AAFX TRADING

Daily Market Lookup

  • Fragile investor confidence supported the dollar and weakened the yen on Wednesday but currency markets kept to tight ranges ahead of series of major central bank meetings over the next week. Investor focus for now is centered on the European Central Bank's meeting on Thursday, which is expected to push interest rates even further into negative territory. The ECB could set the tone for upcoming rate-setting decisions by the U.S. Federal Reserve and the Bank of Japan next week, and for the broader global risk appetite. For now, a cautious risk-on mood has prevailed after political crises that had hobbled markets, from Britain to Hong Kong, abated, taking the shine off safe-haven assets. Bonds slid overnight and the yen hit 107.65 per dollar, its lowest since Aug. 1. Overhanging the relief buying, however, are signs of a slowdown in global demand, which have offset recent positive developments in U.S.-China trade negotiations. ECB policymakers are leaning toward a package that includes a rate cut, a pledge to keep rates low for longer and compensation for banks over the side-effects of negative rates, five sources familiar with the discussion said last week. On the other hand, concerns have been building that global central banks are reaching the limits of their stimulus options, especially those with negative interest rates and sub-zero long-term sovereign bond yields. Much of the positive mood in recent days has been driven by optimism that a high-level meeting of U.S. and Chinese negotiators at Washington next month can deliver some sort of trade-war circuit breaker. That was tamped down somewhat by White House trade advisor Peter Navarro on Tuesday, when he urged patience about resolving the two-year trade dispute between the world's two largest economies and said to "let the process take its course." But the prospect of a breakthrough stoked appetite for Asian currencies such as the trade-exposed South Korean won , which drifted higher in Asian trading hours and to around 1189.50 per dollar, close to its highest since Aug. 2. The yen, already under pressure as investor’s spurned safe havens, was further sold overnight after Reuters reported BOJ policymakers are more open to discussing the possibility of expanding stimulus at their board meeting on Sept. 18-19. And the pound has held on to last week's gains after British parliament passed a law compelling Prime Minister Boris Johnson to seek a delay to the Oct. 31 date for leaving the European Union.
  • The Chinese yuan inched up against the U.S. dollar on Wednesday in Asia after Beijing scrapped foreign quota and allowed unfettered access to the stock markets. China’s State Administration of Foreign Exchange said in a statement on Wednesday that it would remove quota restrictions on the dollar-dominated qualified foreign institutional investor scheme and RQFII, a programme introduced in 2011 that gives investors access to offshore renminbi to buy mainland-traded stocks. Beijing said the move would “make it much more convenient for overseas investors to participate in China’s domestic financial markets, making China’s bond and stock markets more broadly accepted by international markets.” China in January doubled the QFII quota to $300 billion. According to CNBC, only $111.4 billion of the limit had been used by foreign investors so far. The pound traded slightly lower earlier in the day after the U.K. employment report for July showed solid wage growth and a slight decrease in the unemployment rate. The US Dollar Index that tracks the greenback against a basket of other currencies was unchanged at 98.308. While not a directional driver, data from the Labor Department showed overnight that job openings slipped by 31,000 to a seasonally adjusted 7.2 million in July.
  • Oil prices traded higher on Wednesday after an industry report said U.S. crude stockpiles fell last week by more than twice the amount that analysts in a Reuters poll had forecast. Prices had ended lower on Tuesday, squeezed by speculation of sanctions-hit Iranian crude returning to the market following U.S. President Donald Trump's move to fire national security adviser John Bolton, a noted Iran policy hawk. But they rebounded after American Petroleum Institute (API) data late on Tuesday showed U.S. crude oil and gasoline stocks fell last week, while distillate stocks built. The API numbers had U.S. crude inventories down by 7.2 million barrels in the week ended Sept. 6 to 421.9 million, compared with analysts' expectations in a Reuters poll of a decrease of 2.7 million barrels. Halley said he was expecting a drawdown of 4.8 million barrels when official numbers are released by the Energy Information Administration (EIA) later on Wednesday. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 1.4 million barrels, the API said, while refinery crude runs rose by 208,000 barrels per day. Gasoline stocks fell by 4.5 million barrels, the industry group said, compared with analysts' expectations of an 847,000-barrel decline in a Reuters poll. Prices had risen sharply before Bolton's removal, boosted after Prince Abdulaziz bin Salman, Saudi Arabia's new energy minister, said the kingdom's oil policy would not change and a deal with other producers to cut output by a combined 1.2 million barrels per day would be maintained. Iran's oil exports were slashed by more than 80% due to re-imposed sanctions by the United States after Trump last year exited the 2015 nuclear deal between Tehran and world powers. Both the Energy Information Administration's weekly report and the OPEC monthly report will be release later in the day. Also supporting prices were comments by Prince Abdulaziz bin Salman, Saudi Arabia's new energy minister, who said the kingdom will not change its policy to cut production output by 1.2 million barrels per day.

 

 
Intraday RESISTANCE LEVELS
11th September 2019 R1 R2 R3
GOLD-XAU 1,500-1,509 1,520 1532-1,539
Silver-XAG 18.10-18.60 18.90 19.50-20.00
Crude Oil 58.00-58.80 59.50 60.30
EURO/USD 1.1050 1.1070 1.1100-1.1150
GBP/USD 1.2350-1.2400 1.2440 1.2525
USD/JPY 107.60-108.20 108.90 109.55

Intraday SUPPORTS LEVELS
11th September 2019 S1 S2 S3
GOLD-XAU 1,490-1,480 1,469 1,460
Silver-XAG 17.90-17.50 16.70 16.00
Crude Oil 57.60-56.50 56.05 55.40-54.50
EURO/USD 1.1030-1.0940 1.0910 1.0860-1.0815
GBP/USD 1.2310-1.2250 1.2190 1.2100-1.2065¬
USD/JPY 107.00-106.50 106.10 105.60-105.00

Intra-Day Strategy (11th September 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$1500.90/oz and low of US$1484.38/oz. Gold down by 0.904% at US$1485.17/oz.

