AAFX TRADING

Daily Market Lookup

  • The dollar found broad support on Monday as global political uncertainty and fears over a widening of the Sino-U.S trade war kept investors in safe harbours ahead of a slew of global economic indicators this week. In Asian hours, traders mostly shrugged off news that the Trump administration was considering de-listing Chinese companies from U.S. stock markets after the reports were hosed down by Treasury officials. Elsewhere, factory activity surveys in China suggested there were some signs of improvement this month, though analysts believe the gains cannot be sustained and forecast further economic weakness. German inflation, British economic growth and U.S. manufacturing indicators are all due later on Monday, with U.S. employment figures at the end of the week. Anything short of expectations poses a risk to fragile sentiment. The U.S. dollar was flat on Friday after data showed that consumers spent less and companies cut their equipment orders in August. Consumer spending on goods and services rose 0.1% in August, while durable goods orders inched up 0.2% compared to a rise of 2% in July, according to separate reports from the Commerce Department. The numbers suggest that the economy is cooling after a strong acceleration in the second quarter, putting focus on next week’s monthly jobs report. Federal Reserve officials cut interest rates by a quarter points for the second time in two months due to slowing growth in the global economy and worries about trade. Sterling recovered from earlier lows, but still remained in the red after Ireland’s Tánaiste Simon Coveney said that the EU was ready to negotiate, but that the U.K. had not yet sent a proposal for a Brexit deal. Uncertainty over Brexit remains as U.K. Prime Minister Boris Johnson faces political pressures at home. The U.K. is expected to leave the EU on Oct. 31.
  • Asian stock markets, including China’s, were little changed on Monday, shrugging off news that the U.S. administration is considering delisting Chinese companies from U.S. stock exchanges. Risk assets took a hit in U.S. trade on Friday following news the Trump administration is considering radical new financial pressure tactics on Beijing, including the possibility of delisting Chinese companies from U.S. stock exchanges. Trading in Chinese markets was quiet ahead of a long break. Chinese share markets will trade only on Monday this week ahead of the country’s National Day holiday, which runs until Oct. 7. There were mixed signals from China’s manufacturing surveys on Monday, which showed sustained weakness in exports and surprising improvement in domestic consumption indicators, and a Chinese central bank statement briefly hinting at plans for more simulative policies. The delisting of Chinese companies from U.S. stock exchanges was part of a broader effort to limit U.S. investment in Chinese companies; two sources briefed on the matter told Reuters. A U.S. Treasury official said the United States does not currently plan to stop Chinese companies from listing on U.S. exchanges, Bloomberg reported on Saturday. Still, with trade talks between the United States and China expected to be held Oct. 10-11, many market players are hoping such drastic measures on capital markets will be avoided. U.S. data on Friday showed consumer spending barely rose in August and business investment remained weak, suggesting the American economy was losing momentum as the trade dispute drags on. Industrial output in Japan and South Korea, released Monday morning, dropped more than expected, underscoring the headwinds from the trade war Investors are also keeping a wary eye on U.S. politics. U.S. House Speaker Nancy Pelosi said public opinion is now on the side of an impeachment inquiry against Trump following the release of new information about his conversations with Ukrainian President Volodymyr Zelenskiy. Boris Johnson said on Sunday he would not quit as Britain’s prime minister even if he fails to secure a deal to leave the European Union, insisting only his Conservative government can deliver Brexit on Oct. 31.
  • Oil prices gained on Monday in Asia as positive China data eased demand concerns. Meanwhile, China’s September official Manufacturing Purchasing Managers’ Index (PMI) and the Caixin Manufacturing PMI were both higher than expected, data showed on Monday. The better-than-expected data eased concerns about demand in the world’s biggest oil importer and sent prices higher. Oil prices were already gaining after Iranian President Hassan Rouhani was quoted by Reuters as saying that U.S. President Donald Trump had offered to lift all sanctions on Iran in return for talks. However, Trump later tweeted that he had agreed to no such thing. Limiting gains in oil prices were reports that Saudi Arabia would agree to a ceasefire in Yemen, which could result in much less war risk premium for oil. As Saudi’s oil production is now reportedly mostly back, traders’ focus shifted to developments in the Sino-U.S. trade war. Reports on the weekend said officials from the U.S. government are considering limiting American money flows into China. That includes the possibility of blocking all American investment in Chinese companies, CNBC reported citing unnamed sources. Liu He, China’s top trade negotiator, is due to head to the U.S. in October for a new round of trade talks. Oil prices slipped on Monday as China's economic outlook remained weak even as manufacturing data improved as an ongoing trade war with the United States weighs on demand growth at the world's largest crude importer. The official Purchasing Managers' Index (PMI) rose to 49.8 in September, slightly better than expected and advancing from 49.5 in August. But it remained below the 50-point mark that separates expansion from contraction on a monthly basis, data from the National Bureau of Statistics (NBS) showed. The PMI data "remained in the contractionary territory for the 5th month in a row, indicating that economic fundamentals were still weak," Citi analysts said in a note. World's top oil exporter Saudi Arabia has restored capacity to 11.3 million barrels per day, sources told Reuters last week although Saudi Aramco has yet to confirm it is fully back online. While Saudi Arabia is maintaining exports by using crude from inventories and spare production capacity, how much of it is actually restored could only be determined in the next few weeks, he added. Saudi Arabia's crown prince warned in an interview broadcast on Sunday that oil prices could spike to "unimaginably high numbers" if the world does not come together to deter Iran, but said he would prefer a political solution to a military one.

