AAFX TRADING

Daily Market Lookup

  • Asian stocks edged up on Monday as Chinese shares reversed early losses, supported by hopes for progress in resolving the U.S.-China trade war, while sterling slipped after the British parliament delayed a crucial vote on a Brexit withdrawal deal. The pound slipped from a five-month high against the dollar and the euro after the British parliament forced Prime Minister Boris Johnson to seek a delay to an Oct. 31 deadline for Britain’s departure from the bloc. The vote for an extension dealt a blow to optimism that a deal agreed last week would ensure Brexit happens with little economic disruption. Oil futures fell as lingering economic growth concerns and excess supplies of crude prompted speculators to trim their long positions. The Chinese stock market appeared to take some encouragement from comments by Chinese vice premier Liu He on Friday that Beijing will work with the United States to address each other’s concerns, and that stopping the trade war would be good for both sides and the world. Also on Friday, U.S. President Donald Trump said he thinks a trade deal between the United States and China will be signed by the time Asia-Pacific Economic Cooperation meetings take place in Chile on Nov. 16-17. Shares in Hong Kong also got a lift after Chinese bourses revised rules to allow mainland investors to buy Hong Kong-listed dual-class shares for the first time. The 15-month long dispute over China’s trade and industrial policies has shown few signs ending despite several rounds of talks. Financial markets have been whipsawed over this period as a steady increase in tit-for-tat tariffs have slowed global trade and raised the risk of recession for some countries Underscoring the damage, Japan’s exports fell in September for the 10th straight month, while South Korea’s exports for the first 20 days of October dived 19.5% year-on-year, data on Monday showed. The British government insists Brexit will take place on Oct. 31, but uncertainty over how British lawmakers will respond could weigh on sentiment for sterling. The leader of the House of Commons says the government plans to put the new Brexit deal to a debate and vote on Monday, but it is unclear if the speaker of the House will let this happen Money managers cut their net long U.S. crude futures and options positions in the week to Oct. 15, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday. Long bets on U.S. crude have dropped sharply in the last two weeks after a spate of weak economic figures worldwide fanned concerns about global energy demand.
  • The British pound fell against the U.S. dollar on Monday in Asia after U.K. Prime Minister Boris Johnson failed to win parliamentary backing for his divorce deal. U.K. lawmakers voted on Saturday to withhold on Johnson’s deal. Despite the delay, markets remained confident that a no-deal exit from the EU would be avoided. Foreign Secretary Dominic Raab told the BBC overnight that he was confident enough lawmakers would back the deal this week Goldman Sachs said on Sunday that it lowered the probability of a no-deal Brexit to 5% from 10%. Sino-U.S. trade tensions remained in focus. China Vice Premier Liu He said it has made “substantial progress” with the U.S. and that the two sides “laid the foundation for a phase one agreement.” It was reported last Friday that China’s gross domestic product grew 6% annually in the third quarter, which was the slowest rate in 30 years. The news comes on the back of China trying to get more concessions from the U.S. before it signs a temporary phase 1 deal agreed on last week. The U.S. dollar was lower against other currencies on Friday, while the euro was buoyed by hope that a Brexit deal will help mitigate risks of a recession in the bloc. U.K. Prime Minister Boris Johnson made a deal with the EU on Thursday, which hinges on Northern Ireland applying a limited set of EU rules on some goods, with the U.K. only charging EU tariffs on goods passing through to EU markets. The deal now must be passed by the British Parliament on Saturday. However, Northern Ireland's Democratic Unionist Party said it is opposed to the proposed agreement, making it uncertain if the deal will be approved. Meanwhile the U.S. dollar dipped, as traders remained cautious after data showed the impact of the trade war has taken its toll on China. China’s gross domestic product grew 6% annually in the third quarter, which was the slowest rate in 30 years. The news comes on the back of China trying to get more concessions from the U.S. before it signs a temporary phase 1 deal agreed on last week.
  • Oil prices eased on Monday amid persistent concerns about the global economic outlook and the impact on oil demand, while Russia again missed its target to cut oil output last month. Signs of still ample global oil supply combined with concerns about economic growth in China, the world's largest oil importer, pressured prices lower for a second session Russia, the world's second-largest oil producer, said on Sunday it did not meet its supply reduction commitment in September because of an increase in natural gas condensate output as the country prepared for winter. The Organization of the Petroleum Exporting Countries (OPEC), Russia and other oil producers, an alliance known as OPEC+, agreed in December to reduce supply by 1.2 million barrels per day (bpd) from the start of this year. Additionally, talks between OPEC members Kuwait and Saudi Arabia to restart oil production from joint fields in the Neutral Zone between the two countries, with capacity of 500,000 barrels per day could mean more supply returning to the market. Kuwait's deputy foreign minister on Saturday said negotiations were "very positive" after Kuwaiti media, citing unidentified sources, said the two Gulf oil producers had agreed to resume crude output from the oilfields. But any increase in Neutral Zone production from will be compensated by a supply cut from other Saudi Arabian and Kuwaiti fields as both countries are committed to their targets under the OPEC+ output reduction agreement. While market participants believe OPEC+ could decide to extend production cuts in an upcoming December meeting, economic headwinds are curbing bullish sentiment and fuelling oil demand concerns. China's economic growth slowed to 6% year-on-year in the third quarter, its weakest in 27-1/2 years and short of expectations due to soft factory production and continuing trade tensions.