Technicals in Focus:

In daily charts, prices are above 20DMA (1506) and breakage below will call for 1400. 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 1490-1460 with risk below 1460, targeting 1500-1509-1520 and 1532-1539. Sell below 1500-1539 keeping stop loss closing above 1539, targeting 1489-1480 and 1469-1460.

 
Intraday Support Levels
S1     1,490-1,480
S2     1,469
S3     1,460
Intraday Resistance Levels
R1     1,500-1,509
R2     1,520
R3     1532-1,539

Technical Indicators

Name   Value Action
14DRSI  

54.734

Buy
20-DMA   1519.38 Buy
50-DMA  

1469.76

Buy
100-DMA   1394.97 Buy
200-DMA   1342.37 Buy
STOCH(5,3)   5.519 Sell
MACD(12,26,9)   5.325 Buy

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$18.16/oz and low of US$17.92/oz. Silver settled up by 0.641% at US$17.98/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 50DMA (15.70), breakage below will lead to 15.20. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is in overbought 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 17.90-16.70 targeting 18.20-18.60-18.90 and 19.50-20.00; stop breakage below 16.90. Sell below 18.20-20.50 with stop loss above 20.50; targeting 17.90-17.50-16.80 and 16.00.

 
Intraday  Support Levels
S1     17.90-17.50
S2     16.70
S3     16.00

Intraday  Resistance Levels
R1     18.10-18.60
R2     18.90
R3     19.50-20.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.718 Buy
20-DMA   17.89 Buy
50-DMA   16.79 Buy
100-DMA   15.82 Buy
200-DMA   15.55 Buy
STOCH(5,3)   8.246 Buy
MACD(12,26,9)   0.478 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US$58.63/bbl, intraday low of US$57.08/bbl and settled downd by 0.247% to close at US$57.74/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 58.00-60.30 with stop loss at 60.30; targeting 57.60-56.50-56.05 and 55.40-54.90-54.50. Buy above 57.60-53.60 with risk daily closing below 53.60 and targeting 58.00-58.80 and 59.50-60.30.

 
Intraday Support Levels
S1     57.60-56.50
S2     56.05
S3     55.40-54.50

Intraday Resistance Levels
R1     58.00-58.80
R2     59.50
R3     60.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   59.413 Sell
20-DMA   55.50 Buy
50-DMA   56.14 Buy
100-DMA   57.38 Sell
200-DMA   56.30 Buy
STOCH(5,3)   88.130 Buy
MACD(12,26,9)   -0.327 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday made an intraday low of US$1.1029/EUR, high of US$1.1058/EUR and settled the day down by 0.271% to close at US$1.1042/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1293), which become immediate resistance level, break above will target 1.1320-1.1350. 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 1.1010-1.0815 with risk below 1.0815, targeting 1.1050-1.1070 and 1.1160-1.1200. Sell below 1.1050-1.1150 targeting 1.1020-1.0960-1.0910 and 1.0860-1.0815 with stop-loss at daily closing above 1.1150.

 
Intraday Support Levels
S1     1.1030-1.0940
S2     1.0910
S3     1.0860-1.0815

Intraday  Resistance Levels
R1     1.1050
R2     1.1070
R3     1.1100-1.1150

TECHNICAL INDICATORS
Name   Value Action
14DRSI   43.422 Buy
20-DMA   1.1061 Sell
50-DMA   1.1142 Sell
100-DMA   1.1185 Sell
200-DMA   1.1263 Sell
STOCH(5,3)   68.958 Buy
MACD(12,26,9)   -0.003 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2306/GBP, high of US$1.2379/GBP and settled the day up by 0.0137% to close at US$1.2344/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 1.2350-1.2525 with targets at 1.2310-1.2250-1.2190 and 1.2100-1.2065-1.2010 stop-loss should be below 1.2400. Buy above 1.2310-1.2065 with targets 1.2250-1.2300 and 1.2350-1.2400 with stop loss closing below 1.1800.

 
Intraday Support Levels
S1     1.2310-1.2250
S2     1.2190
S3     1.2100-1.2065¬

Intraday Resistance Levels
R1     1.2350-1.2400
R2     1.2440
R3     1.2525

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

57.754

Buy
20-DMA   1.2172 Sell
50-DMA   1.2298 Sell
100-DMA   1.2542 Sell
200-DMA   1.2747 Sell
STOCH(5,3)   95.175 Buy
MACD(12,26,9)   -0.0004 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY107.17/USD and made an intraday high of JPY107.52/USD and settled the day up by 0.276% at JPY107.52/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 50DMA (107.84), 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 107.60-109.55 with risk above 109.55 targeting 107.00-106.50-106.10 and 105.80-105.00-104.50. Long positions above 107.10-105.00 with targets of 107.60-108.20 and 108.90-109.55 with stop below 105.00.

 
Intraday Support Levels
S1     107.00-106.50
S2     106.10
S3     105.60-105.00

INTRADAY RESISTANCE LEVELS
R1     107.60-108.20
R2     108.90
R3     109.55

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.821 Buy
20-DMA   106.35 Sell
50-DMA   107.13 Sell
100-DMA   108.21 Buy
200-DMA   109.52 Sell
STOCH(9,6)   88.253 Buy
MACD(12,26,9)   -0.002 Buy

AAFX TRADING
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