AAFX TRADING

Daily Market Lookup

  • European stock markets fell sharply on Monday, weighed on by President Donald Trump's decision to abandon his plans for an early reopening of the U.S. economy as the coronavirus pandemic showed no signs of abating. The tone within the market remains cautious as the number of Covid-19 infections headed rapidly towards 750,000 worldwide. The number of deaths from the virus in Italy, the epicenter of the outbreak in Europe, is now well over 10,000, according to data from Johns Hopkins University. Overnight, President Donald Trump had abandoned his hope of lifting restrictions on the U.S. economy by Easter, extending the current guidance on social distancing to the end of April. Trump said while 100,000 is "a horrible number," if the U.S. can keep its death toll to "100,000, so we have between 100,000 and 200,000, we altogether have done a very good job." Earlier Monday, the People’s Bank of China cut the rate on 7-day reverse repos, which acts as an informal reference point for its other lending facilities, to 2.2% from 2.4%, the largest reduction in nearly five years. The PBoC injected 50 billion yuan ($7.04 billion) into the banking system through repos this week. There is a lot of economic data coming out of the euro zone this week. Monday’s March economic sentiment data, at 5 AM ET, will offer insights into how businesses and consumers assess the situation, even though the numbers predate new restrictive measures put in place since the survey was conducted. French carmaker Renault followed suit, saying production at all its plants across the world had been halted due to the impact of the coronavirus crisis, apart from its plants in China and South Korea. Renault shares dropped 1.8%.
  • The dollar slowed its descent after a week of declines and the safe-haven yen edged ahead on Monday, as coronavirus lockdowns tightened across the world and investors braced for a prolonged period of uncertainty. The weekend brought more bad news on the virus front. The U.S. has emerged as the latest epicenter of the outbreak, with more than 137,000 cases and 2,400 deaths. President Donald Trump, who had talked about reopening the economy for Easter, on Sunday extended guidelines for social restrictions to April 30 and said the peak of the death rate could be two weeks away. Australia also ratcheted up control measures, while an extension to lockdowns in Italy loom The moves come after the dollar has surged amid a scramble for cash and then subsided as central bank launched unprecedented liquidity measures. Over the past two weeks the dollar has posted its biggest weekly rise since the 2008 financial crisis and then its biggest weekly drop since 2009. Yet as signs of funding stress have eased, but not abated, the dollar remains at elevated levels. Monday's moves showed some hints of that, since dollar gains were modest and in tandem with rises in gold, bonds and the yen. The U.S dollar was up on Monday as the COVID-19 pandemic continues to decrease investors’ appetite for risk. Ever increasing numbers of global COVID-19 cases are driving investors to seek haven in the dollar. he dollar is back in demand Monday as hopes of an early end to the shutdown which has paralysed the U.S. economy were dashed over the weekend, prompting some traders to head back to the greenback safe haven. On Sunday, President Donald Trump extended restrictive social distancing guidelines to the end of April, bowing to public-health experts who presented him with even more dire projections for the expanding coronavirus pandemic. It was a stark shift in tone by the president, who only days ago discussed reopening the country in a few weeks. Sterling has made something of a comeback in the last week or so, helped by the injection of vast amounts of dollars by the Federal Reserve into the system to stop a funding crunch. However, more losses look likely for the pound going forward, especially after Fitch downgraded its credit rating on the U.K. by one notch to AA- from AA on Friday. The credit agency cited the significant increase in fiscal spending as a result of the coronavirus, as well as the uncertainty regarding the post-Brexit trade relationship with the EU. This is the first downgrade of a sovereign on the back of the coronavirus and the increase in fiscal spending.
  • Collapsing oil prices have left African producers facing not only lost revenue when they most need it to tackle coronavirus, but also a fall in hard-won market share they may never regain. The continent's producers such as Nigeria, Angola and Algeria cannot compete with the lower costs of erstwhile allies Saudi Arabia and Russia, who are flooding the market with oil. In a sign of their desperation, the Republic of Congo's oil minister wrote to OPEC secretary general Mohammad Barkindo on March 20 calling for an urgent meeting to find a way to keep member nations from sinking into recession. But while desperate for OPEC+, the Organization of the Petroleum Exporting Countries plus Russia, to ride to the rescue, Africa's oil producers have little leverage over them. Although non-OPEC nations such as Britain, Norway and the United States all have relatively high-cost production, their diversified economies mean they are not dependent on oil. As well as hitting already tight budgets, the oil price drop had led oil majors to cut billions from spending plans. The longer-term impact for the comparatively costly African fields could be far more painful. In Nigeria, for instance, production is forecast to fall by 35% without offshore field investments. Across Africa, Rystad estimates delayed spending could mean 200,000 barrels per day (bpd) drop in expected output by 2025. Larger nations are also elbowing African producers out of incredibly competitive spot trade.

 

 
Intraday RESISTANCE LEVELS
30th March 2020 R1 R2 R3
GOLD-XAU 1,625-1,640 1,654 1,665-1690
Silver-XAG 14.40-15.00 15.30 16.00-16.35
Crude Oil 22.00-23.10 24.00 25.30-26.10
EURO/USD 1.1085-1.1150 1.1200 1.1250-1.1300
GBP/USD 1.2420-1.2500 1.2570 1.2650-1.2700
USD/JPY 108.30-109.30 110.20 110.90-111.50

Intraday SUPPORTS LEVELS
30th March 2020 S1 S2 S3
GOLD-XAU 1,605-1,612 1,590 1,576-1,560
Silver-XAG 13.90 13.60 13.00-12.30
Crude Oil 21.00-20.45 19.80 19.00-18.05
EURO/USD 1.1050-1.1010 1.0900 1.0850-1.0770
GBP/USD 1.2320-1.2250 1.2180 1.2130-1.2000
USD/JPY 107.50 106.90 106.50-106.00

Intra-Day Strategy (30th March 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$1631.16/oz and low of US$1613./oz. Gold down 0.242% at US$1631.14/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 1605-1546 with risk below 1546, targeting 1625-1640-1655 and 1664-1675-1690. Sell below 1605-1654 keeping stop loss closing above 1654, targeting 1605-1590-1560 and 1546-1536.

