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Daily Market Lookup

  • Asian shares jumped to an 18-month high on Friday while gold and oil prices stayed buoyant in a holiday-shortened week, as investor optimism was boosted by hopes a U.S.-China trade deal would soon be signed Traders returned from their Christmas and Boxing Day break to digest comments from Beijing that it was in close contact with Washington about an initial trade agreement, shortly after U.S. President Donald Trump talked up a signing ceremony for the recently struck Phase 1 trade deal. The country’s industrial output slipped for a second straight month in November in another sign the economy is cooling. Japan has approved a record budget for the coming fiscal year, in a bid to shore up growth. The rally in global share indices is in sharp contrast to a plunge late last year when fears about the impact of the Sino-U.S. trade war had sapped investor confidence. The worries scuttled capital expenditure plans over much of 2019, but strong employment and signs of an improving global economy suggest that will change next year. The U.S. Federal Reserve’s policy easing, economic data that has come in above low expectations, and corporate profits have helped lift stocks this year along with trade-related optimism. Market participants are now waiting for fourth-quarter earnings in January for indication on whether sentiment among corporates has actually improved. The dollar hovered near a six-month high versus the Japanese yen while the Australian dollar climbed to its strongest since July on Friday, buoyed by easing Sino-U.S. trade tensions.
  • The optimism around prospects for a trade deal reduced demand for safe-haven currencies such as the yen, but with global currency markets in a holiday mood after Christmas Day on Wednesday, overall trading activity was mostly subdued. Beijing said on Wednesday it is in close touch with Washington on a trade deal signing ceremony, a day after U.S. President Donald Trump said he and Chinese President Xi Jinping will have a ceremony to sign the recently struck agreement. Overnight, the dollar rose to as high as 109.68 yen against the safe-haven Japanese currency, a one-week high and not far from 109.73 yen, its late May peak brushed earlier this month. In Asian trade, the pair was last quoted at 109.47 yen. Profits at China's industrial firms in November grew at the fastest pace in eight months, breaking a three-month declining streak, as production and sales quickened, but broad weakness in domestic demand remains a risk for earnings next year. The U.S. dollar came off highs last week and the Chinese yuan strengthened on Friday morning in Asia. Optimism has helped shore up stock and currency markets over the past couple of weeks since China and the U.S. agreed to a phase one trade deal that could be signed in early January. U.S. President Donald Trump said on Thursday that there will be a signing and that the deal is “getting done”. On Friday, the USD/JPY pair was down 0.16% to 109.45. The yen gained some ground against the greenback even as the government released worse-than-expected retail sales data Friday morning. Retail sales fell 2.1% in November from a year earlier. The actual performance was worse than the 1.7% decline expected by the market, according to Reuters.
  • Oil prices reached three-month highs on Friday after record online shopping by U.S. consumers drove optimism for the world's biggest economy.   A report by Mastercard showed that online holiday spending by U.S. consumers reached a new high, exceeding analysts' forecasts and sending U.S. stocks surging. Oil prices have also been buoyed by hopes that the U.S.-China trade war will soon end. The issue that has cast a shadow on global economic growth prospects and created concerns over future demand for crude. The ripple effect of the trade row also made its way in data from Japan on Friday that showed that industrial output from the world's third-biggest economy shrank for a second month in November. Nonetheless, the Brent price has increased by more than a quarter in 2019, while the WTI is up around 35%. It has been boosted by the Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, curbing production. Earlier this month, OPEC and its allies agreed to extend and deepen those cuts. Oil prices rose on Friday, hitting three-month highs after data showed record online spending by U.S. consumers, stoking faith in the world's no. 1 economy even before the hoped-for end to the trade war between Washington and Beijing. A survey on Thursday showed that online holiday purchases by U.S. consumers reached a record, beating analysts' expectations and sending U.S. stocks to fresh. China on Wednesday said it was in close touch with the United States on a trade deal signing ceremony, after U.S. President Donald Trump said a day earlier that he and Chinese President Xi Jinping will hold a ceremony to sign the Phase 1 trade deal. The prospect of a sealed agreement propelled Wall Street to fresh highs, helping to support crude futures, which often follow equities.. Also supporting prices, the American Petroleum Institute, an oil industry group, said late on Tuesday that U.S. crude stocks fell by 7.9 million barrels last week, much more than forecast by analysts. Trading volume remained low due to the Christmas holiday, which has delayed the release of the U.S. government's official oil inventory report by two days until Friday. The so-called OPEC+ group agreed this month to extend and deepen production cuts that would take as much as 2.1 million barrels per day (bpd) of supply off the market from Jan. 1, or roughly 2% of global demand. Still, U.S. producers, not party to the OPEC+ agreement, have been pumping record amounts of oil, especially shale. Growth in U.S. production is forecast by many to slow in 2020. But more supply is coming in the new year from OPEC members Saudi Arabia and Kuwait, which this week agreed to end a dispute over their Neutral Zone, which can supply as much as 500,000 bpd.

