AAFX TRADING

Daily Market Lookup

  • The yuan rose while the safe-haven yen fell on Tuesday in Asia as trade tensions between the U.S. and China eased. Just two days before the signing of the phase one trade deal, the Trump administration announced that it was removing China from its designation as a currency manipulator. However, China remained on a monitoring list for foreign-exchange practices. The administration praised China for making “enforceable commitments” not to devalue the yuan. The Chinese currency has now recouped about a third of the losses it sustained against the dollar since mid-June 2018. Chinese Vice Premier Liu He is expected to seal the partial trade deal with the U.S. in Washington on Wednesday. On the data front, China’s exports and imports both rose in 2019, according to the General Administration of Customs In yuan terms, 2019 exports rose 5% from a year ago while imports 1.6% in the same period. Meanwhile, the safe-haven yen dropped against the U.S. dollar as investor sentiment improved following the trade news. The yen weakened past 100 per U.S. dollar for the first time in almost months earlier in the day. Easing U.S.-Iran tensions were also cited as a headwind for the Japanese currency. The pound pared some of its losses Monday against the dollar after falling to a two-and-a-half-week lows as softer U.K. economic data strengthened expectations for a Bank of England rate cut. But an analyst said traders should "buy the dip."
  • GBP/USD fell 0.50% to $1.2994, but had been as low as $1.2961 after data showed unexpected weakness in U.K. industrial production and GDP data in November. The data followed remarks by Bank of England monetary policy member Gertjan Vlieghe Vlieghe, who said he stood ready to back a rate cut if economic growth failed to improve. But BMO analyst Stephen Gallo suggested investors "buy the dip" as concerns about weak U.K. economic data are overdone. The weaker U.K. economic data are already "old news" and a potential rate cut could see an "even larger" rebound in sterling on any increased fiscal spending, Gallo said. EUR/USD rose 0.19% to $1.1141, with some touting further gains for the single currency on expectations for a hawkish pivot from the European Central Bank. The bounce from lows in cable and the slight uptick in the euro, kept the dollar roughly flat. Downside in the greenback, however, was limited by an ongoing decline in the yen on falling demand for safe havens as sentiment on U.S.-China relations continued to improve ahead of the conclusion of their phase one trade deal later this week. The White House plans to lift its designation of China as a currency manipulator, Bloomberg reported, citing people familiar with the matter.
  • 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.
  • Gold prices were down on Tuesday in Asia as the imminent signing of the U.S.-China phase one deal sent global equities higher and sapped safe-haven demand. The yellow metal hit April 2013 highs last week after Iran launched rockets at U.S. airbases in Iraq in response to an airstrike that killed a top Iranian general earlier this month. Sino-U.S. trade optimism were cited as a headwind for the safe-haven metal today. Global equities traded higher today as China and the U.S. prepared to sign a truce in their 18-month-long tariff dispute. U.S. Trade Representative Robert Lighthizer said that the Chinese translation of the deal was almost completed and would be made public on Wednesday, while Treasury Secretary Steven Mnuchin told Fox News on the weekend that Beijing had promised to buy $40 billion to $50 billion worth of U.S. farm products annually and a total of $200 billion of U.S. goods over the next two years. Meanwhile, just two days before the signing of the deal, the U.S. dropped China's designation as a currency manipulator, further easing the tensions between the two nations. On the data front, China reported that its exports rose for the first time in five months in December, while imports also surpassed expectations.

 

 
Intraday RESISTANCE LEVELS
14th January 2020 R1 R2 R3
GOLD-XAU 1,542-1,556 1.564 1,571-1,578
Silver-XAG 18.00-18.25 18.50 18.70-19.00
Crude Oil 58.60-59.00 60.00 60.80-61.40
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 110.70 111.20 112.00-112.40

Intraday SUPPORTS LEVELS
14th January 2020 S1 S2 S3
GOLD-XAU 1,536 1.527 1,520-1,511
Silver-XAG 17.70-17.10 16.60 16.25-16.00
Crude Oil 57.80-56.90 56.00 55.20-54.50
EURO/USD 1.1100 1.1060 1.0980-1.0930
GBP/USD 1.2980 1.2930-1.2850 1.2800
USD/JPY 110.00-109.50 109.00 108.50-107.80

Intra-Day Strategy (14th 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 Monday made its intraday high of US$1561.74/oz and low of US$1546.44/oz. Gold down 0.898% at US$1547.71/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 1536-1511 with risk below 1511, targeting 1542-1551-1557 and 1564-1571-1578. Sell below 1544-1578 keeping stop loss closing above 1580, targeting 1536-1527 and 1519-1511.

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

Technical Indicators

Name   Value Action
14DRSI  

59.442

Buy
20-DMA   1520.14 Buy
50-DMA  

1489.08

Buy
100-DMA   1496.66 Buy
200-DMA   1431.19 Buy
STOCH(5,3)   15.621 Sell
MACD(12,26,9)   20.161 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$18.08/oz and low of US$17.90/oz settled down by 0.686% at US$17.94/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   53.226 Buy
20-DMA   17.70 Buy
50-DMA   17.28 Buy
100-DMA   17.58 Buy
200-DMA   16.49 Buy
STOCH(5,3)   15.268 Sell
MACD(12,26,9)   0.274 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US59.18/bbl, intraday low of US$57.90/bbl and settled down by 1.292% to close at US$58.03/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     57.80-56.90
S2     56.00
S3     55.20-54.50

Intraday Resistance Levels
R1     58.60-59.00
R2     60.00
R3     60.80-61.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.971 Sell
20-DMA   60.65 Sell
50-DMA   58.77 Sell
100-DMA   57.03 Buy
200-DMA   57.72 Buy
STOCH(5,3)   3.130 Sell
MACD(12,26,9)   0.101 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.1111/EUR, high of US$1.1146/EUR and settled the day up by 0.156% to close at US$1.1133/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   52.085 Buy
20-DMA   1.1137 Buy
50-DMA   1.1089 Buy
100-DMA   1.1063 Buy
200-DMA   1.1138 Buy
STOCH(5,3)   42.958 Buy
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.2960/GBP, high of US$1.3044/GBP and settled the day down by 0.351% to close at US$1.2987/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     1.2980
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  

45.909

Buy
20-DMA   1.3078 Sell
50-DMA   1.3009 Sell
100-DMA   1.2749 Buy
200-DMA   1.2688 Buy
STOCH(5,3)   15.940 Sell
MACD(12,26,9)   0.0027 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY109.49/USD and made an intraday high of JPY109.49/USD and settled the day up by 0.376% at JPY109.93/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     110.00-109.50
S2     109.00
S3     108.50-107.80

INTRADAY RESISTANCE LEVELS
R1     110.70
R2     111.20
R3     112.00-112.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   78.402 Buy
20-DMA   109.66 Sell
50-DMA   108.91 Buy
100-DMA   109.09 Buy
200-DMA   109.09 Sell
STOCH(9,6)   95.253 Buy
MACD(12,26,9)   0.0239 Buy

AAFX TRADING
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