AAFX TRADING

Daily Market Lookup

  • Stock markets across the globe eked out gains on Tuesday, riding out sharp swings on Wall Street as mixed corporate earnings results and dramatic moves in oil prices delivered yet another dose of investor jitters. Conflicting measures and warnings on the coronavirus pandemic cast an uneasy tone. Plans to ease major economies out of coronavirus lockdowns were continuing even as experts issued fresh warnings against reopening too soon. A predictive model showed the outbreak could take more than 74,000 U.S. lives by August, compared with an earlier forecast of 67,000, if the lockdown were to be lifted too early. Germany’s coronavirus infection rate has edged up from earlier this month and people should stay at home as much as they can despite a lockdown relaxation last week, the head of an institute for infectious diseases said. Reassuring UBS earnings lifted European banks nearly 5%, while Wall Street digested upbeat numbers from industrial conglomerate 3M Co (MMM.N), a maker of N95 respirator masks, and drugmaker Pfizer Inc (PFE.N). Oil prices ended mixed with Brent hinging on positive sentiment about the easing of lockdowns, while U.S. crude traders remained cautious as storage capacities were filling up fast. Markets are looking for any forward guidance from the U.S. Federal Reserve, which is due to issue a policy statement at the close of its two-day meeting on Wednesday. The European Central Bank meets on Thursday. Analysts said it was unlikely the Fed would make further major policy moves, given the scope and depth of its recent action to counter the economic damage caused by the novel coronavirus.
  • The U.S. dollar was a little lower in early European trade Thursday, with traders having to balance the potential for more central bank largesse with the vivid illustrations of the damage the coronavirus outbreak has been doing to the global economy. The focus has turned from the Federal Reserve to the European Central Bank, as the governing council has to decide on Thursday if more than 1 trillion euros ($1.1 trillion) in asset purchases and a generous lending plan are enough to keep companies and households afloat. The ECB is meeting on a day that eurozone economies are following the U.S. in announcing the biggest quarterly drops in GDP in over a decade. Figures for the euro zone as a whole are due at 5. The Federal Reserve kept rates unchanged on Wednesday, but expressed a willingness to do more to support the economy if this was needed. And more may well be needed judging from the latest economic growth figures. U.S. gross domestic product fell 4.8% in the first quarter, the worst economic decline since 2008, exceeding economists’ forecasts for a 4% decline in output, and the second quarter is likely to be far worse. The dollar nursed losses on Thursday after the U.S. Federal Reserve left the door open to more monetary easing and dampened expectations for a quick economic recovery from the coronavirus pandemic. The greenback was also weighed down as signs the pandemic is receding in other countries and reduced safe-haven demand for holding funds in dollars. Additionally boosting appetite for riskier currencies were positive trial results of an experimental COVID-19 treatment. The euro held steady before a European Central Bank meeting later on Thursday where policymakers are likely to expand debt purchases to include junk bonds and take other steps to ease conditions in credit markets. More countries are taking steps to re-open their economies as coronavirus infections slow, giving some cause for optimism. However, it will likely take several months for U.S. consumer spending to fully recover given the massive job losses, which has discouraged any extensive dollar buying. After a two-day policy meeting ending Wednesday, the Fed kept interest rates near zero and promised to expand emergency programmes as needed to help the battered economy. Fed Chairman Jerome Powell offered no sanguine words about how fast the country might return - if ever - to the near-record low unemployment and solid growth of just a few weeks ago. Sentiment for the dollar also took a hit after data on Wednesday showed U.S. gross domestic product fell in the first quarter at the sharpest pace since the Great Recession. Economists say the second quarter could be even worse. The United States and other major economies forced businesses to close and kept people at home to slow the spread of the novel coronavirus, which slammed the brakes on global growth. The ECB, which announces its policy decision later Thursday, is under pressure to keep government bond yields from rising after rating agency Fitch cut Italy's credit rating to one notch above junk due to the financial burden of the coronavirus outbreak. The ECB is already printing money at a record rate to buy up ballooning state debt. However, European Union officials have struggled to agree the details of a joint recovery fund, which shifts the burden to the ECB, analysts say.
  • Oil prices jumped on Thursday, buoyed by signs that the U.S. crude glut is not growing as quickly as expected and that fuel demand battered by COVID-19 restrictions is starting to pick up. U.S. crude inventories grew by 9 million barrels last week to 527.6 million barrels, U.S. Energy Information Administration data showed, well below the 10.6 million-barrel rise analysts polled by Reuters had expected. U.S. gasoline stockpiles fell by 3.7 million barrels from record highs the previous week, with a slight rise in fuel demand offseting a rebound in refinery output. Global energy demand could slump by a record 6% in 2020 due to economic lockdowns from the coronavirus pandemic, the International Energy Agency (IEA) said on Thursday. U.S. President Donald Trump said his administration will soon release a plan to help the country's oil companies, which Treasury Secretary Steven Mnuchin said could include adding millions of barrels of oil to already-teeming national reserves. Meanwhile, Western Europe's largest oil producer Norway said it will slash its output from June to December of 2020, the first time in 18 years it has joined other major producers to shore up prices.

