AAFX TRADING

Daily Market Lookup

  • Asian shares shook off a quiet start to reach new 19-month highs on Monday ahead of the expected signing of a Phase 1 China-U.S. trade deal, although markets have yet to see the details of the agreement. South Korea’s trade-sensitive Kospi added 1.01% and Hong Kong’s Hang Seng was up 0.95%, while Taiwan shares added 0.74% in the first trading day after Taiwan re-elected President Tsai Ing-wen by a landslide on Saturday. Mainland Chinese shares lagged the regional index after China’s major equity indexes logged their sixth consecutive weekly rise last week, the longest such streak since the first quarter of 2019. Investors in China are looking ahead to trade and economic growth data due this week, which is expected to shed more light on some early signs of economic improvement after the country, logged its slowest pace of growth in nearly three decades in the third quarter. Japan’s Nikkei was closed for a holiday. It fell sharply early last week when Iran attacked bases hosting U.S. military in Iraq, only to rally almost a thousand points when the two countries stepped back from hostilities. The main event of the week will be the signing of the Phase 1 trade deal between the United States and China on Wednesday. The Trump administration has invited at least 200 people to the White House for the ceremony. Washington has reserved the right to re‑impose tariffs if it judges China is not abiding by the deal. The dollar was firm on the yen at 109.62 but faces tough resistance around 109.70 where rallies have repeatedly failed in the past couple of months.
  • The U.S. dollar was flat on Monday in Asia ahead of the release of the latest inflation data. The potential signing of the phase one trade deal later this week is also in focus. The latest U.S. inflation figures, due on Tuesday, are expected to remain broadly in line with the 2% inflation target, while retail sales numbers from the holiday season will also be closely watched. A number of Federal Reserve officials will also speak this week. Boston Fed President Eric Rosengren and Atlanta Fed head Raphael Bostic will both discuss the economic outlook in appearances on Monday. Kansas City Fed President Esther George is due to deliver remarks on Tuesday, while Patrick Harker of the Philadelphia Fed and Robert Kaplan of the Dallas Fed are both due to make appearances on Wednesday. Figures on fourth-quarter growth, trade, industrial output, retail sales and inflation all due to be released this week. The data will be closely watched after Bank of England Governor Mark Carney last week promised a "relatively prompt response" if economic weakness persists. On the Brexit front, the U.K. is due to leave the EU on Jan. 31. It is uncertain whether 11 months will be enough to reach a deal. EU chief Ursula von der Leyen has earlier warned that a comprehensive U.K.-EU trade deal is “impossible” by the 2020 deadline. The U.S. dollar was flat on Friday as data showing the U.S. economy created fewer-than-expected jobs in December did little to suggest the Federal Reserve needs to move off the sidelines. The U.S. dollar index, which measures the green against a trade-weighted basket of six major currencies, fell by 0.07% to 97.09. The U.S. created 145,000 jobs last month, undershooting economists' forecast of 164,000. The unemployment rate remained unchanged at 3.5%, but wage growth slowed to a pace of 0.1% last month, missing expectations of 0.3%. Following the weaker-than-expected jobs report, BMO said there was little reason for the Fed to move from the sidelines as the trend of steady job growth, low joblessness and still-subdued wage inflation continued. Cable took a drubbing earlier this week and remains under pressure after Bank of England hinted at more monetary stimulus.
  • Oil prices slipped on Monday in Asia amid easing U.S.-Iran tensions its biggest weekly loss in more than six months as tensions between the U.S. and Iran eased. The threat of an outright war between the U.S. and Iran has receded since Tehran fired rockets at U.S.-Iraqi bases last week in retaliation for a U.S. airstrike that killed a top Iranian general. Last week, the U.S. House of Representatives voted to curb U.S. President Donald Trump’s power to strike Iran. Meanwhile, in comments to Fox News, Vice President Mike Pence said the Islamic Republic has asked militias in the Middle East not to carry out attacks against U.S. interests The situation in Iran remained volatile, however, as its citizens protested for a second night after the government admitted on Saturday that it had mistakenly show down a Ukrainian passenger jet, killing all 176 people on board. Iran’s government said Sunday it was forming a working group to probe the crash and compensate victims. On the Sino-U.S. trade front, Beijing and Washington will reportedly sign a phase one trade deal on Wednesday at the White House. There is no news of further trade talks, but Trump has earlier said that a phase two negotiations will soon start after the signing of the first deal.
  • Prices of the safe-haven gold slipped on Monday in Asia as Asian stocks traded higher ahead of the U.S.-China phase one trade deal signing. The yellow metal dropped as the U.S. is expected to sign the long awaited phase one trade deal with China this week. Under the terms of the accord, Beijing will increase imports from the U.S. in exchange for the suspension of the December tariffs on Chinese imports to the U.S. and a partial rollback of some existing tariffs. No deadline has been set for the phase two trade talks, although U.S. President Donald Trump has said earlier that negotiations will start soon after the signing of the phase one deal. The yellow metal got some support earlier in the day as bond prices firmed on weaker-than-expected December U.S. payroll growth. That pushed interest lower, making non-yielding gold more attractive. Situation in Iran also received some attention after its government admitted that they accidentally shot down a Ukrainian passenger jet. Iran’s admission came only after the U.S., U.K., Canada and Australia said they had intelligence indicating that the plane was struck by an Iranian missile, which Iran at first vehemently denied.