 
Intraday Support Levels
S1     1,605-1,612
S2     1,590
S3     1,576-1,560
Intraday Resistance Levels
R1     1,625-1,640
R2     1,654
R3     1,665-1690

Technical Indicators

Name   Value Action
14DRSI  

53.609

Buy
20-DMA   1589.38 Buy
50-DMA  

1585.49

Buy
100-DMA   1537.82 Buy
200-DMA   1505.16 Buy
STOCH(5,3)   87.621 Buy
MACD(12,26,9)   -11.052 Sell

Silver - XAG

AAFX TRADING

Silver on frifay made its intraday high of US$14.61/oz and low of US$14.14/oz settled up by 1.00% at US$14.47/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 13.90-11.75 targeting 14.50-14.80-15.30 and 16.00-16.35; stop breakage below 11.75. Sell below 14.50-16.35 with stop loss above 16.35; targeting 13.90-13.60-13.00 and 12.50-11.75-11.25.

 
Intraday  Support Levels
S1     13.90
S2     13.60
S3     13.00-12.30

Intraday  Resistance Levels
R1     14.40-15.00
R2     15.30
R3     16.00-16.35

TECHNICAL INDICATORS
Name   Value Action
14DRSI   40.250 Buy
20-DMA   15.26 Sell
50-DMA   16.84 Sell
100-DMA   17.06 Sell
200-DMA   17.02 Buy
STOCH(5,3)   93.268 Buy
MACD(12,26,9)   -1.150 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Friday made an intra‐day high of US24.49/bbl, intraday low of US$22.30/bbl and settled down by 5.25% to close at US$23.07/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 24.00-22.00 with risk daily closing below 22.00 and targeting 25.30-26.10 and 27.60-28.50-30.00. Sell in between 25.00-27.40 with stop loss at 28.00; targeting 24.30 and 26.10-27.40.

 
Intraday Support Levels
S1     21.00-20.45
S2     19.80
S3     19.00-18.05

Intraday Resistance Levels
R1     22.00-23.10
R2     24.00
R3     25.30-26.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   27.911 Sell
20-DMA   32.14 Sell
50-DMA   44.11 Sell
100-DMA   51.49 Sell
200-DMA   53.73 Sell
STOCH(5,3)   20.130 Buy
MACD(12,26,9)   -6.460 Sell

EUR/USD

AAFX TRADING

EUR/USD on Friday an intraday low of US$1.09526/EUR, high of US$1.1145/EUR and settled the day up by 3.33% to close at US$1.11396/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 1.1050-1.0850 with risk below 1.0850, targeting 1.10850- 1.1150-1.1170 and 1.1200-1.1250-1.1300. Sell below 1.1085-1.1300 targeting 1.1050-1.1010-1.900 and 1.0850-1.0700 with stop-loss at daily closing above 1.1150.

 
Intraday Support Levels
S1     1.1050-1.1010
S2     1.0900
S3     1.0850-1.0770

Intraday  Resistance Levels
R1     1.1085-1.1150
R2     1.1200
R3     1.1250-1.1300

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.673 Buy
20-DMA   1.1059 Buy
50-DMA   1.0996 Buy
100-DMA   1.1044 Buy
200-DMA   1.1080 Buy
STOCH(5,3)   65.758 Buy
MACD(12,26,9)   0.008 Buy

GBP/USD

AAFX TRADING

GBP/USD on Friday made an intra‐day low of US$1.2130/GBP, high of US$1.2484/GBP and settled the day up by 2.49% to close at US$1.2455/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 1.2420-1.2700 with targets at 1.2320-1.2250-1.2180 and 1.2130-1.2000-1.1900 stop-loss should be below 1.2570. Buy above 1.2320-1.2000 with targets 1.2420-1.2500-1.2570 and 1.2650-1.2700 with stop loss closing below 1.1290.

 
Intraday Support Levels
S1     1.2320-1.2250
S2     1.2180
S3     1.2130-1.2000

Intraday Resistance Levels
R1     1.2420-1.2500
R2     1.2570
R3     1.2650-1.2700

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

50.801

Buy
20-DMA   1.23 Buy
50-DMA   1.2743 Buy
100-DMA   1.2880 Buy
200-DMA   1.2663 Buy
STOCH(5,3)   73.940 Sell
MACD(12,26,9)   -0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY107.75/USD and made an intraday high of JPY109.47/USD and settled the day down by 1.270% at JPY108.02/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 108.30-113.00 with risk above 113.00 targeting 108.30-107.50 and 106.80-106.00. Long positions above 109.30-105.00 with targets of 110.20-110.90 and 111.50-112.20 with stop below 105.00.

 
Intraday Support Levels
S1     107.50
S2     106.90
S3     106.50-106.00

INTRADAY RESISTANCE LEVELS
R1     108.30-109.30
R2     110.20
R3     110.90-111.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   56.805 Buy
20-DMA   107.54 Sell
50-DMA   108.92 Sell
100-DMA   108.95 Sell
200-DMA   108.26 Sell
STOCH(9,6)   89.253 Sell
MACD(12,26,9)   -0.161 Sell

AAFX TRADING
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