AAFX TRADING

Daily Market Lookup

  • The U.S. dollar steadied on Thursday in Asia following the release of firmer services and private labor market data. Overnight, ISM non-manufacturing data for January showed an uptick to 55.5, beating expectations of 55. On the labor market front, private payrolls grew by 291,000 last month, a sharp increase from the 199,000 in December, according to a report released Wednesday by ADP and Moody's Analytics. That beat the economists' forecast of 156,000. The U.S. employment report for January is set for release on Friday. Treasurer Josh Frydenberg echoed his comments and said the coronavirus outbreak will have a “significant” impact on Australia’s economy due to the nation’s deep ties with China, though it was too soon to quantify the expected hit.
  • The U.S. dollar stood tall on Thursday, supported by firm domestic data and hopes the coronavirus' economic impact could be limited, even as the human toll continued to climb. Another 73 people on the Chinese mainland died on Wednesday from the outbreak, the highest daily increase so far, bringing the total death toll to 563. Infections stand at 28,018. Drugmakers and the World Health Organization played down press reports about progress toward finding treatments, which had boosted traders' confidence. Amid the uncertainty about the virus, currency investors also turned their attention to traditional market drivers, specifically U.S. private payrolls, which posted their biggest jump in nearly four years, while a separate report showed a service sector pickup. Yet plenty of caution remains elsewhere, with oil prices stabilizing but making only a cautious recovery with the size of the expected hit to demand still growing. The virus has disrupted air travel, driven holiday cancellations, factory closures and production cuts.
  • Oil prices rose on Thursday in Asia amid reports on possible treatment for the coronavirus in China. China's Changjiang Daily newspaper reported that a team of researchers led by Zhejiang University Professor Li Lanjuan had found that drugs Abidol and Darunavir can be used to treat patients infected by the new coronavirus that has claimed more than 560 lives so far in China. Separately, a British scientist has made a significant breakthrough by reducing part of the normal development time from two to three years to only 14 days. Despite the news, the World Health Organization reiterated on Wednesday that there are no proven therapeutics. Oil prices were also supported today by prospects for OPEC+ output cuts. OPEC+ is set to meet for a fourth day on Thursday and discuss whether to reduce oil production further to support prices. Meanwhile, the Energy Information Administration (EIA) reported overnight that stockpiles of U.S. oil rose more than anticipated last week, Oil inventories rose by 3.35 million barrels for the week ended Jan. 31, the EIA said. Analysts were looking for a build of 2.8 million barrels. Oil rose for a second day on optimism OPEC+ will agree on deeper cuts in response to virus-led demand destruction, countering a further increase in U.S. crude stockpiles. While Saudi Arabia and Russia remain split over the threat the outbreak poses to global demand, talks between experts from OPEC and its allies have been extended into a third day as they seek to determine the impact on consumption. Speculation of a potential resolution helped to offset a larger-than-expected increase in American inventories. Oil is still down more than 18% since early January as the spread of the deadly virus curtails travel and fuel consumption, upending trade flows worldwide. BP (LON:BP) Plc expects the crisis to wipe out one-third of global oil demand growth in 2020. U.S. crude stockpiles expanded by 3.36 million barrels last week, according to the Energy Information Administration. Inventories rose for a second week to the highest level in more than a month.

 

 
Intraday RESISTANCE LEVELS
6th February 2020 R1 R2 R3
GOLD-XAU 1.564-1,571 1,580 1,590-1,600
Silver-XAG 17.90-18.25 18.50 18.70-19.10
Crude Oil 52.20 52.70-53.80 54.50
EURO/USD 1.1010-1.1050 1.1100 1.1190-1.1230
GBP/USD 1.3010-1.3060 1.3100 1.3160-1.3200
USD/JPY 110.00-110.30 110.70 111.20-111.50

Intraday SUPPORTS LEVELS
6th February 2020 S1 S2 S3
GOLD-XAU 1,548-1,542 1,536 1,530-1,520
Silver-XAG 17.40-17.10 16.60 16.25-15.90
Crude Oil 51.50-51.00 50.20 49.40-48.50
EURO/USD 1.0980-1.0930 1.0890 1.0810-1.0780
GBP/USD 1.2980 1.2930 1.2870-1.2840
USD/JPY 109.50-108.90 108.50 107.80-107.00

Intra-Day Strategy (6th February 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 Wednesday made its intraday high of US$1562.36/oz and low of US$1547.43/oz. Gold down 0.218% at US$1556.06/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 1548-1520 with risk below 1520, targeting 1564-1571-1578 and 1584-1590. Sell below 1564-1600 keeping stop loss closing above 1600, targeting 1548-1542-1536 and 1528-1520.