 

 
Intraday RESISTANCE LEVELS
30th April 2020 R1 R2 R3
GOLD-XAU 1,720-1,729 1,740 1,747-1,760
Silver-XAG 15.60-16.10 16.70 17.00-17.50
Crude Oil 19.00-20.00 20.80 22.00-22.75
EURO/USD 1.0900 1.0970 1.1030-1.1060
GBP/USD 1.2500 1.2550 1.2590-1.2645
USD/JPY 106.90-107.50 109.40-110.20 109.40-110.20

Intraday SUPPORTS LEVELS
30th April 2020 S1 S2 S3
GOLD-XAU 1,700-1,690 1,674 1,660-1,650
Silver-XAG 13.90 13.90 13.60-12.90
Crude Oil 18.00-16.30 15.50 14.03-12.10
EURO/USD 1.0820-1.0750 1.0700 1.0630-1.0570
GBP/USD 1.2470-1.2400 1.2320 1.2250-1.2180
USD/JPY 106.20 105.60-105.00 104.30

Intra-Day Strategy (30th 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 Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Wednesday made its intraday high of US$1717.46/oz and low of US$1697.78/oz. Gold up 0.226% at US$1711.37/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1596) and breakage below will call for 1550. 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 overbought territory and giving negative crossover to bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1700-1645 with risk below 1645, targeting 1720-1729 and 1740-1755-1774. Sell below 1720-1774 keeping stop loss closing above 1774, targeting 1705-1690-1674 and 1660-1645.

 
Intraday Support Levels
S1     1,700-1,690
S2     1,674
S3     1,660-1,650
Intraday Resistance Levels
R1     1,720-1,729
R2     1,740
R3     1,747-1,760

Technical Indicators

Name   Value Action
14DRSI  

57.609

Buy
20-DMA   1657.31 Buy
50-DMA  

1620.94

Buy
100-DMA   1574.80 Buy
200-DMA   1529.98 Buy
STOCH(5,3)   30.621 Sell
MACD(12,26,9)   -27.894 Sell

Silver - XAG

AAFX TRADING

Silver on Wednesday made its intraday high of US$15.36/oz and low of US$15.07/oz settled up by 0.745% at US$15.27 /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 overbought region and giving negative crossover to show upside move for the intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above, buy above 15.00-13.00 targeting 15.60-16.10 and 16.70-17.00-17.40; stop breakage below 13.00. Sell below 15.60-17.40 with stop loss above 17.40; targeting 15.00-14.40 and 13.90-13.60-13.00.

