AAFX TRADING

Daily Market Lookup

  • Asian stocks edged up on Monday, catching some of Wall Street’s momentum after surprisingly strong U.S. jobs data, although regional gains were capped by concerns about China’s economic slowdown due to the prolonged Sino-U.S. trade war. U.S. job growth increased by the most in 10 months in November as the healthcare industry boosted hiring and production workers at General Motors returned to work after a strike, in the strongest sign that the world’s largest economy is in no danger of stalling Beijing hopes that it can reach a trade agreement with the United States that satisfies both sides as soon as possible, China’s Assistant Commerce Minister Ren Hongbin said on Monday. Top White House economic adviser Larry Kudlow said on Friday that a Dec. 15 deadline is still in place to impose a new round of U.S. tariffs on Chinese consumer goods, but President Donald Trump likes where trade talks with China are going. Still, investors think things could change if trade tensions escalate further, especially if Trump goes ahead with the planned tariffs on some $156 billion worth of products from China in mid-December. The market has been largely working on the assumption that those tariffs, which cover several consumer products such as cellphones and toys, will be dropped or at least postponed, given that Washington and Beijing agreed in October to work on a trade deal. Meanwhile, China’s exports shrank for the fourth consecutive month in November, sending shivers through a market already concerned about damage being done to global demand by the trade war. But growth in imports was seen as a possible sign that Beijing’s stimulus efforts over the last two years were helping to stir demand. The Federal Reserve’s Open Market Committee (FOMC) kicks off its two-day policy meeting on Tuesday. The central bank is expected to highlight the economy’s resilience and keep interest rates on hold in the range of 1.50% to 1.75%. Analysts said the much better-than-expected jobs report offset mixed signals from recent economic data and validated the Fed’s wait-and-see stance on interest rates after three “insurance cuts” this year. Sterling has been bolstered by expectations that Prime Minister Boris Johnson’s Conservative Party will win an outright majority in the upcoming election on Thursday, thereby ending a hung parliament and political paralysis on Brexit.
  • The U.S. dollar and the euro were little changed on Monday in Asia as traders await central bank meetings due later this week. The Federal Reserve is expected to keep rates steady on Wednesday this week at the conclusion of its policy meeting. The Fed has cut rates three times this year to shield the U.S. economy from a global slowdown. After the last rate cut, in October, Fed Chair Jerome Powell said both the economy and policy were in a "good place" and indicated that policymakers saw little need to cut rates further. On the data front, The American consumer price inflation figures is due this week ahead of the Fed meeting, which are expected to show inflation running at 2%, while retail sales numbers on Friday are forecast to show growth of 0.4%. The ECB is not expected to make any significant change to monetary policy. However, traders will pay attention to Lagarde’s wordings for her thoughts on the monetary policy outlook, the economy and an upcoming strategy review. The dollar held firm on Monday after data showed surprise strength in the U.S. jobs market, but the currency was restrained from moving higher by worries about an escalation in the U.S.-China trade war. U.S. nonfarm payrolls increased by 266K jobs last month, the biggest gain in 10 months, while the unemployment rate ticked back down to 3.5%, its lowest level in nearly half a century. Those figures suggested the Trump administration's 17-month trade war with China, which has plunged manufacturing into recession, has not yet spilled over to the broader U.S. economy Still, investors think that could change if trade tensions escalate further, especially if Trump goes ahead with planned tariffs on some $156 billion worth of products from China from Dec. 15. The market has been largely working on the assumption that those tariffs, which cover several consumer products such as cellphones and toys, will be dropped or at least postponed, given that Washington and Beijing agreed in October to work on a trade deal. Top White House economic adviser Larry Kudlow confirmed on Friday that the Dec. 15 deadline to impose the new tariffs remains in place, but added that President Donald Trump likes where trade talks with China are going. China's exports shrank for the fourth consecutive month in November, underscoring persistent pressures on manufacturers from the Sino-U.S. trade war. The currency has been bolstered by expectations that Prime Minister Boris Johnson's Conservative Party will win an outright majority in the upcoming election on Thursday, thereby ending a hung parliament and political paralysis on Brexit.
  • Oil prices dropped on Monday in Asia but are still near 12-week highs after OPEC+ agreed to bigger output cuts than expected. During Friday’s meeting, Saudi Arabia agreed to provide 400,000 bpd of their own cuts, a significant supply cut beyond what was agreed to with fellow OPEC+ members, if OPEC+ averaged its part of 1.7 million bpd through the first quarter of 2020. Crude prices surged on the news, with the U.S. WTI jumping 7.3% on the week. It was WTI’s largest weekly gain since mid-June. U.K. Brent gained 3.1% on the week. Goldman Sachs raised its 2020 Brent forecast following the move, adding that it sees a change in OPEC+ strategy to managing short-term physical imbalances. Oil prices retreated today as data showed exports in China declined for the fourth consecutive month, raising concerns that demand for oil might fall. The data came as Beijing and Washington aim to reach a “phase one” trade deal that has so far remained elusive ahead of a Dec. 15 deadline, when additional tariffs will be imposed on Chinese goods.

