AAFX TRADING

Daily Market Lookup

  • Asian shares snoozed near 18-month highs on Friday as trade thinned in the run-up to Christmas and investors seemed content to digest the chunky gains already made so far this month. Sentiment had been bolstered after U.S. Treasury Secretary Steven Mnuchin said the United States and China would sign their Phase One trade pact in early January. Mnuchin said it was completely finished and just undergoing a technical “scrub,” though Beijing has so far dodged all details of the deal. The U.S. House of Representatives also overwhelmingly approved a new North American deal that leaves $1.2 trillion in annual U.S.-Mexico-Canada trade flows largely intact The market shrugged off U.S. President Donald Trump’s impeachment, as the Republican-controlled Senate is widely expected to keep him in office. It was mostly quiet in currencies, though sterling was nursing a grudge after suffering a vicious reversal that left it facing its worst weekly fall since late 2017 at 2.4% Early Friday, the pound was huddled at $1.3017 GBP=D3 having toppled from a $1.3514 peak when Prime Minister Boris Johnson used his sweeping election victory to revive the risk of a hard Brexit.
  • With the release of a series of data, the U.S. dollar gained some ground on Friday in Asia after declining for two weeks. The greenback has made a slight comeback after drifting further on Thursday on the news of U.S. President Donald Trump’s impeachment by the House of Representatives. Trump is the third president to be impeached in U.S. history but is likely to survive a trial in the GOP-led Senate, which is expected to vote in January. The National Association of Realtors reported that the existing-home sales had decreased 1.7% from October to an annual rate of 5.35 million in November. However, sales are up by 2.7% year on year compared to the 5.21 million in November 2018. In addition, new job data pointed to sustained labour market strength with initial claims for state unemployment benefits fell 18,000 to 234,000 for the week ended Dec. 14, said the Labour Department. The reading surged to a two-year high at 25,200 last week. Meanwhile, the Philadelphia Federal Reserve released a flat manufacturing index for December on Thursday. The current general activity index fell 10.1 points to 0.3 in December – this is its weakest reading in six months and far below economists’ expectations of 8, according to a Reuters survey. The index tracks manufacturing in Pennsylvania, New Jersey and Delaware. The U.S. dollar slipped on Thursday in Asia after U.S. House of Representatives voted to impeach Republican U.S. President Donald Trump for abuse of power and obstruction of Congress. Trump is the third president to be impeached in U.S. history but is likely to survive a trial in the GOP-led Senate, which is expected to vote in January. On the data front, the National Association of Realtors will report on existing home sales for November tomorrow. Sales of existing homes are expected to have dropped 0.2% last month to an annual rate of 5.44 million, according to forecasts compiled by Investing.com. Initial jobless claims is also due. Economists are looking for a drop in claims for first-time unemployment benefits to 225,000. Meanwhile, the Philadelphia Federal Reserve will release its manufacturing index for December on the same day. Economists expect the Philly Fed Index to come in at 8 for the month from 10.4 in November. The index tracks manufacturing in Pennsylvania, New Jersey and Delaware. The USD/JPY pair gained 0.1% to 109.57 after the Bank of Japan kept its policy unchanged on Thursday morning. The central bank maintained its forward guidance, saying it expected rates to remain low or lower as long as there was a chance of losing price momentum. The decision was largely in line with expectation. The Australian dollar climbed 0.3% against the U.S. dollar to reach 0.6875 after data showed the country’s unemployment unexpectedly in November declined. Employment jumped 39,900 last month, compared with economists’ estimates of a 15,000 gain, data from the Australian Bureau of Statistics showed Thursday.
  • Oil prices stayed close to three-month highs on Friday as the China-U.S. trade talks showed signs of progress. Both are still on track for a third consecutive weekly rise. The trade dispute between the United States and China, both the world's two biggest oil consumers, have affected demand previously. But recent developments have raised expectations that there will be stronger demand to come. On Thursday, China announced import tariff exemptions for six oil and chemical products from the U.S., just a few days after both sides reached an interim trade deal. The exemption will be in force for 12 months, ending on December 26, 2020. Deeper output cuts by major producers are also said to provide tailwind for the market. Both JP Morgan and Goldman Sachs raised their 2020 oil price outlook earlier this week as The Organization of Petroleum Exporting Countries (OPEC)-led output cuts and an improved global trade outlook led to more optimism. OPEC and its allies including Russia agreed earlier in December to make a further cut of 500,000 barrels per day (bpd) from Jan. 1 on top of previous reductions of 1.2 million bpd. A drop in U.S. crude inventories also helped oil prices to stay near three-month highs. According to the Energy Information Administration (EIA), U.S. crude oil stockpiles fell by 1.1 million barrels to 446.8 million barrels in the week to Dec. 13. A U.S. weekly drilling report by energy services firm Baker Hughes Co (N:BKR) is due to be released on Friday. U.S. drilling firms added 4 oil rigs in the week to Dec. 13, bringing the total count to 667.