 

 
Intraday RESISTANCE LEVELS
30th September 2019 R1 R2 R3
GOLD-XAU 1,500-1,509 1,520 1,532-1,539
Silver-XAG 17.80-18.50 18.90 19.20-19.65
Crude Oil 56.60-57.00 57.60 58.20-59.00
EURO/USD 1.0960-1.1030 1.1090 1.1130-1.1180
GBP/USD 1.2310-1.2350 1.2400 1.2440-1.2505
USD/JPY 108.00 108.50 108.90-109.55

Intraday SUPPORTS LEVELS
30th September 2019 S1 S2 S3
GOLD-XAU 1,489-1,478 1,466 1,460
Silver-XAG 16.70 16.70 16.25-16.00
Crude Oil 55.90-55.40 54.95 54.25-53.90
EURO/USD 1.0910-1.0860 1.0805 1.0740
GBP/USD 1.2260 1.2205 1.2165-1.2100
USD/JPY 107.50-107.00 106.50 106.10-105.50

Intra-Day Strategy (30th September 2019)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Buy
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Friday made its intraday high of US$1507.35/oz and low of US$1486.81/oz. Gold down by 0.497% at US$1496.86/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 neutral 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 1589-1460 with risk below 1460, targeting 1500-1509-1520 and 1532-1539-1550. Sell below 1500-1550 keeping stop loss closing above 1550, targeting 1489-1480 and 1466-1460..

 
Intraday Support Levels
S1     1,489-1,478
S2     1,466
S3     1,460
Intraday Resistance Levels
R1     1,500-1,509
R2     1,520
R3     1,532-1,539

Technical Indicators

Name   Value Action
14DRSI  

45.806

Buy
20-DMA   1507.66 Sell
50-DMA  

1493.79

Sell
100-DMA   1425.24 Buy
200-DMA   1360.75 Buy
STOCH(5,3)   16.745 Sell
MACD(12,26,9)   1.259 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$17.88/oz and low of US$17.28/oz. Silver settled down by 1.539% at US$17.52/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 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 17.30-16.00 targeting 17.80-18.50-18.90 and 19.20-19.65-20.05; stop breakage below 16.60. Sell below 17.30-16.30 with stop loss above 16.00; targeting 17.40-17.00-16.70 and 16.25-16.00.

