AAFX TRADING

Daily Market Lookup

  • Asian markets idled near 18-month highs on Monday as trading volumes weakened ahead of the Christmas holiday break, with investors taking profit on gains made earlier this month. Global stocks were “basking in the afterglow of the U.S. China trade deal and continued encouraging signs of stabilization in the global growth slowdown,” said David Bassanese, Sydney-based chief economist at Betashares. n Friday, the benchmark S&P 500 extended its run of record highs to seven straight sessions, its longest streak in more than two years. All three major U.S. indexes - the S&P 500, Nasdaq and Dow - notched up gains. Data on Friday showed U.S. growth nudged up in the third quarter, while there were signs the economy maintained its moderate pace of expansion as the year ended. Consumer spending was stronger than previously reported, and there were upgrades to business spending. U.S. President Donald Trump gave markets more reasons to cheer on Saturday when he said the United States and China would “very shortly” sign their so-called Phase 1 trade pact. Under the deal, the United States would agree to reduce some tariffs in exchange for a big jump in Chinese purchases of American farm products. Further, China said on Monday it would lower tariffs on products ranging from frozen pork and avocado to some types of semiconductors next year as it looks to boost imports amid a slowing economy and a trade war with the United States. The only major data this week is the U.S. personal consumption expenditure (PCE) deflator for November, due on Friday.
  • The U.S. dollar started a short week in Asia flat amid indications that China and the U.S. continue to make progress in trade talks. On Friday, U.S. President Donald Trump said he had a “very good talk” with Chinese President Xi Jinping about the phase one trade deal reached this month and added that China has started to make large purchases of U.S. agricultural products. On Monday, China’s Ministry of Finance said the country would lower or remove import tariffs on 850 products from Jan. 1, including pork, frozen avocado and some technology products. The dollar held firm at the start of a holiday-thinned week on Monday, as U.S. data pointed to solid economic growth while the British pound bounced slightly after having suffered its biggest weekly fall in three years. A batch of economic data published on Friday showed the U.S. economy, already in its longest expansion in history, appears to have maintained the moderate pace of growth as the year ended, supported by a strong labor market. Gross domestic product increased at a 2.1% annualized rate, the Commerce Department said in its third estimate of third-quarter GDP. That was unrevised from November's estimate. Earlier this year, investors were spooked by fears over the possibility of a U.S. recession when the U.S. yield curve inverted, which has been historically one of the most reliable signs of a U.S. downturn. Separate data showed consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 0.4% last month as households stepped up purchases of motor vehicles and spent more on healthcare. That contrasted with an unexpected deterioration in German consumer sentiment. The dollar has been supported by optimism over the global economy since Washington and Beijing came to an interim trade agreement earlier this month. China said on Monday it would lower tariffs on products ranging from frozen pork to some type of semiconductors next year, as Beijing looks to boost imports amid a slowing economy and a trade war with the United States U.S. President Donald Trump said on Saturday the United States and China would "very shortly" sign their so-called Phase 1 trade pact. Against the yen, the dollar changed hands at 109.41 yen , little changed on the day and not far from a six-month high of 109.73 touched earlier this month. The dollar tumbled as much as 4.4% on the second trading day of this year as a lack of yen liquidity, due to a Japanese market holiday, amplified the dollar/yen's fall sparked by a rare revenue warning from Apple Inc Currency speculators have cut their net short positions in the yen slightly in the week that ended last Tuesday after having increased bets against the currency constantly for a few months, data from the U.S. financial watchdog showed on Friday.
  • Oil prices held steady after three weeks of gains as optimism around the US-China trade war ending grows. President Donald Trump recently said that an agreement would be signed "very shortly", feeding market optimism. A phase one deal was announced earlier in December as an attempt to end the trade war between the world's two largest economies and oil consumers. The trade battle has impacted markets and global growth throughout its duration. The U.S. is said to be reducing some tariffs in exchange for a big increase in purchases by Chinese importers of American agricultural products. The deal is due to be signed in January. Business confidence and the outlook for economic growth and energy demand has rebounded as a result. U.S. drillers are likely anticipating higher prices as well, as they increased the number of their oil rigs last week. It is the most in a week since February 2018. Eighteen oil rigs were added in the week to Dec. 20, bringing the total to 685, the most since November, stated energy services company Baker Hughes in its weekly report. The latest data shows that U.S. economic growth has nudged up in the third quarter. The economy looks to have maintained a moderate pace of expansion as the year ends, supported by a strong labor market. U.S. drillers may be anticipating higher prices as well and last week increased the number of their oil rigs by the most in a week since February 2018. Drillers added 18 oil rigs in the week to Dec. 20, bringing the total to 685, the most since November, Baker Hughes, an energy services company, said in its weekly report. U.S. economic growth nudged up in the third quarter, latest data shows, and the economy appears to have maintained the moderate pace of expansion as the year ended, supported by a strong labor market. Many investors are on holiday already with the end of the year around the corner and trading is thin, potentially accentuating market moves due to the lack of liquidity.

