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Daily Market Lookup

  • Asian shares scaled eight-month peaks on Friday as a last-gasp Sino-U.S. trade deal and a likely major election win by Britain’s Conservative Party cleared a couple of dark clouds from the global horizon. The double dose of relief slugged safe-haven sovereign bonds and the Japanese yen, and led markets to scale back the chance of more interest rates cuts around the world. The pound hit its highest since mid-2018 as the run of UK vote results ruled out a shock win by the left-wing Labour opposition, which had been a worry for investors. Prime Minster Boris Johnson looked set to gain a commanding majority in Britain’s Parliament giving him the power to deliver Brexit, though trade talks with the European Union were set to drag on for months yet. A wave of trade euphoria had already lifted Wall Street to record highs. Reuters reported the United States has agreed to reduce some tariffs on Chinese goods and delay a tranche of tariffs as part of a phase one deal. China also has agreed to make $50 billion in agricultural purchases in 2020 as part of the deal, that person and another U.S. source familiar with the talks said. Interest rate futures <0#FF:> slipped as investors priced in less chance of a rate cut from the Federal Reserve next year - a shift seen across a range of developed nations including the UK. Other safe harbours also took a beating, with the yen sliding across the board. The dollar firmed further to 109.60 yen JPY= having risen 0.7% overnight.
  • The pound rose to a three-and-a-half year high versus the euro and the highest in more than a year versus the dollar after exit polls suggested a win for the Conservatives, which should help ensure the UK's smooth exit from the European Union. The Chinese yuan rose in offshore trade and the Japanese yen fell after a source told Reuters that the United States and China have agreed some tariff reductions and a delay on tariffs set to go effect on Dec. 15. The early results suggest the election will relieve almost four years of uncertainty about when Brexit would take place, which should be supportive of the pound. A successful scaling back of trade tension would relieve one major headwind to economic growth, which suggests lower demand for the safe-haven yen. Avoiding new tariffs should also be a boost to China's slowing economy, which should draw more investors to the yuan. The pound plunged more than 10% in the immediate aftermath of Britain's vote to leave the European Union in June 2016, while $2 trillion was wiped off world markets. The exit poll, which suggested UK Prime Minister Boris Johnson would get a majority of 86 - the largest of any Conservative leader since Margaret Thatcher won in the 1980s - should empower him to deliver Brexit on Jan. 31. Official results will be declared over the next seven hours. Even if Brexit is completed on Jan. 31, there is still some uncertainty because Britain will then enter a transition period during which it will negotiate a new relationship with the remaining 27 EU states. As part of the trade deal, China has also agreed to purchase $50 billion of U.S. agricultural goods next year, sources familiar with the talks told Reuters. The yuan rallied and the yen fell late on Thursday after Bloomberg News reported that U.S. President Donald Trump signed off on a trade deal with China that will delay a new round of tariffs scheduled for Dec. 15. A trade dispute between the United States and China over Chinese trading practices that Washington says are unfair has dragged on for almost two years, making the stand off the biggest risk to the global economy. The pound rose to a three-and-a-half year high versus the euro and the highest in more than a year versus the dollar after exit polls suggested a win for the Conservatives, which should help ensure the UK's smooth exit from the European Union. A successful scaling back of trade tension would relieve one major headwind to economic growth, which suggests lower demand for the safe-haven yen. Avoiding new tariffs should also be a boost to China's slowing economy, which should draw more investors to the yuan. The pound plunged more than 10% in the immediate aftermath of Britain's vote to leave the European Union in June 2016, while $2 trillion was wiped off world markets. Even if Brexit is completed on Jan. 31, there is still some uncertainty because Britain will then enter a transition period during which it will negotiate a new relationship with the remaining 27 EU states.
  • Oil prices extended gains on Friday, scaling three-month highs as the United States and China moved closer to a resolution to the 18-month trade war between the world's two biggest economies that has raised big questions about global demand for crude. Mirroring investor optimism, Asian share markets jumped to multi-month highs on Friday after Wall Street surged to record highs on Thursday. While a trade deal that would end uncertainty could provide a shot in the arm for oil demand in the near term, concerns continue to hover about the demand profile amid ample supplies going forward. "Lingering doubts about demand will cap the upside on prices," said ANZ Bank in a note on Friday. In the meantime the White House has agreed to suspend some tariffs on Chinese goods and reduce others in return for Beijing's pledge to hike purchases of U.S. farm products in 2020, sources said on Thursday. But the White House didn't release any official statement, raising questions about whether the terms had been agreed by both sides. Looking further ahead, an International Energy Agency report on Thursday pointed to future pressure on oil prices, predicting a sharp rise in global inventories despite an agreement by the Organization of the Petroleum Exporting Countries (OPEC) and its allies to deepen output cuts. That contrasts with OPEC's own research, which forecasts a small deficit in the market next year due to Saudi Arabia's supply restraint even before the latest cut agreement takes effect. Elsewhere, Norway's oil output in November hit a 32-month high at 1.71 million barrels per day, the Norwegian Petroleum Directorate (NPD) said on Thursday.