 
Intraday  Support Levels
S1     16.70
S2     16.70
S3     16.25-16.00

Intraday  Resistance Levels
R1     17.80-18.50
R2     18.90
R3     19.20-19.65

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.112 Buy
20-DMA   18.21 Buy
50-DMA   17.43 Buy
100-DMA   16.16 Buy
200-DMA   15.74 Buy
STOCH(5,3)   15.246 Sell
MACD(12,26,9)   0.194 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$56.67/bbl, intraday low of US$53.33/bbl and settled down by 0.655% to close at US$56.03/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 200DMA i.e. 56.35 which is a resistance level and breakage above will call for 57.00-58.00. MACD is above zero line and histograms are in increasing mode will bring bullish 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 neutral region and more downside can be expected to reach the oversold region, which is highly probable.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy above 55.90-53.90 with risk daily closing below 53.90 and targeting 56.60-57.00-57.60 and 58.20-59.00-60.20. Sell below 56.60-60.40 with stop loss at 60.40; targeting 55.90-55.40-54.50.

 
Intraday Support Levels
S1     55.90-55.40
S2     54.95
S3     54.25-53.90

Intraday Resistance Levels
R1     56.60-57.00
R2     57.60
R3     58.20-59.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.413 Sell
20-DMA   56.79 Buy
50-DMA   55.94 Buy
100-DMA   56.71 Buy
200-DMA   56.64 Buy
STOCH(5,3)   19.130 Sell
MACD(12,26,9)   0.555 Sell

EUR/USD

AAFX TRADING

EUR/USD of Friday made an intraday low of US$1.0904/EUR, high of US$1.0958/EUR and settled the day up by 0.175% to close at US$1.0938/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.1129), which become immediate resistance level, break above will target 1.1180-1.1260. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in neutral 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 right now.

Trading Strategy: Neutral to Buy

Buy above 1.0960-1.0815 with risk below 1.0815, targeting 1.1030-1.1090-1.1130 and 1.1160-1.1200. Sell below 1.1030-1.1250 targeting 1.1030-1.1000-1.0940 and 1.0910-1.0860 with stop-loss at daily closing above 1.1250.

 
Intraday Support Levels
S1     1.0910-1.0860
S2     1.0805
S3     1.0740

Intraday  Resistance Levels
R1     1.0960-1.1030
R2     1.1090
R3     1.1130-1.1180

TECHNICAL INDICATORS
Name   Value Action
14DRSI   35.755 Buy
20-DMA   1.1015 Sell
50-DMA   1.1080 Sell
100-DMA   1.1162 Sell
200-DMA   1.1240 Sell
STOCH(5,3)   6.958 Sell
MACD(12,26,9)   -0.0026 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2270/GBP, high of US$1.2335/GBP and settled the day down by 0.284% to close at US$1.2288/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 1.2310-1.2510 with targets at 1.2260-1.2205 and 1.2165-1.2100 stop-loss should be below 1.2510. Buy above 1.2260-1.2100 with targets 1.2310-1.2350-1.2400 and 1.2440-1.2505-1.2570 with stop loss closing below 1.2100.

 
Intraday Support Levels
S1     1.2260
S2     1.2205
S3     1.2165-1.2100

Intraday Resistance Levels
R1     1.2310-1.2350
R2     1.2400
R3     1.2440-1.2505

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

46.721

Buy
20-DMA   1.2366 Buy
50-DMA   1.2726 Buy
100-DMA   1.2726 Sell
200-DMA   1.2726 Sell
STOCH(5,3)   7.450 Sell
MACD(12,26,9)   -0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY107.65/USD and made an intraday high of JPY108.17/USD and settled the day up by 0.083% at JPY107.91/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 108.00-109.55 with risk above 110.00 targeting 107.50-107.00-106.50 and 106.10-105.50. Long positions above 107.50-105.00 with targets of 108.00-108.50-108.90 and 109.55-110.00 with stop below 105.00.

 
Intraday Support Levels
S1     107.50-107.00
S2     106.50
S3     106.10-105.50

INTRADAY RESISTANCE LEVELS
R1     108.00
R2     108.50
R3     108.90-109.55

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.821 Buy
20-DMA   107.37 Sell
50-DMA   107.06 Sell
100-DMA   107.82 Buy
200-DMA   109.20 Sell
STOCH(9,6)   37.253 Sell
MACD(12,26,9)   0.2417 Buy

AAFX TRADING
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