 

 
Intraday RESISTANCE LEVELS
23rd December 2019 R1 R2 R3
GOLD-XAU 1,486-1,494 1,500 1.509-1520
Silver-XAG 17.45 17.80-18.10 18.50
Crude Oil 60.30-60.90 61.40 62.00-62.60
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 109.50-110.00 110.70 111.50-111.90

Intraday SUPPORTS LEVELS
23rd December 2019 S1 S2 S3
GOLD-XAU 1,478-1,468 1,458 1,452-1,442
Silver-XAG 17.00-16.50 15.90 15.50-14.90
Crude Oil 59.70 59.00-58.65 58.00
EURO/USD 1.1080-1.1060 1.0980 1.0930-1.0890
GBP/USD 1.3010 1.2930 1.2850-1.2770
USD/JPY 109.00 108.50 107.80-107.00

Intra-Day Strategy (23rd 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$1480.91/oz and low of US$1475.76/oz. Gold up 0.239% at US$1477.97/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 1478-1442 with risk below 1442, targeting 1489-1500 and 1509-1520. Sell below 1486-1520 keeping stop loss closing above 1520, targeting 1478-1468-1458 and 1452-1442.

 
Intraday Support Levels
S1     1,478-1,468
S2     1,458
S3     1,452-1,442
Intraday Resistance Levels
R1     1,486-1,494
R2     1,500
R3     1.509-1520

Technical Indicators

Name   Value Action
14DRSI  

58.882

Buy
20-DMA   1469.90 Sell
50-DMA  

1476.91

Sell
100-DMA   1491.07 Sell
200-DMA   84.621 Buy
STOCH(5,3)   84.621 Buy
MACD(12,26,9)   1.550 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$17.24/oz and low of US$17.01/oz settled up by 0.897% at US$17.19/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 17.00-14.90 targeting 17.45-17.80 and 18.10-18.50; stop breakage below 14.90. Sell below 17.45-19.30 with stop loss above 19.30; targeting 17.00-16.25-16.00 and 15.70-14.90.

 
Intraday  Support Levels
S1     17.00-16.50
S2     15.90
S3     15.50-14.90

Intraday  Resistance Levels
R1     17.45
R2     17.80-18.10
R3     18.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.313 Buy
20-DMA   16.90 Buy
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 Friday made an intra‐day high of US$61.11/bbl, intraday low of US$59.98/bbl and settled down by 1.212% to close at US$60.27/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 59.70-56.10 with risk daily closing below 56.10 and targeting 61.45-61.90 and 62.50-63.10. Sell below 60.30-63.10 with stop loss at 63.20; targeting 59.70-59.00 and 58.50-58.00.

 
Intraday Support Levels
S1     59.70
S2     59.00-58.65
S3     58.00

Intraday Resistance Levels
R1     60.30-60.90
R2     61.40
R3     62.00-62.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.538 Sell
20-DMA   58.73 Buy
50-DMA   57.08 Buy
100-DMA   56.18 Buy
200-DMA   57.69 Sell
STOCH(5,3)   49.130 Sell
MACD(12,26,9)   0.995 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday an intraday low of US$1.1065/EUR, high of US$1.1143/EUR and settled the day down by 0.360% to close at US$1.1080/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 1.1080-1.0890 with risk below 1.0890, targeting 1.1150-1.1200-1.1230 and 1.1230-1.1280-1.1350. Sell below 1.1150-1.1350 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     1.1080-1.1060
S2     1.0980
S3     1.0930-1.0890

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   1.1083 Buy
50-DMA   1.1081 Buy
100-DMA   1.1062 Buy
200-DMA   1.1147 Sell
STOCH(5,3)   16.958 Sell
MACD(12,26,9)   -0.005 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2977/GBP, high of US$1.3078/GBP and settled the day down by 0.099% to close at US$1.2994/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 Friday made intra‐day low of JPY109.24/USD and made an intraday high of JPY109.51/USD and settled the day up by 0.0630% at JPY109.42/USD.

Technicals in Focus:

USD/JPY on Friday made intra‐day low of JPY109.24/USD and made an intraday high of JPY109.51/USD and settled the day up by 0.0630% at JPY109.42/USD.

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     109.00
S2     108.50
S3     107.80-107.00

INTRADAY RESISTANCE LEVELS
R1     109.50-110.00
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

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