AAFX TRADING

Daily Market Lookup

  • The U.S. dollar was largely unchanged on Thursday in Asia following the conclusion of much-awaited Sino-U.S. one trade deal. The U.S. and China completed the signing of the partial trade agreement at the White House overnight, putting the trade war between the two sides on a pause. U.S. Vice President Mike Pence said further phase two talks had already begun as negotiators work to resolve differences. Under the terms of the first deal, the U.S. reduced tariffs on $120 billion in Chinese goods to 7.5% from 15%. In exchange, China agreed to increase purchases in the U.S. by $200 billion over the next two years in manufactured goods, agriculture, energy and services. The U.S. Dollar Index that tracks the greenback against a basket of other currencies was largely unmoved following the news, as the deal was already largely priced into the markets. Earlier in the day, the index fell after data showed inflation in the U.S. remained muted. The Labor Department said its producer price index, which measures prices that businesses receive for their goods and services, slowed to a pace of 0.1%, below economists' forecasts for 0.2% rise. In the 12 months through November, the PPI rose 1.3%, in line with forecasts of 1.2%. Meanwhile, the GBP/USD pair inched up 0.1% to 1.3047, lifted by comments from Prime Minister Boris Johnson who said late Tuesday that he considers “very likely” the U.K. will get a “comprehensive trade deal with the EU by year-end.” In a speech earlier, Bank of England policymaker Michael Saunders repeated his support for a rate cut to support an economy weakened by Brexit and other uncertainties.
  • The dollar gave a little ground to riskier Asian currencies on Thursday, as investors hoped the Sino-U.S. trade deal could herald warmer relations between the world's two biggest economies and help to revive global growth. U.S. Vice President Mike Pence said further Phase 2 discussions had already begun as negotiators work to resolve differences. That helped the trade-exposed Australian and New Zealand dollars to book modest gains, while the safe-haven Japanese yen softened slightly. The Chinese yuan, the most sensitive currency to the U.S.-China trade relationship, headed back toward a six-month peak hit on Tuesday, adding 0.1% to 6.8860 per dollar in offshore trade . The centerpiece of the deal is a pledge by China to purchase at least an additional $200 billion worth of U.S. farm products and other goods and services over two years. The United States will also cut by half the tariff rate it imposed on Sept. 1 on a $120 billion list of Chinese goods, to 7.5%. Yet it addresses few of the issues that led to the trade conflict in the first place, checking potentially more dramatic market moves The agreement does not fully eliminate tariffs. It is vague on enforcement. It makes no real progress on host of thorny problems from intellectual and many analysts are skeptical that the purchase targets are realistic.
  • Oil prices recovered on Thursday in Asia after slumping to five-week lows earlier in the day after data showed petroleum stockpiles rose by 14 million barrels for a second week in a row. Oil prices initially slumped after the U.S. Energy Information Administration said crude inventories across the country fell by 2.55 million barrels for the week ended Jan. 10. Analysts were looking for drop of 474,000 barrels. Gasoline inventories jumped by about 6.7 million barrels, compared with expectations for a build of about 3.4 million barrels, the EIA said. Distillate stockpiles, meanwhile, soared by about 8.2 million barrels, versus expectations for a rise of about 1.2 million barrels, the agency said. It was the biggest weekly build in distillates since September 2017. Prices then recovered somewhat after the U.S. and China signed what they billed as the first phase of a broader trade pact. officials from the two nations announced that Beijing would purchase $200 billion of U.S. goods and services over the next year under the deal, including $50 billion for energy. China is the world’s largest buyer of oil and the United States is the largest producer of the commodity. Oil Prices Recover After Falling in Five-Week Lows on Inventory Data. Oil prices recovered on Thursday in Asia after slumping to five-week lows earlier in the day after data showed petroleum stockpiles rose by 14 million barrels for a second week in a row. Oil prices initially slumped after the U.S. Energy Information Administration said crude inventories across the country fell by 2.55 million barrels for the week ended Jan. 10. Analysts were looking for drop of 474,000 barrels. Gasoline inventories jumped by about 6.7 million barrels, compared with expectations for a build of about 3.4 million barrels, the EIA said. Distillate stockpiles, meanwhile, soared by about 8.2 million barrels, versus expectations for a rise of about 1.2 million barrels, the agency said. It was the biggest weekly build in distillates since September 2017. Prices then recovered somewhat after the U.S. and China signed what they billed as the first phase of a broader trade pact. officials from the two nations announced that Beijing would purchase $200 billion of U.S. goods and services over the next year under the deal, including $50 billion for energy. China is the world’s largest buyer of oil and the United States is the largest producer of the commodity.

 

 
Intraday RESISTANCE LEVELS
16th January 2020 R1 R2 R3
GOLD-XAU 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 110.00-110.70 111.20 112.00-112.40

Intraday SUPPORTS LEVELS
16th 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 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 109.50 109.00 108.50-107.80

Intra-Day Strategy (16th 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 Thursday made its intraday high of US$1558.06/oz and low of US$1545.82/oz. Gold up 0.633% at US$1556.02/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 1545-1511 with risk below 1511, targeting 1552-1557 and 1564-1571-1578. Sell below 1556-1578 keeping stop loss closing above 1580, targeting 1542-1536-1527 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
R2     1.564
R3     1,571-1,578

Technical Indicators

Name   Value Action
14DRSI  

65.442

Buy
20-DMA   1524.27 Buy
50-DMA  

1490.06

Buy
100-DMA   1496.98 Buy
200-DMA   1432.53 Buy
STOCH(5,3)   19.621 Sell
MACD(12,26,9)   20.161 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$18.02/oz and low of US$17.73/oz settled up by 1.255% at US$17.98/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   49.226 Buy
20-DMA   17.89 Buy
50-DMA   17.22 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 Tuesday made an intra‐day high of US58.37/bbl, intraday low of US$57.38/bbl and settled down by 0.189% to close at US$58.06/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 57.80-54.50 with risk daily closing below 56.90 and targeting 58.60-60.00 and 61.40-62.00-62.60. Sell in between 58.60-63.00 with stop loss at 63.00; targeting 57.80-56.90-56.00 and 55.20-54.50.

 
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 Tuesday an intraday low of US$1.1117/EUR, high of US$1.1162/EUR and settled the day up by 0.196% to close at US$1.1148/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 Wednesday made an intra‐day low of US$1.2984/GBP, high of US$1.3041/GBP and settled the day up by 0.150% to close at US$1.3036/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 Wednesday made intra‐day low of JPY109.87/USD and made an intraday high of JPY110.00/USD and settled the day down by 0.080% at JPY109.89/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
S2     109.00
S3     108.50-107.80

INTRADAY RESISTANCE LEVELS
R1     110.00-110.70
R2     111.20
R3     112.00-112.40

TECHNICAL INDICATORS
Name   Value Action
14DRSI   62.402 Buy
20-DMA   109.22 Buy
50-DMA   109.04 Buy
100-DMA   108.38 Buy
200-DMA   108.59 Buy
STOCH(9,6)   91.253 Sell
MACD(12,26,9)   0.1886 Buy

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