 

 
Intraday RESISTANCE LEVELS
21st October 2019 R1 R2 R3
GOLD-XAU 1,500 1,509 1,524-1,535
Silver-XAG 17.60-17.90 18.50 18.90-19.20
Crude Oil 53.90 54.95 55.30-56.00
EURO/USD 1.1180-1.1200 1.1250 1.1300
GBP/USD 1.2920-1.2990 1.3040 1.3100
USD/JPY 109.30-110.00 110.70 111.30

Intraday SUPPORTS LEVELS
21st October 2019 S1 S2 S3
GOLD-XAU 1,489-1,478 1,470 1,466-1,447
Silver-XAG 17.30-16.90 16.25 17.60-17.90
Crude Oil 53.30-52.70 52.10 51.50-50.60
EURO/USD 1.1140-1.1090 1.1050 1.0980-1.0930
GBP/USD 1.2865-1.2790 1.2710 1.2650-1.2600
USD/JPY 108.50-107.80 107.00 106.50-106.10

Intra-Day Strategy (21st October 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$1498.38/oz and low of US$1484.86/oz. Gold down by 0.0873% at US$1490.43/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 1478-1447 with risk below 1447, targeting 1489-1500-1509 and 1524-1535. Sell below 1489-1535 keeping stop loss closing above 1535, targeting 1478-1470 and 1466-1460-1447.

 
Intraday Support Levels
S1     1,489-1,478
S2     1,470
S3     1,466-1,447
Intraday Resistance Levels
R1     1,500
R2     1,509
R3     1,524-1,535

Technical Indicators

Name   Value Action
14DRSI  

47.882

Buy
20-DMA   1497.95 Sell
50-DMA  

1506.86

Sell
100-DMA   1454.42 Buy
200-DMA   1375.35 Buy
STOCH(5,3)   51.745 Sell
MACD(12,26,9)   -3.651 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$17.58/oz and low of US$17.39/oz. Silver settled up by 0.057% at US$17.54/oz.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.

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 17.30-15.70 targeting 17.80-18.50 and 18.90-19.20; stop breakage below 15.60. Sell below 17.70-19.30 with stop loss above 19.50; targeting 17.30-16.90 and 16.25-16.00-15.70.

 
Intraday  Support Levels
S1     17.30-16.90
S2     16.25
S3     17.60-17.90

Intraday  Resistance Levels
R1     17.60-17.90
R2     18.50
R3     18.90-19.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   48.112 Buy
20-DMA   17.62 Sell
50-DMA   17.74 Sell
100-DMA   16.66 Buy
200-DMA   15.94 Buy
STOCH(5,3)   49.268 Sell
MACD(12,26,9)   -0.075 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$54.65/bbl, intraday low of US$53.40/bbl and settled down by 0.007% to close at US$53.72/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 53.30-50.60 with risk daily closing below 50.40 and targeting 53.90-54.95 and 55.40-56.00. Sell below 53.90-56.00 with stop loss at 56.00; targeting 53.30-52.70-52.10 and 51.90-51.00.

 
Intraday Support Levels
S1     53.30-52.70
S2     52.10
S3     51.50-50.60

Intraday Resistance Levels
R1     53.90
R2     54.95
R3     55.30-56.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.864 Sell
20-DMA   53.91 Sell
50-DMA   55.28 Sell
100-DMA   55.63 Sell
200-DMA   57.14 Sell
STOCH(5,3)   58.130 Buy
MACD(12,26,9)   -0.664 Sell

EUR/USD

AAFX TRADING

EUR/USD of Friday made an intraday low of US$1.1114/EUR, high of US$1.1173/EUR and settled the day up by 0.451% to close at US$1.1173/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.1048), which become immediate resistance level, break above will target 1.1100. 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 1.1140-1.0930 with risk below 1.0900, targeting 1.1180-1.1200 and 1.1250-1.1300. Sell below 1.1140-1.1250 targeting 1.1090-1.1050-1.0960 and 1.0860-1.0805 with stop-loss at daily closing above 1.1250.

 
Intraday Support Levels
S1     1.1140-1.1090
S2     1.1050
S3     1.0980-1.0930

Intraday  Resistance Levels
R1     1.1180-1.1200
R2     1.1250
R3     1.1300

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.755 Buy
20-DMA   1.0992 Buy
50-DMA   1.1035 Buy
100-DMA   1.1137 Sell
200-DMA   1.1208 Sell
STOCH(5,3)   88.958 Buy
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2748/GBP, high of US$1.2988/GBP and settled the day up by 0.483% to close at US$1.2888/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 1.2865-1.3040 with targets at 1.2790-1.2710-1.2650 and 1.2600-1.2520 stop-loss should be below 1.3000. Buy above 1.2790-1.2440 with targets 1.2865-1.2920 and 1.2990-1.3040 with stop loss closing below 1.2100.

 
Intraday Support Levels
S1     1.2865-1.2790
S2     1.2710
S3     1.2650-1.2600

Intraday Resistance Levels
R1     1.2920-1.2990
R2     1.3040
R3     1.3100

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

70.234

Buy
20-DMA   1.2490 Buy
50-DMA   1.2355 Buy
100-DMA   1.2421 Sell
200-DMA   1.2713 Sell
STOCH(5,3)   87.450 Sell
MACD(12,26,9)   -0.0074 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY108.37/USD and made an intraday high of JPY108.71/USD and settled the day down by 0.208% at JPY108.39/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 109.00-110.70 with risk above 110.00 targeting 107.80-107.00-106.50 and 106.10-105.50. Long positions above 107.80-105.00 with targets of 108.70-109.30 and 110.00-110.70 with stop below 105.00.

 
Intraday Support Levels
S1     108.50-107.80
S2     107.00
S3     106.50-106.10

INTRADAY RESISTANCE LEVELS
R1     109.30-110.00
R2     110.70
R3     111.30

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.122 Buy
20-DMA   107.75 Sell
50-DMA   107.13 Sell
100-DMA   107.54 Buy
200-DMA   109.06 Buy
STOCH(9,6)   93.253 Sell
MACD(12,26,9)   0.303 Buy

AAFX TRADING
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