AAFX TRADING

Daily Market Lookup

  • Global shares shuffled marginally higher on Monday to stand just short of the record peak struck in January 2018, with buyers encouraged by upbeat China manufacturing surveys and hopes that China and the United States will agree a preliminary trade deal. The market enjoyed a boost after the Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) index rose to 51.8 in November from 51.7 in the previous month, marking the fastest expansion since December 2016. While U.S. legislation supporting Hong Kong protesters last week raised concerns about U.S.-China trade negotiations, investors are nonetheless holding the broad view that a further escalation in the trade war can be avoided. nvestors have long thought that the United States will avoid imposing an additional 15% tariff on about $156 billion of Chinese products on Dec. 15 after signing a deal with China. The two countries have been so far unable to bridge the gap over existing tariffs on Chinese goods, with Beijing demanding scrapping them as a part of any trade deal. A trade deal between United States and China was now “stalled because of Hong Kong legislation”, news website Axios reported on Sunday, citing a source close to U.S. President Donald Trump’s negotiating team. China’s Foreign Ministry last week lambasted U.S. legislation signed by President Donald Trump on Wednesday backing protesters in Hong Kong as a serious interference in Chinese affairs. In the currency market the yen weakened, helped also by expectations that Japan could put together a large-scale fiscal spending package to bolster its economy. The British pound slipped 0.22% to $1.2914 GBP=D4 after opinion polls during the weekend showed Prime Minister Boris Johnson's Conservative Party saw its lead over the opposition Labour Party narrow. Oil prices bounced back a tad after a big slump on Friday on record high U.S. crude production. The market drew support from expectations that OPEC and its allies are likely to extend existing oil output cuts when they meet this week , with non-OPEC oil producer Russia supporting Saudi Arabia’s push for stable oil prices amid the listing of state oil giant Saudi Aramco. Iraq’s oil minister said on Sunday that OPEC and allied producers will consider deepening their existing oil output cuts by about 400,000 barrels per day (bpd) to 1.6 million bpd.
  • The Chinese yuan stayed relatively steady as forex markets began December with good news from China’s economy. China’s Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) was recorded at 51.8 in November, up from a reading of 51.7 in October. On Friday, the official manufacturing PMI released by the National Bureau of Statistics (NBS) recorded a reading of 50.2, topping the 50 level that suggests expansion for the first time since April. The official non-manufacturing PMI came in at 54.4, the highest level since March. The US dollar stayed little changed on Monday in Asia following the release of strong economic data in the US the previous week. The US Dollar Index traded marginally higher early in the day, up 0.03% to 98.20 by 8:41 PM ET (01:40 GMT). US-China trade talks remained in focus after the Global Times, a nationalist English-language tabloid in China with links to the Communist Party of China, tweeted that any phase one trade deal would require that the US roll back tariffs. The next batch of American tariffs on Chinese goods are due to take effect on Dec. 15. Last week, U.S. President Donald Trump approved two bills that back Hong Kong’s anti-government protestors. The bills are mainly symbolic and have limited practical implications, but China has vowed to take strong measures in retaliation, although it has not yet announced any specific responses.
  • Oil prices rose more than 1% on Monday as signs of rising manufacturing activity in China pointed to increasing fuel demand, and hints that OPEC may deepen output cuts at its meeting this week indicated supply may tighten next year. On Friday, WTI futures settled 5.1% lower while Brent plunged 4.4% on concerns that talks to end the trade war between the United States and China, the world's two biggest oil users, would be disrupted by U.S. support for protesters in Hong Kong. But oil rose on Monday after factory activity in November in China, the world's biggest oil importer, increased for the first time in seven months because of rising domestic demand amid government stimulus measures. Prices were also supported after Iraq's oil minister said on Sunday that OPEC and allied producers will consider deepening their existing oil output cuts by about 400,000 barrels per day (bpd) to 1.6 million bpd. The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, known as OPEC+, are expected to at least extend existing output cuts to June 2020 when they meet this week. The OPEC+ group has coordinated output for three years to balance the market and support prices. Their current deal to cut supply by 1.2 million bpd that started from January expires at the end of March 2020. OPEC's ministers will meet in Vienna on Dec. 5 and the wider OPEC+ group will meet on Dec. 6. Ministers will either take no action, extend the cuts without change, or deepen them, ING Economics said in a note. OPEC oil output fell in November as Angolan production slipped due to maintenance and Saudi Arabia kept a lid on supply to support prices before the initial public offering of state-owned Saudi Aramco, a Reuters survey found. On average, OPEC pumped 29.57 million bpd last month, according to the survey, down 110,000 bpd from October's revised figure. But U.S. production keeps rising, filling the gaps left by OPEC, with output in September increasing to a new record of 12.46 million barrels per day (bpd), the U.S. government said in a monthly report on Friday.

 

 
Intraday RESISTANCE LEVELS
2nd December 2019 R1 R2 R3
GOLD-XAU 1,462-1,470 1,478 1,494-1,500
Silver-XAG 17.30-17.60 17.80 18.10-18.50
Crude Oil 57.20 57.20 57.80--58.65
EURO/USD 1.1030-1.1110 1.1175 1.1200-1.1230
GBP/USD 1.2970 1.3040 1.3100-1.3150
USD/JPY 109.50-110.00 110.70 111.30-111.90

Intraday SUPPORTS LEVELS
2nd December 2019 S1 S2 S3
GOLD-XAU 1,452 1,442-1,438 1,430
Silver-XAG 15.90 15.90 15.50
Crude Oil 55.10-54.50 53.70 52.90
EURO/USD 1.0980 1.0850 1.0850
GBP/USD 1.2900-1.2840 1.2790 1.2710-1.2650
USD/JPY 109.30-108.80 108.50 107.80-107.00

Intra-Day Strategy (2nd December 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$1466.48/oz and low of US$1453.00/oz. Gold up 0.551% at US$1463.86/oz.