 

 
Intraday RESISTANCE LEVELS
27th December 2019 R1 R2 R3
GOLD-XAU 1519 1,530 1,546-1557
Silver-XAG 18.00 18.40 18.70-19.00
Crude Oil 62.00-62.60 63.65-63.90 63.65-63.90
EURO/USD 1.1150-1.1200 1.1230 1.1280-1.1350
GBP/USD 1.3010-1.3060 1.3100 1.3200-1.3250
USD/JPY 110.00 110.70 111.50-111.90

Intraday SUPPORTS LEVELS
27th December 2019 S1 S2 S3
GOLD-XAU 1.508-1,500 1,494 1,486-1,478
Silver-XAG 17.55-17.00 16.55 16.10-15.80
Crude Oil 61.40-60.90 60.50 59.70-59.00
EURO/USD 1.1110-1.1060 1.0980 1.0930-1.0890
GBP/USD 1.2930-1.2850 1.2770 1.2690-1.2610
USD/JPY 109.50-109.00 108.50 107.80-107.00

Intra-Day Strategy (27th 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$1512.52/oz and low of US$1500.54/oz. Gold up 0.691% at US$1510.91/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 overbought territory and giving positive crossover to confirm bullish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1508-1468 with risk below 1468, targeting 1519-1530 and 1546-1557. Sell below 1519-1557 keeping stop loss closing above 1557, targeting 1509-1500-1489 and 1478-1468.

 
Intraday Support Levels
S1     1.508-1,500
S2     1,494
S3     1,486-1,478
Intraday Resistance Levels
R1     1519
R2     1,530
R3     1,546-1557

Technical Indicators

Name   Value Action
14DRSI  

72.047

Buy
20-DMA   1477.57 Buy
50-DMA  

1478.15

Buy
100-DMA   1492.47 Buy
200-DMA   1417.70 Buy
STOCH(5,3)   96.621 Buy
MACD(12,26,9)   7.185 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$18.03/oz and low of US$17.74/oz settled down by 0.401% at US$17.87/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 17.60-14.90 targeting 18.10-18.50 and 18.70-19.10; stop breakage below 14.90. Sell below 18.00-19.30 with stop loss above 19.30; targeting 17.60-17.00-16.25 and 16.00-15.70.

 
Intraday  Support Levels
S1     17.55-17.00
S2     16.55
S3     16.10-15.80

Intraday  Resistance Levels
R1     18.00
R2     18.40
R3     18.70-19.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   70.313 Buy
20-DMA   17.07 Buy
50-DMA   17.23 Sell
100-DMA   17.48 Sell
200-DMA   16.34 Buy
STOCH(5,3)   88.268 Buy
MACD(12,26,9)   -0.113 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US$61.71/bbl, intraday low of US$60.97/bbl and settled up by 0.308% to close at US$61.59/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 61.40-58.60 with risk daily closing below 58.60 and targeting 61.90-62.50 and 63.00-63.65-63.90. Sell below 61.90-63.90 with stop loss at 64.00; targeting 61.40-60.90-59.70 and 59.00-58.50.

 
Intraday Support Levels
S1     61.40-60.90
S2     60.50
S3     59.70-59.00

Intraday Resistance Levels
R1     62.00-62.60
R2     63.65-63.90
R3     63.65-63.90

TECHNICAL INDICATORS
Name   Value Action
14DRSI   68.369 Sell
20-DMA   59.25 Buy
50-DMA   57.58 Buy
100-DMA   56.44 Buy
200-DMA   57.72 Buy
STOCH(5,3)   90.130 Buy
MACD(12,26,9)   1.147 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday an intraday low of US$1.1081/EUR, high of US$1.1108/EUR and settled the day up by 0.055% to close at US$1.1096/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 1.1110-1.0890 with risk below 1.0890, targeting 1.1150-1.1200-1.1230 and 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     1.1110-1.1060
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   56.357 Buy
20-DMA   1.1097 Buy
50-DMA   1.1083 Buy
100-DMA   1.1060 Buy
200-DMA   1.1143 Sell
STOCH(5,3)   46.958 Sell
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2959/GBP, high of US$1.3015/GBP and settled the day up by 0.050% to close at US$1.2991/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 1.3010-1.3350 with targets at 1.2930-1.2850-1.2770 and 1.2690-1.2610 stop-loss should be below 1.3350. Buy above 1.2930-1.2610 with targets 1.3010-1.3060-1.3100 and 1.3200-1.3250 with stop loss closing below 1.2610.

 
Intraday Support Levels
S1     1.2930-1.2850
S2     1.2770
S3     1.2690-1.2610

Intraday Resistance Levels
R1     1.3010-1.3060
R2     1.3100
R3     1.3200-1.3250

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

48.018

Buy
20-DMA   1.3079 Sell
50-DMA   1.2962 Buy
100-DMA   1.2689 Buy
200-DMA   1.2689 Buy
STOCH(5,3)   19.191 Buy
MACD(12,26,9)   0.0012 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY109.34/USD and made an intraday high of JPY109.67/USD and settled the day up by 0.256% at JPY109.62/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   60.367 Buy
20-DMA   109.14 Sell
50-DMA   108.89 Buy
100-DMA   107.96 Buy
200-DMA   108.71 Sell
STOCH(9,6)   45.253 Buy
MACD(12,26,9)   0.184 Buy

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