AAFX TRADING

Daily Market Lookup

  • Asian shares fell and Wall Street retreated from record highs on Tuesday after Apple Inc (AAPL.O) said it will not meet its revenue guidance for the March quarter as the coronavirus outbreak slowed production and weakened demand in China. The warning from the most valuable company in the United States sobered investor optimism that economic stimulus by Beijing and other countries would protect the global economy from the effects of the epidemic. China’s central bank cut the interest rate on its medium-term lending on Monday, which is expected to pave the way for a reduction in the benchmark loan prime rate on Thursday. But sentiment was shaken when Apple told investors its manufacturing facilities in China have begun to re-open but are ramping up more slowly than expected, reinforcing signs of a broader hit to businesses from the epidemic. As China’s authorities try to prevent the spread of the disease, the economy is paying a heavy price. Some cities remained in lockdown, streets are deserted, and travel bans and quarantine orders are in place around the country, preventing migrant workers from getting back to their jobs. Many factories have yet to re-open, disrupting supply chains in China and beyond, as highlighted by Apple. Nomura downgraded its China first-quarter economic growth forecast to 3%, half the pace of the fourth quarter, from its previous forecast of 3.8%, and added there was a risk it could be even weaker. Also hurting market sentiment was news that the Trump administration is considering changing U.S. regulations to allow it to block shipments of chips to Huawei Technologies from companies such as Taiwan’s, the world’s largest contract chipmaker.
  • The euro fell toward a three-year low versus the dollar ahead of a highly watched German survey on Tuesday, which is expected to show a sharp slump in investor confidence and fuel growing pessimism about the outlook for Europe's largest economy. Financial markets clung to tight ranges following a U.S. public holiday on Monday, shifting the investor focus to European news and developments in the coronavirus crisis. Among Asian currencies, the Australian dollar slipped below the 67 U.S. cent level after minutes from the central bank's last meeting revived the prospect of policy easing while the Chinese yuan was weighed by worries about the economic impact of the coronavirus. Sentiment for the euro has worsened dramatically this month after weak manufacturing and gross domestic product data from Germany, Europe's largest economy, suggested that the euro zone is more vulnerable to external shocks that previously thought. Since the start of February, the single currency has lost 2.4% versus the greenback as disappointing economic data raised concerns that euro zone monetary policy will have to remain accommodative for much longer. The euro's next hurdle is the release of Germany's ZEW survey later on Tuesday, which is forecast to show economic sentiment slipped from the highest since July 2015. Sterling also nursed losses against the dollar and the euro due to worries about economic ties between Britain and the European Union as both sides laid out conflicting views on how to proceed with trade negotiations. Prime Minister Boris Johnson's Europe adviser David Frost said on Monday Britain would not be threatened into following EU rules to win a free trade agreement with the bloc. Frost's comments contrast with those of European Commission President Ursula von der Leyen, who has called on Britain to guarantee fair competition based on ambitious environmental and labor standards. Britain left the EU last month and the two sides will now start negotiating a new relationship from trade to security. The onshore yuan was a tad lower at 6.9859 versus the dollar, unsettled by a decline in Chinese shares after Apple Inc said it will not meet sales targets because the virus epidemic has slowed production and demand in China. Currency traders are cautiously monitoring new data on the virus given uncertainty about the actual number of cases and difficulties in estimating when the epidemic will peak.
  • Oil prices fell on Tuesday, tracking losses in financial markets on lingering concerns over the economic impact of the coronavirus outbreak in China and its effect on oil demand. U.S. stock futures slipped from record levels on Tuesday after Apple Inc (O:AAPL), the most valuable company in the United States, said it will not meet its revenue guidance for the March quarter as the coronavirus outbreak slowed production and weakened demand in China. The number of new coronavirus infections in mainland China fell below 2,000 on Tuesday for the first time since January, Chinese health officials said, although global experts warn it is too early to say the outbreak is being contained. The International Energy Agency (IEA) said last week the virus was set to cause oil demand to fall by 435,000 barrels per day (bpd) year-on-year in the first quarter, in what would be the first quarterly drop since the financial crisis in 2009.Still, with some Chinese independent refineries snapping up crude supplies after being absent from the market for weeks, traders held out hopes that China's demand could recover in coming months. Investors are also anticipating that the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, will approve a proposal to deepen production cuts to tighten global supplies and support prices. The group, known as OPEC+, has an agreement to cut oil output by 1.7 million bpd until the end of March. Oil output from Libya has fallen sharply since Jan. 18 because of a blockade of ports and oil fields by groups loyal to eastern-based commander Khalifa Haftar. Libya's national oil corporation, NOC, said on Monday that oil production was at 135,745 barrels per day as of Monday, compared with 1.2 million bpd before the stoppage.