 

 
Intraday RESISTANCE LEVELS
9th December 2019 R1 R2 R3
GOLD-XAU 1,468-1,474 1,494 1,500-1.509
Silver-XAG 16.75-17.30 17.60 17.80-18.10
Crude Oil 59.00-59.70 60.30 60.70-61.25
EURO/USD 1.1110 1.1175 1.1200-1.1230
GBP/USD 1.3170-1.3200 1.3250 1.3300-1.3350
USD/JPY 109.00 109.50 110.00-110.70

Intraday SUPPORTS LEVELS
9th December 2019 S1 S2 S3
GOLD-XAU 1,458 1,452-1,442 1,436
Silver-XAG 16.25-15.90 15.50 14.90
Crude Oil 58.65-57.80 57.20 56.00-56.50
EURO/USD 1.1060-1.0980 1.0930 1.0890-1.0850
GBP/USD 1.3100-1.3040 1.2970 1.2900-1.2840
USD/JPY 108.50 107.80-107.00 106.40

Intra-Day Strategy (9th 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$1479.60/oz and low of US$1458.65/oz. Gold down 1.072% at US$1459.91/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 1458-1442 with risk below 1442, targeting 1468-1474-1489 and 1500-1509. Sell below 1468-1509 keeping stop loss closing above 1510, targeting 1458-1452 and 1442-1438.

 
Intraday Support Levels
S1     1,458
S2     1,452-1,442
S3     1,436
Intraday Resistance Levels
R1     1,468-1,474
R2     1,494
R3     1,500-1.509

Technical Indicators

Name   Value Action
14DRSI  

44.882

Buy
20-DMA   1465.66 Sell
50-DMA  

1481.22

Sell
100-DMA   1487.39 Sell
200-DMA   1405.65 Buy
STOCH(5,3)   36.621 Buy
MACD(12,26,9)   -8.241 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$17.00/oz and low of US$16.51/oz settled down by 2.20% at US$16.56/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 16.25-14.90 targeting 16.75-17.30-17.60 and 17.80-18.50; stop breakage below 14.90. Sell below 16.75-19.30 with stop loss above 19.00; targeting 16.25-16.00 and 15.70-14.90.

 
Intraday  Support Levels
S1     16.25-15.90
S2     15.50
S3     14.90

Intraday  Resistance Levels
R1     16.75-17.30
R2     17.60
R3     17.80-18.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   37.313 Buy
20-DMA   16.93 Sell
50-DMA   17.31 Sell
100-DMA   17.39 Sell
200-DMA   16.22 Buy
STOCH(5,3)   13.268 Sell
MACD(12,26,9)   -0.170 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US$59.74/bbl, intraday low of US$57.62/bbl and settled up by 1.294% to close at US$59.00/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 58.65-56.10 with risk daily closing below 56.10 and targeting 59.00-59.70 and 60.30-60.70-61.25. Sell below 59.00-61.25 with stop loss at 61.20; targeting 58.50-57.80-57.20 and 56.00-55.10-54.50.

 
Intraday Support Levels
S1     58.65-57.80
S2     57.20
S3     56.00-56.50

Intraday Resistance Levels
R1     59.00-59.70
R2     60.30
R3     60.70-61.25

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.638 Sell
20-DMA   57.38 Sell
50-DMA   55.73 Buy
100-DMA   55.56 Buy
200-DMA   57.56 Sell
STOCH(5,3)   81.130 Sell
MACD(12,26,9)   0.307 Sell

EUR/USD

AAFX TRADING

EUR/USD of Friday an intraday low of US$1.10739EUR, high of US$1.1109/EUR and settled the day down by 0.409% to close at US$1.1058/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 1.1060-1.0850 with risk below 1.1060, targeting 1.1110-1.1170 and 1.1200-1.1230. Sell below 1.1110-1.1300 targeting 1.1060-1.1030-1.0960 and 1.0860-1.0805 with stop-loss at daily closing above 1.1300.

 
Intraday Support Levels
S1     1.1060-1.0980
S2     1.0930
S3     1.0890-1.0850

Intraday  Resistance Levels
R1     1.1110
R2     1.1175
R3     1.1200-1.1230

TECHNICAL INDICATORS
Name   Value Action
14DRSI   51.357 Buy
20-DMA   1.1045 Sell
50-DMA   1.1054 Sell
100-DMA   1.1064 Sell
200-DMA   1.1155 Sell
STOCH(5,3)   87.958 Sell
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.3099/GBP, high of US$1.3164/GBP and settled the day down by 0.141% to close at US$1.3137/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2769) 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 1.3170-1.3350 with targets at 1.3100-1.3040-1.2900 and 1.2840-1.2790 stop-loss should be below 1.3170. Buy above 1.3100-1.2840 with targets 1.3200-1.3250 and 1.3300-1.3350 with stop loss closing below 1.2600.

 
Intraday Support Levels
S1     1.3100-1.3040
S2     1.2970
S3     1.2900-1.2840

Intraday Resistance Levels
R1     1.3170-1.3200
R2     1.3250
R3     1.3300-1.3350

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

72.940

Buy
20-DMA   1.2952 Buy
50-DMA   1.2803 Buy
100-DMA   1.2530 Buy
200-DMA   1.2694 Buy
STOCH(5,3)   94.191 Buy
MACD(12,26,9)   0.0049 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY108.48/USD and made an intraday high of JPY108.91/USD and settled the day down by 0.157% at JPY108.58/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 109.00-111.70 with risk above 111.90 targeting 108.80-108.50-107.80 and 107.00-106.50. Long positions above 108.80-107.00 with targets of 109.00-109.50-110.00 and 110.70-111.30 with stop below 107.00.

 
Intraday Support Levels
S1     108.50
S2     107.80-107.00
S3     106.40

INTRADAY RESISTANCE LEVELS
R1     109.00
R2     109.50
R3     110.00-110.70

TECHNICAL INDICATORS
Name   Value Action
14DRSI   48.367 Buy
20-DMA   108.87 Sell
50-DMA   108.52 Buy
100-DMA   107.79 Buy
200-DMA   108.85 Sell
STOCH(9,6)   27.253 Buy
MACD(12,26,9)   0.206 Buy

AAFX TRADING
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