 

 
Intraday RESISTANCE LEVELS
20th December 2019 R1 R2 R3
GOLD-XAU 1,478-1,486 1,494 1,500-1.509
Silver-XAG 17.30 17.60 17.80-18.10
Crude Oil 61.40 62.00 62.60-63.10
EURO/USD 1.1150-1.1200 1.1230 1.1280-1.1350
GBP/USD 1.3060-1.3100 1.3200 1.3250-1.3300
USD/JPY 110.00 110.70 111.50-111.90

Intraday SUPPORTS LEVELS
20th December 2019 S1 S2 S3
GOLD-XAU 1,468-1,458 1,452 1,442-1,436
Silver-XAG 16.90-16.50 15.90 15.50-14.90
Crude Oil 60.90-60.30 59.70 59.00-58.65
EURO/USD 1.1110 1.1060 1.0980-1.0930
GBP/USD 1.3010 1.2930 1.2850-1.2770
USD/JPY 109.50-109.00 108.50 107.80-107.00

Intra-Day Strategy (20th 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$1481.62/oz and low of US$1473.22/oz. Gold up 0.239% at US$1478.77/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 1468-1442 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     1,468-1,458
S2     1,452
S3     1,442-1,436
Intraday Resistance Levels
R1     1,478-1,486
R2     1,494
R3     1,500-1.509

Technical Indicators

Name   Value Action
14DRSI  

53.882

Buy
20-DMA   1467.00 Sell
50-DMA  

1477.63

Sell
100-DMA   1491.07 Sell
200-DMA   1412.03 Buy
STOCH(5,3)   58.621 Buy
MACD(12,26,9)   -0.073 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$17.11/oz and low of US$16.88/oz settled up by 0.359% at US$17.04/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 16.90-14.90 targeting 17.30-17.60 and 17.80-18.50; stop breakage below 14.90. Sell below 17.30-19.30 with stop loss above 19.00; targeting 16.90-16.25-16.00 and 15.70-14.90.

 
Intraday  Support Levels
S1     16.90-16.50
S2     15.90
S3     15.50-14.90

Intraday  Resistance Levels
R1     17.30
R2     17.60
R3     17.80-18.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.313 Buy
20-DMA   16.90 Sell
50-DMA   17.22 Sell
100-DMA   17.42 Sell
200-DMA   16.28 Buy
STOCH(5,3)   78.268 Buy
MACD(12,26,9)   -0.113 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US$61.32/bbl, intraday low of US$60.60/bbl and settled up by 0.395% to close at US$60.96/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 60.90-56.10 with risk daily closing below 56.10 and targeting 61.45-61.90 and 62.50-63.10. Sell below 61.40-63.10 with stop loss at 63.20; targeting 60.90-60.30-59.70 and 59.00-58.50.

 
Intraday Support Levels
S1     60.90-60.30
S2     59.70
S3     59.00-58.65

Intraday Resistance Levels
R1     61.40
R2     62.00
R3     62.60-63.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   67.538 Sell
20-DMA   58.65 Buy
50-DMA   56.96 Buy
100-DMA   56.13 Buy
200-DMA   57.69 Sell
STOCH(5,3)   82.130 Buy
MACD(12,26,9)   1.0279 Sell

EUR/USD

AAFX TRADING

EUR/USD of Thursday an intraday low of US$1.1106/EUR, high of US$1.1143/EUR and settled the day up by 0.0764% to close at US$1.1120/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 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 1.1110-1.0900 with risk below 1.0900, targeting 1.1150-1.1200-1.1230 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     1.1110
S2     1.1060
S3     1.0980-1.0930

Intraday  Resistance Levels
R1     1.1150-1.1200
R2     1.1230
R3     1.1280-1.1350

TECHNICAL INDICATORS
Name   Value Action
14DRSI   55.357 Buy
20-DMA   1.1081 Buy
50-DMA   1.1081 Buy
100-DMA   1.1064 Buy
200-DMA   1.1148 Sell
STOCH(5,3)   15.958 Sell
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2989/GBP, high of US$1.3132/GBP and settled the day down by 0.535% to close at US$1.3007/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 1.3100-1.3350 with targets at 1.3060-1.3010-1.2930 and 1.2850-1.2770 stop-loss should be below 1.3705. Buy above 1.3060-1.3200 with targets 1.3400-1.3510-1.3590 and 1.3630-1.3705 with stop loss closing below 1.3100.

 
Intraday Support Levels
S1     1.3010
S2     1.2930
S3     1.2850-1.2770

Intraday Resistance Levels
R1     1.3060-1.3100
R2     1.3200
R3     1.3250-1.3300

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

48.940

Buy
20-DMA   1.3070 Buy
50-DMA   1.2949 Buy
100-DMA   1.2609 Buy
200-DMA   1.2693 Buy
STOCH(5,3)   5.191 Sell
MACD(12,26,9)   0.0012 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY109.17/USD and made an intraday high of JPY109.67/USD and settled the day down by 0.159% at JPY109.35/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 109.00-108.50-107.80 and 107.00-106.50. Long positions above 109.10-107.00 with targets of 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
R2     110.70
R3     111.50-111.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   61.367 Buy
20-DMA   109.07 Sell
50-DMA   108.84 Buy
100-DMA   107.87 Buy
200-DMA   108.74 Sell
STOCH(9,6)   84.253 Buy
MACD(12,26,9)   0.206 Buy

AAFX TRADING
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