AAFX TRADING

Daily Market Lookup

  • European stock index futures fell more than 3% on Wednesday as dismal economic data from Asia underpinned the ongoing damage from the coronavirus pandemic and fanned fears of a deep global recession. But figures on Wednesday showed factory activity contracting across most of Asia in March as the outbreak paralyzed supply chains, with sharp falls in export power-houses Japan and South Korea overshadowing a modest improvement in China. The pan-European STOXX 600 index ended Tuesday with its worst quarter in 18 years, losing about $2.8 trillion in market value, as lockdown measures to contain the health crisis upended business activity, raising the threat of corporate defaults and mass layoffs. Profit for companies listed on the benchmark index is now expected to slide by a fifth in the second quarter, deepening a European corporate recession. With the outbreak still far from contained globally, U.S. President Donald Trump warned Americans of a “painful” two weeks ahead, with signs the U.S. death toll could stretch into the hundreds of thousands even with social distancing measures.
  • The dollar traded a little higher Wednesday, helped by its status as a safe haven currency as manufacturing data out of Asia pointed to a severe economic slowdown as the region tries to combat the coronavirus pandemic. Factory activity dropped sharply across most of Asia in March, according to the latest Purchasing Managers' Index surveys, with regional economic powerhouses Japan and South Korea, posting their biggest contractions in about a decade. Limiting the greenback’s gains was the news that the U.S. Federal Reserve late Tuesday broadened the ability of dozens of foreign central banks to access dollars during the coronavirus crisis by allowing them to exchange their holdings of U.S. Treasury securities for overnight dollar loans. One of the regions hardest hit has been Central and Eastern Europe, an area trying to cope with the economic downturn while also facing political uncertainty. On Monday Hungary’s Prime Minister Viktor Orban received the right to rule by decree indefinitely, undermining the principles of a democracy, while in Poland the ruling party is pressing ahead with May’s presidential election despite opposition given the coronavirus pandemic. he U.S dollar rose on Wednesday as traders continued to search for safe haven. Appetite for the safety of cash dollar continued to rise after reports in the U.S. said scientists now believe the virus could kill between 100,000 and 240,000 Americans despite social distancing measures. Dr. Anthony S. Fauci, the nation’s leading infectious disease expert, and Dr. Deborah L. Birx, who is coordinating the coronavirus response, displayed that grim projection at the White House on Tuesday, calling it “our real number.” The virus has now killed more than 42,000 people and infected more than 851,000 in 205 countries. However, the gains of dollar were limited today as the Federal Reserve pumped more dollars into the system to calm markets. The Fed allowed certain foreign central banks to exchange their U.S. Treasury securities for overnight dollar loans yesterday. It is also purchasing U.S. bonds at an unprecedented rate and implemented programs to support credit markets. The USD/CNY pair gained 0.1% to 7.0880 as the Caixin manufacturing Purchasing Manager’s Index for March showed a slight economic expansion with a reading of 50.1. Analyst forecasts prepared by Investing.com predicted a reading of 45.5.
  • Global crude oil prices slid further on Wednesday, following their biggest-ever quarterly and monthly losses, as a bigger-than-expected rise in U.S. inventories and a widening rift within OPEC heightened oversupply fears. Oil prices are near their lowest since 2002 amid the global coronavirus crisis that has brought a worldwide economic slowdown and slashed oil demand. Crude futures ended the quarter down nearly 70% after record losses in March. U.S. crude inventories rose by 10.5 million barrels last week, far exceeding forecasts for a 4 million barrel build-up, data from industry group the American Petroleum Institute showed. Nearly 800,000 people have been infected across the world and more than 38,800 have died, according to a Reuters tally. The bearish mood in the market was also fuelled by a rift within the Organization of the Petroleum Exporting Countries (OPEC). Saudi Arabia and other members of OPEC were unable to come to an agreement on Tuesday to meet in April to discuss sliding prices. Adding to the downward pressure, sources told Reuters that top U.S. officials have for now put aside a proposal for an alliance with Saudi Arabia to manage the global oil market. The Trump administration plans to lease out space for energy companies to store oil in the nation's Strategic Petroleum Reserve, after a previous effort to buy millions of barrels for the emergency stockpile was cancelled over a lack of funding. A Reuters survey of 40 analysts forecast Brent would average $38.76 a barrel in 2020, 36% lower than the $60.63 forecast in a February survey. The bearish mood in the market was slightly improved from the Kremlin’s announcement on Monday that Russian President Vladimir Putin and his U.S. counterpart Donald Trump agreed to their top energy officials discussing stabilizing oil markets. But with Russia and Saudi Arabia having free reign over production levels starting today, oil looks no closer to solving its dilemma of oversupply as the COVID-19 pandemic continues to cut demand. On Tuesday, Saudi Arabia and other members of OPEC were unable to come to an agreement to meet this month and discuss sliding prices.