Technicals in Focus:

In daily charts, prices are below 100DMA (1483) and breakage above will call for 1492. MACD is below zero line but histograms are increasing trend and it will bring upward 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 1459-1438 with risk below 1438, targeting 1478-1489 and 1500-1512. Sell below 1470-1512 keeping stop loss closing above 1512, targeting 1470-1459-1452 and 1442-1438.

 
Intraday Support Levels
S1     1,452
S2     1,442-1,438
S3     1,430
Intraday Resistance Levels
R1     1,462-1,470
R2     1,478
R3     1,494-1,500

Technical Indicators

Name   Value Action
14DRSI  

41.882

Buy
20-DMA   1475.42 Sell
50-DMA  

1488.58

Sell
100-DMA   1483.32 Sell
200-DMA   1399.26 Buy
STOCH(5,3)   23.621 Sell
MACD(12,26,9)   -8.241 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$17.03/oz and low of US$16.84/oz. settled up by 0.520% at US$16.99/oz.

Technicals in Focus:

On daily charts, silver is sustaining below 100DMA (17.15), breakage above will lead to 17.61. 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 neutral 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 16.75-15.50 targeting 17.30-17.60-17.80 and 18.50-18.90; stop breakage below 15.60. Sell below 17.30-19.30 with stop loss above 19.50; targeting 16.90-16.25 and 16.00-15.70.

 
Intraday  Support Levels
S1     15.90
S2     15.90
S3     15.50

Intraday  Resistance Levels
R1     17.30-17.60
R2     17.80
R3     18.10-18.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.313 Buy
20-DMA   17.41 Sell
50-DMA   17.56 Sell
100-DMA   17.20 Sell
200-DMA   16.14 Buy
STOCH(5,3)   86.268 Buy
MACD(12,26,9)   -0.179 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$58.14/bbl, intraday low of US$54.97/bbl and settled down by 5.09% to close at US$55.17/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 overbought region and giving positive crossover for confirmation of bullish 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 55.10-52.90 with risk daily closing below 52.70 and targeting 56.00-56.50-57.20 and 57.80-58.65-59.40. Sell below 56.00-58.65 with stop loss at 59.00; targeting 55.10-54.50-53.70 and 52.90-52.00.

 
Intraday Support Levels
S1     55.10-54.50
S2     53.70
S3     52.90

Intraday Resistance Levels
R1     57.20
R2     57.20
R3     57.80--58.65

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.638 Sell
20-DMA   57.10 Sell
50-DMA   55.63 Buy
100-DMA   55.86 Buy
200-DMA   57.52 Sell
STOCH(5,3)   22.130 Sell
MACD(12,26,9)   0.307 Sell

EUR/USD

AAFX TRADING

EUR/USD of Friday an intraday low of US$1.0980/EUR, high of US$1.1027/EUR and settled the day up by 0.0972% to close at US$1.1017/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 50DMA (1.1040), 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 oversold 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 1.0990-1.0850 with risk below 1.0900, targeting 1.1030-1.1060-1.1110 and 1.1170-1.1200. Sell below 1.1030-1.1300 targeting 1.1030-1.0960 and 1.0860-1.0805 with stop-loss at daily closing above 1.1300.

 
Intraday Support Levels
S1     1.0980
S2     1.0850
S3     1.0850

Intraday  Resistance Levels
R1     1.1030-1.1110
R2     1.1175
R3     1.1200-1.1230

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.357 Buy
20-DMA   1.1055 Sell
50-DMA   1.1040 Sell
100-DMA   1.1079 Sell
200-DMA   1.1167 Sell
STOCH(5,3)   12.958 Sell
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2878/GBP, high of US$1.2941/GBP and settled the day down by 0.182% to close at US$1.2932/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2715) 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 neutral territory and giving positive crossover to confirm bullish 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 1.2970-1.3170 with targets at 1.2900-1.2840-1.2790 and 1.2710-1.2650 stop-loss should be below 1.3170. Buy above 1.2840-1.2600 with targets 1.2900-1.2970-1.3040 and 1.3100-1.3150 with stop loss closing below 1.2600.

 
Intraday Support Levels
S1     1.2900-1.2840
S2     1.2790
S3     1.2710-1.2650

Intraday Resistance Levels
R1     1.2970
R2     1.3040
R3     1.3100-1.3150

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

57.878

Buy
20-DMA   1.2893 Buy
50-DMA   1.2715 Buy
100-DMA   1.2494 Buy
200-DMA   1.2698 Buy
STOCH(5,3)   69.191 Buy
MACD(12,26,9)   0.0049 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY109.39/USD and made an intraday high of JPY109.66/USD and settled the day down by 0.120% at JPY109.50/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (107.70), 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 109.50-111.70 with risk above 111.90 targeting 109.30-108.50-107.80 and 107.00-106.50. Long positions above 109.30-107.00 with targets of 109.50-110.00-110.70 and 111.30-111.90 with stop below 107.00.

 
Intraday Support Levels
S1     109.30-108.80
S2     108.50
S3     107.80-107.00

INTRADAY RESISTANCE LEVELS
R1     109.50-110.00
R2     110.70
R3     111.30-111.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   63.367 Buy
20-DMA   108.93 Buy
50-DMA   108.41 Buy
100-DMA   107.75 Buy
200-DMA   108.91 Sell
STOCH(9,6)   92.253 Buy
MACD(12,26,9)   0.206 Buy

AAFX TRADING
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