 
Intraday Support Levels
S1     1,548-1,542
S2     1,536
S3     1,530-1,520
Intraday Resistance Levels
R1     1.564-1,571
R2     1,580
R3     1,590-1,600

Technical Indicators

Name   Value Action
14DRSI  

51.678

Buy
20-DMA   1562.96 Buy
50-DMA  

1519.48

Buy
100-DMA   1504.48 Buy
200-DMA   1452.67 Buy
STOCH(5,3)   51.621 Buy
MACD(12,26,9)   10.161 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$17.71/oz and low of US$17.47/oz settled up by 0.142% at US$17.59/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 17.40-15.90 targeting 17.90-18.25-18.50 and 18.70-19.10; stop breakage below 16.00. Sell below 17.90-20.10 with stop loss above 20.10; targeting 17.50-17.00 and 16.25-16.00.

 
Intraday  Support Levels
S1     17.40-17.10
S2     16.60
S3     16.25-15.90

Intraday  Resistance Levels
R1     17.90-18.25
R2     18.50
R3     18.70-19.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   49.397 Buy
20-DMA   17.83 Sell
50-DMA   17.52 Buy
100-DMA   17.52 Buy
200-DMA   16.73 Buy
STOCH(5,3)   29.268 Sell
MACD(12,26,9)   0.0035 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US51.93bbl, intraday low of US$49.55/bbl and settled up by 3.49% to close at US$51.28/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 51.50-47.40 with risk daily closing below 47.50 and targeting 52.20-52.70 and 53.80-54.50-55.00. Sell in between 52.70-55.00 with stop loss at 55.00; targeting 51.50-51.00-50.20 and 49.40-48.00.

 
Intraday Support Levels
S1     51.50-51.00
S2     50.20
S3     49.40-48.50

Intraday Resistance Levels
R1     52.20
R2     52.70-53.80
R3     54.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   26.112 Sell
20-DMA   55.01 Sell
50-DMA   57.84 Sell
100-DMA   56.74 Sell
200-DMA   56.89 Sell
STOCH(5,3)   35.130 Buy
MACD(12,26,9)   -2.004 Sell

EUR/USD

AAFX TRADING

EUR/USD on Wednesday an intraday low of US$1.10993/EUR, high of US$1.1047/EUR and settled the day down by 0.413% to close at US$1.0998/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 1.0980-1.0780 with risk below 1.0780, targeting 1.10110-1.1050-1.1100 and 1.1180-1.1230-1.1280. Sell below 1.1010-1.1350 targeting 1.0980-1.0930-1.0890 and 1.0810-1.0780 with stop-loss at daily closing above 1.1350.

 
Intraday Support Levels
S1     1.0980-1.0930
S2     1.0890
S3     1.0810-1.0780

Intraday  Resistance Levels
R1     1.1010-1.1050
R2     1.1100
R3     1.1190-1.1230

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.673 Buy
20-DMA   1.1068 Sell
50-DMA   1.1093 Sell
100-DMA   1.1067 Sell
200-DMA   1.1125 Sell
STOCH(5,3)   20.758 Sell
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.2955/GBP, high of US$1.3069/GBP and settled the day down by 0.221% to close at US$1.2999/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 1.3010-1.3300 with targets at 1.3020-1.2930 and 1.2850-1.2800 stop-loss should be below 1.3420. Buy above 1.2980-1.2750 with targets 1.3010-1.3060 and 1.3100-1.3150-1.3200 with stop loss closing below 1.2750.

 
Intraday Support Levels
S1     1.2980
S2     1.2930
S3     1.2870-1.2840

Intraday Resistance Levels
R1     1.3010-1.3060
R2     1.3100
R3     1.3160-1.3200

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

45.909

Buy
20-DMA   1.3048 Sell
50-DMA   1.3071 Sell
100-DMA   1.2880 Buy
200-DMA   1.2692 Buy
STOCH(5,3)   23.940 Buy
MACD(12,26,9)   0.0027 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY109.29/USD and made an intraday high of JPY109.84/USD and settled the day up by 0.269% at JPY109.81/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 108.90-112.70 with risk above 112.70 targeting 108.50-107.80-107.00 and 106.50-106.00. Long positions above 108.50-106.00 with targets of 108.90-109.50-110.70 and 111.30-112.40-113.00 with stop below 107.00.

 
Intraday Support Levels
S1     109.50-108.90
S2     108.50
S3     107.80-107.00

INTRADAY RESISTANCE LEVELS
R1     110.00-110.30
R2     110.70
R3     111.20-111.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   38.402 Buy
20-DMA   109.52 Buy
50-DMA   109.23 Buy
100-DMA   108.77 Buy
200-DMA   108.40 Buy
STOCH(9,6)   97.253 Sell
MACD(12,26,9)   -0.126 Buy

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