 

 
Intraday RESISTANCE LEVELS
13th January 2020 R1 R2 R3
GOLD-XAU 1,556-1.564 1,571 1,578-1,584
Silver-XAG 18.00-18.25 18.50 18.70-19.00
Crude Oil 60.00-60.80 61.40 62.00-62.60
EURO/USD 1.1180-1.1230 1.1280 1.1350-1.1400
GBP/USD 1.3060-1.3100 1.3150 1.3200-1.3250
USD/JPY 110.00-110.70 111.20 112.00-112.40

Intraday SUPPORTS LEVELS
13th January 2020 S1 S2 S3
GOLD-XAU 1,542-1,536 1.527 1,520-1,511
Silver-XAG 17.70-17.10 16.60 16.25-16.00
Crude Oil 59.00-58.60 57.80 56.90
EURO/USD 1.1100 1.1060 1.0980-1.0930
GBP/USD 1.3010 1.2930-1.2850 1.2800
USD/JPY 109.50-109.00 108.50 107.80-107.00

Intra-Day Strategy (13th January 2020)
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$1563.01/oz and low of US$1545.62/oz. Gold up 0.639% at US$1562.02/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 oversold 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 1540-1511 with risk below 1511, targeting 1557-1564-1571 and 1578-1584. Sell below 1550-1600 keeping stop loss closing above 1600, targeting 1536-1527 and 1519-1511.

 
Intraday Support Levels
S1     1,542-1,536
S2     1.527
S3     1,520-1,511
Intraday Resistance Levels
R1     1,556-1.564
R2     1,571
R3     1,578-1,584

Technical Indicators

Name   Value Action
14DRSI  

68.021

Buy
20-DMA   1517.31 Buy
50-DMA  

1488.72

Buy
100-DMA   1496.61 Buy
200-DMA   1429.99 Buy
STOCH(5,3)   26.621 Sell
MACD(12,26,9)   22.161 Sell

Silver - XAG

AAFX TRADING

Silver on Friday made its intraday high of US$18.13/oz and low of US$17.83/oz settled up by 1.347% at US$18.09/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 100DMA (17.55), breakage below will lead to 17.30. 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 oversold region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 17.60-16.00 targeting 18.00-18.50-18.70 and 19.10-19.65; stop breakage below 16.00. Sell below 18.00-20.10 with stop loss above 20.10; targeting 17.70-17.00 and 16.25-16.00.

 
Intraday  Support Levels
S1     17.70-17.10
S2     16.60
S3     16.25-16.00

Intraday  Resistance Levels
R1     18.00-18.25
R2     18.50
R3     18.70-19.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   57.226 Buy
20-DMA   17.54 Buy
50-DMA   17.28 Buy
100-DMA   17.55 Buy
200-DMA   16.45 Buy
STOCH(5,3)   12.268 Sell
MACD(12,26,9)   0.274 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US59.65/bbl, intraday low of US$58.76/bbl and settled down by 0.756% to close at US$59.04/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 200DMA i.e. 57.76 which is a resistance level and breakage above will call for 58.60. MACD is above zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in oversold region and giving negative crossover for confirmation of bearish 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 59.00-56.90 with risk daily closing below 56.90 and targeting 60.50-61.40-62.00 and 62.60-63.00. Sell in between 60.00-63.00 with stop loss at 63.00; targeting 59.00-58.00 and 57.80-56.90.

 
Intraday Support Levels
S1     59.00-58.60
S2     57.80
S3     56.90

Intraday Resistance Levels
R1     60.00-60.80
R2     61.40
R3     62.00-62.60

TECHNICAL INDICATORS
Name   Value Action
14DRSI   45.971 Sell
20-DMA   60.78 Sell
50-DMA   58.57 Buy
100-DMA   56.97 Buy
200-DMA   57.76 Buy
STOCH(5,3)   12.130 Sell
MACD(12,26,9)   0.778 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday an intraday low of US$1.1084/EUR, high of US$1.1128/EUR and settled the day up by 0.137% to close at US$1.1119/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 1.1100-1.0890 with risk below 1.0890, targeting 1.1180-1.1230-1.1280 and 1.1350-1.1400. Sell below 1.1180-1.1350 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     1.1100
S2     1.1060
S3     1.0980-1.0930

Intraday  Resistance Levels
R1     1.1180-1.1230
R2     1.1280
R3     1.1350-1.1400

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.742 Buy
20-DMA   1.1135 Buy
50-DMA   1.1090 Buy
100-DMA   1.1063 Buy
200-DMA   1.1139 Buy
STOCH(5,3)   9.958 Sell
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.3041/GBP, high of US$1.3096/GBP and settled the day down by 0.051% to close at US$1.3058/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 1.3060-1.3420 with targets at 1.3020-1.2930 and 1.2850-1.2800 stop-loss should be below 1.3420. Buy above 1.3010-1.2750 with targets 1.3060-1.3100-1.3150 and 1.3200-1.3250-1.3320 with stop loss closing below 1.2750.

 
Intraday Support Levels
S1     1.3010
S2     1.2930-1.2850
S3     1.2800

Intraday Resistance Levels
R1     1.3060-1.3100
R2     1.3150
R3     1.3200-1.3250

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

47.909

Buy
20-DMA   1.3097 Sell
50-DMA   1.3009 Buy
100-DMA   1.2742 Buy
200-DMA   1.2688 Buy
STOCH(5,3)   19.940 Sell
MACD(12,26,9)   0.0027 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY109.42/USD and made an intraday high of JPY109.68/USD and settled the day down by 0.042% at JPY109.46/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 110.00-112.70 with risk above 112.70 targeting 109.50-109.00-108.50 and 107.80-107.00-106.50. Long positions above 109.50-107.00 with targets of 109.50-110.00 and 110.70-111.30-112.40 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     111.20
R3     112.00-112.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.402 Buy
20-DMA   109.14 Sell
50-DMA   108.94 Buy
100-DMA   108.26 Buy
200-DMA   108.61 Sell
STOCH(9,6)   95.253 Buy
MACD(12,26,9)   0.0239 Buy

AAFX TRADING
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