slowing from the first quarter’s brisk 3.1% pace. Growth is seen below a 2.0% rate in the July-September quarter. But economists expect the government will lower its second-quarter GDP growth estimate to around a 1.8% rate later this month after a separate report from the Commerce Department on Thursday showed wholesale inventories were unchanged in June instead of rising 0.2% as reported last month. That means inventories chopped 1.0 percentage point from GDP, rather than the estimated 0.86 percentage point.
  • Oil prices rose on Friday, supported by expectations of more production cuts by OPEC amid fears the U.S.-China trade row could lead to a global slowdown, curbing demand for crude. Both contracts jumped more than 2% on Thursday to recover from January lows, buoyed by reports that Saudi Arabia, the world's biggest oil exporter, had called other producers to discuss the recent slide in crude prices. Oil prices have still lost more than 20% from their peaks reached in April, putting them in bear territory. Global financial markets were rocked over the past week after U.S. President Donald Trump said he would impose 10% tariffs on Chinese goods starting September and a fall in the Chinese yuan sparked fears of a currency war. China's yuan strengthened against the dollar on Thursday, on the back of strong export growth in July Saudi Arabia, de facto leader of the OPEC, planned to maintain its crude oil exports below 7 Mn bpd in August and September to bring the market back to balance and help absorb global oil inventories, a Saudi oil official said on Wednesday. The United Arab Emirates also will continue to support actions to balance the oil market, the country's energy minister Suhail al-Mazrouei said in a tweet on Thursday The minister said the OPEC and non-OPEC ministerial monitoring committee would meet in Abu Dhabi on Sept. 12 to review the oil market. OPEC and its allies including Russia agreed in July to extend their supply cuts until March 2020 to boost oil prices.

 

 
Intraday RESISTANCE LEVELS
9th August 2019 R1 R2 R3
GOLD-XAU 1,509 1,516-1,526 1,539
Silver-XAG 17.20-17.50 17.90 18.50-18.90
Crude Oil 53.00-53.60 54.05 54.50-54.90
EURO/USD 1.1200-1.1250 1.1290 1.1325-1.1350
GBP/USD 1.2150-1.2190 1.2250 1.2300-1.2350
USD/JPY 106.10-106.50 107.00 107.60-108.00

Intraday SUPPORTS LEVELS
9th August 2019 S1 S2 S3
GOLD-XAU 1,500-1,489 1,481 1,474-1,469
Silver-XAG 16.90-16.60 16.20 15.90-15.50
Crude Oil 52.50 51.90 51.00-50.60
EURO/USD 1.1180 1.1130 1.1090-1.1000
GBP/USD 1.2100-1.2065 1.1980 1.1950-1.1900
USD/JPY 105.80 105.00 104.50-104.00

Intra-Day Strategy (9th August 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 Thursday made its intraday high of US$1509.38/oz and low of US$1489.91/oz. Gold up by 0.013% at US$1500.77/oz.

Technicals in Focus:

In daily charts, prices are above 100DMA (1339) and breakage below will call for 1321-1300. 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 negative crossover to confirm bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1500-1489 with risk below 1489, targeting 1509-1516 and 1526-1539. Sell below 1509-1539 keeping stop loss closing above 1439, targeting 1494-1489-1481 and 1474-1469-1460.

 
Intraday Support Levels
S1     1,500-1,489
S2     1,481
S3     1,474-1,469
Intraday Resistance Levels
R1     1,509
R2     1,516-1,526
R3     1,539

Technical Indicators

Name   Value Action
14DRSI  

72.391

Buy
20-DMA   1440.22 Buy
50-DMA  

1402.22

Buy
100-DMA   1344.93 Buy
200-DMA   1309.92 Buy
STOCH(5,3)   89.519 Sell
MACD(12,26,9)   25.325 Buy

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$17.19/oz and low of US$16.79/oz. Silver settled down by 1.213% at US$16.91/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 200DMA (15.00), 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 17.00-15.00 targeting 17.20-17.50 and 17.90-18.50-18.90; stop breakage below 15.00. Sell below 17.20-18.90 with stop loss above 18.90; targeting 16.90-16.60-16.20 and 15.90-15.50.