 

 
Intraday RESISTANCE LEVELS
13th December 2019 R1 R2 R3
GOLD-XAU 1,478 1,494 1,500-1,509
Silver-XAG 17.00-17.30 17.60 17.80-18.10
Crude Oil 59.70 60.30 60.70-61.25
EURO/USD 1.1200-1.1230 1.1280 1.1350-1.1420
GBP/USD 1.3510-1.3590 1.3630 1.3705-1.3750
USD/JPY 110.00-110.70 111.50 111.90-112.40

Intraday SUPPORTS LEVELS
13th December 2019 S1 S2 S3
GOLD-XAU 1,464-1,458 1,452 1,442-1,436
Silver-XAG 16.75-16.50 15.90 15.50-14.90
Crude Oil 59.00-58.65 57.80 57.20-56.00
EURO/USD 1.1150-1.1110 1.1060 1.0980-1.0930
GBP/USD 1.3400-1.3350 1.3300 1.3250-1.3200
USD/JPY 109.50-109.00 108.50 107.80-107.00

Intra-Day Strategy (13th 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 Thursday made its intraday high of US$1486.67/oz and low of US$1463.85/oz. Gold up 0.732% at US$1469.66/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 1464-1442 with risk below 1442, targeting 1478-1489 and 1500-1509. Sell below 1478-1509 keeping stop loss closing above 1510, targeting 1468-1458 and 1452-1442-1438.

 
Intraday Support Levels
S1     1,464-1,458
S2     1,452
S3     1,442-1,436
Intraday Resistance Levels
R1     1,478
R2     1,494
R3     1,500-1,509

Technical Indicators

Name   Value Action
14DRSI  

48.882

Buy
20-DMA   1465.95 Sell
50-DMA  

1448.19

Sell
100-DMA   1489.40 Sell
200-DMA   1409.31 Buy
STOCH(5,3)   46.621 Buy
MACD(12,26,9)   -2.241 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$17.10/oz and low of US$16.75/oz settled up by 0.344% at US$16.90/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 16.75-14.90 targeting 17.00-17.30-17.60 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     16.75-16.50
S2     15.90
S3     15.50-14.90

Intraday  Resistance Levels
R1     17.00-17.30
R2     17.60
R3     17.80-18.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.313 Buy
20-DMA   16.92 Sell
50-DMA   17.27 Sell
100-DMA   17.40 Sell
200-DMA   16.24 Buy
STOCH(5,3)   46.268 Buy
MACD(12,26,9)   -0.170 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$59.57/bbl, intraday low of US$58.60/bbl and settled up by 0.491% to close at US$59.04/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     59.00-58.65
S2     57.80
S3     57.20-56.00

Intraday Resistance Levels
R1     59.70
R2     60.30
R3     60.70-61.25

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.638 Sell
20-DMA   57.73 Sell
50-DMA   56.22 Buy
100-DMA   55.93 Buy
200-DMA   57.61 Sell
STOCH(5,3)   65.130 Sell
MACD(12,26,9)   0.307 Sell

EUR/USD

AAFX TRADING

EUR/USD of Thursday an intraday low of US$1.1102/EUR, high of US$1.1153/EUR and settled the day down by 0.006% to close at US$1.1128/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 1.1150-1.0900 with risk below 1.0900, targeting 1.1200-1.1230 and 1.1230-1.1280. Sell below 1.1200-1.1420 targeting 1.1110-1.1060-1.1030 and 1.0960-1.0860 with stop-loss at daily closing above 1.1300.

 
Intraday Support Levels
S1     1.1150-1.1110
S2     1.1060
S3     1.0980-1.0930

Intraday  Resistance Levels
R1     1.1200-1.1230
R2     1.1280
R3     1.1350-1.1420

TECHNICAL INDICATORS
Name   Value Action
14DRSI   66.357 Buy
20-DMA   1.1066 Sell
50-DMA   1.1068 Sell
100-DMA   1.1064 Sell
200-DMA   1.1153 Sell
STOCH(5,3)   80.958 Sell
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.3049/GBP, high of US$1.3228/GBP and settled the day down by 0.234% to close at US$1.3163/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     1.3400-1.3350
S2     1.3300
S3     1.3250-1.3200

Intraday Resistance Levels
R1     1.3510-1.3590
R2     1.3630
R3     1.3705-1.3750

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 Thursday made intra‐day low of JPY108.45/USD and made an intraday high of JPY109.44/USD and settled the day up by 0.684% at JPY109.29/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     109.50-109.00
S2     108.50
S3     107.80-107.00

INTRADAY RESISTANCE LEVELS
R1     110.00-110.70
R2     111.50
R3     111.90-112.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.367 Buy
20-DMA   108.90 Sell
50-DMA   108.68 Buy
100-DMA   107.83 Buy
200-DMA   108.42 Sell
STOCH(9,6)   78.253 Buy
MACD(12,26,9)   0.206 Buy

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