 

 
Intraday RESISTANCE LEVELS
1st April 2020 R1 R2 R3
GOLD-XAU 1,600 1,612 1,625-1,640
Silver-XAG 14.40-15.00 15.30 16.00-16.35
Crude Oil 23.10 24.00 25.30-26.10
EURO/USD 1.1010-1.1050 1.1085 1.1150-1.1200
GBP/USD 1.2420-1.2500 1.2570 1.2650-1.2700
USD/JPY 109.30 110.20 110.90-111.50

Intraday SUPPORTS LEVELS
1st April 2020 S1 S2 S3
GOLD-XAU 1,574-1,560 1,547 1,536-1,528
Silver-XAG 13.90 13.60 14.40-15.00
Crude Oil 22.00-21.00 20.45 19.80-19.00
EURO/USD 1.0900-1.0850 1.0770 1.0700-1.0630
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 (1st April 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 Buy
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Tuesday made its intraday high of US$1622.53/oz and low of US$1573.74/oz. Gold down 2.63% at US$1576.11/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 1590-1546 with risk below 1546, targeting 1605-1625-1640-1655 and 1664-1675-1690. Sell below 1605-1654 keeping stop loss closing above 1654, targeting 1590-1560 and 1546-1536.

 
Intraday Support Levels
S1     1,574-1,560
S2     1,547
S3     1,536-1,528
Intraday Resistance Levels
R1     1,600
R2     1,612
R3     1,625-1,640

Technical Indicators

Name   Value Action
14DRSI  

50.609

Buy
20-DMA   1587.61 Buy
50-DMA  

1591.02

Buy
100-DMA   1544.82 Buy
200-DMA   1510.92 Buy
STOCH(5,3)   39.621 Sell
MACD(12,26,9)   -11.052 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$14.24/oz and low of US$13.83/oz settled down by 3.16% at US$13.95/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     14.40-15.00

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

TECHNICAL INDICATORS
Name   Value Action
14DRSI   39.250 Buy
20-DMA   14.53 Sell
50-DMA   16.46 Sell
100-DMA   16.99 Sell
200-DMA   16.99 Buy
STOCH(5,3)   37.268 Buy
MACD(12,26,9)   -1.150 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US23.67/bbl, intraday low of US$21.90/bbl and settled up by 0.227% to close at US$21.90/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

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.

 
Intraday Support Levels
S1     22.00-21.00
S2     20.45
S3     19.80-19.00

Intraday Resistance Levels
R1     23.10
R2     24.00
R3     25.30-26.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   28.911 Sell
20-DMA   29.59 Sell
50-DMA   42.64 Sell
100-DMA   50.78 Sell
200-DMA   53.37 Sell
STOCH(5,3)   34.130 Buy
MACD(12,26,9)   -6.327 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.10926/EUR, high of US$1.1052/EUR and settled the day down by 0.1160% to close at US$1.1026/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 1.0900-1.0700 with risk below 1.0700, targeting 1.0900-1.10850-1.1150 and 1.1170-1.1200-1.1250. Sell below 1.1010-1.1200 targeting 1.0900-1.0850a and 1.0770-1.0700-1.0630 with stop-loss at daily closing above 1.1200.

 
Intraday Support Levels
S1     1.0900-1.0850
S2     1.0770
S3     1.0700-1.0630

Intraday  Resistance Levels
R1     1.1010-1.1050
R2     1.1085
R3     1.1150-1.1200

TECHNICAL INDICATORS
Name   Value Action
14DRSI   50.673 Buy
20-DMA   1.1048 Buy
50-DMA   1.0994 Buy
100-DMA   1.1044 Buy
200-DMA   1.1078 Buy
STOCH(5,3)   80.758 Buy
MACD(12,26,9)   0.008 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2240/GBP, high of US$1.2472/GBP and settled the day up by 0.016% to close at US$1.2406/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   1.2300 Buy
50-DMA   1.2706 Buy
100-DMA   1.2867 Buy
200-DMA   1.2658 Buy
STOCH(5,3)   90.940 Sell
MACD(12,26,9)   -0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY107.45/USD and made an intraday high of JPY108.72/USD and settled the day up by 0.198% at JPY107.52/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     109.30
R2     110.90-111.50
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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