 
Intraday  Support Levels
S1     16.90-16.60
S2     16.20
S3     15.90-15.50

Intraday  Resistance Levels
R1     17.20-17.50
R2     17.90
R3     18.50-18.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   69.768 Buy
20-DMA   16.35 Sell
50-DMA   15.58 Buy
100-DMA   15.22 Buy
200-DMA   15.17 Buy
STOCH(5,3)   82.246 Buy
MACD(12,26,9)   0.372 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$52.94/bbl, intraday low of US$51.83/bbl and settled up by 1.224% to close at US$52.83/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 53.00-55.00 with stop loss at 55.10; targeting 52.50-51.90 and 51.00-50.60-50.00. Buy above 52.50-50.60 with risk daily closing below 50.60 and targeting 53.60-54.05-54.50-54.90 and 55.50-56.10.

 
Intraday Support Levels
S1     52.50
S2     51.90
S3     51.00-50.60

Intraday Resistance Levels
R1     53.00-53.60
R2     54.05
R3     54.50-54.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   36.506 Sell
20-DMA   56.14 Buy
50-DMA   55.93 Buy
100-DMA   59.00 Sell
200-DMA   56.91 Buy
STOCH(5,3)   21.130 Buy
MACD(12,26,9)   -1.057 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday made an intraday low of US$1.1176/EUR, high of US$1.1231/EUR and settled the day down by 0.175% to close at US$1.1178/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 negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider.

Trading Strategy: Neutral to Buy

Buy above 1.1180-1.1000 with risk below 1.1000, targeting 1.1200-1.1250-1.1290 and1.1.1325-1.1350-1.1400-. Sell below 1.1200-1.1350 targeting 1.1180-1.1130 and 1.1090-1.1005 with stop-loss at daily closing above 1.1210.

 
Intraday Support Levels
S1     1.1180
S2     1.1130
S3     1.1090-1.1000

Intraday  Resistance Levels
R1     1.1200-1.1250
R2     1.1290
R3     1.1325-1.1350

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.3885 Buy
20-DMA   1.1174 Buy
50-DMA   1.1238 Sell
100-DMA   1.1224 Sell
200-DMA   1.1294 Sell
STOCH(5,3)   68.958 Sell
MACD(12,26,9)   -0.0013 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2094/GBP, high of US$1.2181/GBP and settled the day down by 0.072% to close at US$1.2129/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 1.2150-1.2410 with targets at 1.2100-1.2065 and 1.1980-1.1950-1.1900 stop-loss should be below 1.2410. Buy above 1.2100-1.1900 with targets 1.2140-1.2190-1.2250 and 1.2300-1.2350 with stop loss closing below 1.2200.

 
Intraday Support Levels
S1     1.2100-1.2065
S2     1.1980
S3     1.1950-1.1900

Intraday Resistance Levels
R1     1.2150-1.2190
R2     1.2250
R3     1.2300-1.2350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

31.170

Buy
20-DMA   1.2306 Sell
50-DMA   1.2501 Sell
100-DMA   1.2725 Sell
200-DMA   1.2821 Sell
STOCH(5,3)   38.175 Buy
MACD(12,26,9)   -0.0011 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY105.88/USD and made an intraday high of JPY106.29/USD and settled the day down by 0.182% at JPY106.06/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 106.10-108.00 with risk above 108.00 targeting 105.80-105.00 and 104.50-104.00. Long positions above 105.80-104.00 with targets of 106.50-107.00 and 107.60-108.00-109.05 with stop below 106.00.

 
Intraday Support Levels
S1     105.80
S2     105.00
S3     104.50-104.00

INTRADAY RESISTANCE LEVELS
R1     106.10-106.50
R2     107.00
R3     107.60-108.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   32.949 Buy
20-DMA   107.56 Sell
50-DMA   107.90 Sell
100-DMA   109.33 Buy
200-DMA   110.29 Sell
STOCH(9,6)   24.253 Sell
MACD(12,26,9)   -0.553 Buy

AAFX TRADING
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