 
Intraday  Support Levels
S1     13.90
S2     13.90
S3     13.60-12.90

Intraday  Resistance Levels
R1     15.60-16.10
R2     16.70
R3     17.00-17.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.370 Buy
20-DMA   14.86 Buy
50-DMA   15.67 Sell
100-DMA   16.62 Sell
200-DMA   16.99 Sell
STOCH(5,3)   48.268 Buy
MACD(12,26,9)   -0.374 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Wednesday made an intra‐day high of US18.22/bbl, intraday low of US$14.73/bbl and settled up by 10.4% to close at US$16.92/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 40.00 which is a resistance level and breakage above will call for 44.00. MACD is below zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving positive crossover for confirmation of bullish 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 18.00-14.10 with risk daily closing below 14.20 and targeting 19.00-20.00 and 20.80-22.00-22.75. Sell in between 19.00-22.75 with stop loss at 22.80; targeting 18.00-16.30 and 14.00-12.10-11.50.

 
Intraday Support Levels
S1     18.00-16.30
S2     15.50
S3     14.03-12.10

Intraday Resistance Levels
R1     19.00-20.00
R2     20.80
R3     22.00-22.75

TECHNICAL INDICATORS
Name   Value Action
14DRSI   32.117 Sell
20-DMA   16.71 Buy
50-DMA   19.32 Sell
100-DMA   23.84 Sell
200-DMA   24.94 Sell
STOCH(5,3)   41.130 Sell
MACD(12,26,9)   -1.406 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.0817/EUR, high of US$1.0884/EUR and settled the day up by 0.520% to close at US$1.0874/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1031), which become immediate resistance level, break above will target 1.1090. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in overbought territory and giving positive crossovers to signal for bullish 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 1.0820-1.0570 with risk below 1.0570, targeting 1.10900-1.0970 and 1.1030-1.1060. Sell below 1.0900-1.1060 targeting 1.0900-1.0770-1.0700 and 1.0630-1.0570 with stop-loss at daily closing above 1.1100.

 
Intraday Support Levels
S1     1.0820-1.0750
S2     1.0700
S3     1.0630-1.0570

Intraday  Resistance Levels
R1     1.0900
R2     1.0970
R3     1.1030-1.1060

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.562 Buy
20-DMA   1.0900 Buy
50-DMA   1.0960 Buy
100-DMA   1.1026 Buy
200-DMA   1.1054 Buy
STOCH(5,3)   53.758 Buy
MACD(12,26,9)   -0.0047 Buy

GBP/USD

AAFX TRADING

GBP/USD on Wednesday made an intra‐day low of US$1.2388/GBP, high of US$1.2484/GBP and settled the day up by 0.395% to close at US$1.2469/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.2647) is become major resistance level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

Trading Strategy: Neutral to Sell

On daily charts, prices are sustaining below 200DMA (1.2647) is become major resistance level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

 
Intraday Support Levels
S1     1.2470-1.2400
S2     1.2320
S3     1.2250-1.2180

Intraday Resistance Levels
R1     1.2500
R2     1.2550
R3     1.2590-1.2645

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

48.554

Buy
20-DMA   1.2379 Buy
50-DMA   1.2525 Sell
100-DMA   1.2797 Sell
200-DMA   1.2646 Sell
STOCH(5,3)   17.940 Sell
MACD(12,26,9)   -0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Wednesday made intra‐day low of JPY106.35/USD and made an intraday high of JPY106.89/USD and settled the day down by 0.233% at JPY106.60/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (108.30), 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 neutral territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 106.90-110.50 with risk above 110.50 targeting 106.20-105.60-105.00 and 104.30. Long positions above 106.90-105.00 with targets of 106.90-107.50-108.30 and 109.40-110.20-110.90 with stop below 105.00.

 
Intraday Support Levels
S1     106.20
S2     105.60-105.00
S3     104.30

INTRADAY RESISTANCE LEVELS
R1     106.90-107.50
R2     109.40-110.20
R3     109.40-110.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   52.904 Buy
20-DMA   108.23 Buy
50-DMA   108.75 Sell
100-DMA   108.95 Sell
200-DMA   108.31 Buy
STOCH(9,6)   52.253 Sell
MACD(12,26,9)   -0.161 Sell

AAFX TRADING
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