 

 
Intraday RESISTANCE LEVELS
18th February 2020 R1 R2 R3
GOLD-XAU 1,590-1,600 1,610 1,620
Silver-XAG 17.90-18.25 18.50 18.70-19.10
Crude Oil 52.20-52.70 53.80 54.50-55.00
EURO/USD 1.0850-1.0930 1.0980 1.1010-1.1050
GBP/USD 1.3020-1.3070 1.3120 1.3190-1.3270
USD/JPY 110.00-110.30 110.70 111.20-111.50

Intraday SUPPORTS LEVELS
18th February 2020 S1 S2 S3
GOLD-XAU 1,580-1,571 1.560 1,548-1,542
Silver-XAG 17.40-17.10 16.60 16.25-15.90
Crude Oil 51.70 51.00 50.20-49.40
EURO/USD 1.0710 1.0710 1.0650-1.0580
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 (18th 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 Monday made its intraday high of US$1583.68/oz and low of US$1578.79/oz. Gold down 0.044% at US$1581.40/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 1580-1536 with risk below 1536, targeting 1584-1590 and 1600-1610. Sell below 1584-1620 keeping stop loss closing above 1620, targeting 1580-1571-1560 and 1548-1542-1536.

 
Intraday Support Levels
S1     1,580-1,571
S2     1.560
S3     1,548-1,542
Intraday Resistance Levels
R1     1,590-1,600
R2     1,610
R3     1,620

Technical Indicators

Name   Value Action
14DRSI  

61.367

Buy
20-DMA   1570.50 Buy
50-DMA  

1537.03

Buy
100-DMA   1509.61 Buy
200-DMA   1465.40 Buy
STOCH(5,3)   91.621 Buy
MACD(12,26,9)   9.161 Sell

Silver - XAG

AAFX TRADING

Silver on Monday made its intraday high of US$17.87/oz and low of US$17.68/oz settled up by 0.327% at US$17.77/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   53.397 Buy
20-DMA   17.74 Sell
50-DMA   17.62 Buy
100-DMA   17.48 Buy
200-DMA   16.84 Buy
STOCH(5,3)   73.268 Buy
MACD(12,26,9)   0.0035 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Monday made an intra‐day high of US52.48/bbl, intraday low of US$52.03/bbl and settled down by 0.150% to close at US$52.40/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 51.00-47.40 with risk daily closing below 47.50 and targeting 51.60-52.20 and 52.70-53.80. Sell in between 51.90-55.00 with stop loss at 55.00; targeting 51.00-50.20-49.40 and 48.00-48.50.

 
Intraday Support Levels
S1     51.70
S2     51.00
S3     50.20-49.40

Intraday Resistance Levels
R1     52.20-52.70
R2     53.80
R3     54.50-55.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   41.112 Sell
20-DMA   52.13 Sell
50-DMA   56.86 Sell
100-DMA   56.29 Sell
200-DMA   56.50 Sell
STOCH(5,3)   90.130 Buy
MACD(12,26,9)   -1.617 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.10828/EUR, high of US$1.0850/EUR and settled the day down by 0.054% to close at US$1.0834/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 1.0810-1.0580 with risk below 1.0580, targeting 1.0850-1.0930-1.0980 and 1.10110-1.1050. Sell below 1.0850-1.1050 targeting 1.0890-1.0810 and 1.0780-1.0710 with stop-loss at daily closing above 1.1250.

 
Intraday Support Levels
S1     1.0710
S2     1.0710
S3     1.0650-1.0580

Intraday  Resistance Levels
R1     1.0850-1.0930
R2     1.0980
R3     1.1010-1.1050

TECHNICAL INDICATORS
Name   Value Action
14DRSI   29.057 Buy
20-DMA   1.1036 Sell
50-DMA   1.1088 Sell
100-DMA   1.1063 Sell
200-DMA   1.1193 Sell
STOCH(5,3)   2.758 Sell
MACD(12,26,9)   -0.001 Buy

GBP/USD

AAFX TRADING

GBP/USD on Monday made an intra‐day low of US$1.2997/GBP, high of US$1.3053/GBP and settled the day down by 0.0421% to close at US$1.3005/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.2924) 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 1.3020-1.3270 with targets at 1.2980-1.2930 and 1.2870-1.2840-1.2760 stop-loss should be below 1.3200. Buy above 1.2980-1.2750 with targets 1.3070-1.3120-1.3190 and 1.3270-1.3300 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     1.3020-1.3070
R2     1.3120
R3     1.3190-1.3270

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

48.909

Buy
20-DMA   1.3023 Sell
50-DMA   1.3064 Sell
100-DMA   1.2924 Buy
200-DMA   1.2688 Buy
STOCH(5,3)   67.940 Sell
MACD(12,26,9)   0.0027 Sell

USD/JPY

AAFX TRADING

USD/JPY on Monday made intra‐day low of JPY109.71/USD and made an intraday high of JPY109.95/USD and settled the day up by 0.0318% at JPY109.86/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 109.50-108.90-108.50 and 107.80-107.00-106.50. Long positions above 109.50-107.00 with targets of 110.00-110.70 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

AAFX TRADING
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