AAFX TRADING

Daily Market Lookup

  • The dollar edged lower in early European trade Friday, but trading ranges have been tight as traders attempt to weigh up the conflicting forces of a continued economic recovery with heightened tensions over China’s move to tighten control over Hong Kong. German retail sales fell at their fastest pace since 2007 in April, data showed on Friday, but the drop - at 5.3% on the month - was not as steep as expected in a sign of the relative resilience of Europe's largest economy during the coronavirus crisis. March's figures were also revised to reflect a gentler decline. While in the U.S., Thursday’s initial jobless claims data showed that more than two million Americans filed for unemployment benefits for the first time last week. This is another horrendous figure, but the weekly totals have continued to fall since hitting a peak of 6.8 million in late March. At the moment the foreign exchange markets are holding their breath ahead of U.S. President Donald Trump’s statement in response to China parliament’s passing of an anti-sedition law relating to Hong Kong. The euro has continued to strengthen Friday, driven by increased confidence in the global economy but also by EU institutions starting to agree that an accommodative stance is indeed needed, especially in terms of fiscal policy. The dollar ended the week with gains in Asia, with U.S.-China tensions nearing a boiling point. Tensions have been simmering throughout the week, triggered by China’s national security laws for Hong Kong and Macau during the previous week. China’s National People’s Congress approved the enactment of the law in Hong Kong on Thursday. U.S. President Donald Trump will announce his response to the approval at a press conference later in the day.
  • The dollar edged lower in early European trade Friday, but trading ranges have been tight as traders attempt to weigh up the conflicting forces of a continued economic recovery with heightened tensions over China’s move to tighten control over Hong Kong. German retail sales fell at their fastest pace since 2007 in April, data showed on Friday, but the drop - at 5.3% on the month - was not as steep as expected in a sign of the relative resilience of Europe's largest economy during the coronavirus crisis. March's figures were also revised to reflect a gentler decline. While in the U.S., Thursday’s initial jobless claims data showed that more than two million Americans filed for unemployment benefits for the first time last week. This is another horrendous figure, but the weekly totals have continued to fall since hitting a peak of 6.8 million in late March. At the moment the foreign exchange markets are holding their breath ahead of U.S. President Donald Trump’s statement in response to China parliament’s passing of an anti-sedition law relating to Hong Kong. The euro has continued to strengthen Friday, driven by increased confidence in the global economy but also by EU institutions starting to agree that an accommodative stance is indeed needed, especially in terms of fiscal policy.
  • Oil was down on Friday morning in Asia, giving up some of its gains from the previous session. Investor sentiment soured due to mounting U.S.-China tensions after China’s National People’s Congress passed a draft decision to enact national security law laws in Hong Kong on Thursday. U.S. President Donald Trump will unveil his response to the laws at a press conference on Friday. Potential U.S. actions could include trade sanctions, which would impact the demand that has slowly been recovering from the lockdowns. Demand recovery will also be compounded by some countries continuing to report new second-wave outbreaks, with the number of global COVID-19 cases approaching 6 million. Investors will be also looking to the decisions made during OPEC’s June meeting in less than two weeks to see whether Russia agrees to continue cuts in production until the end of the year. Meanwhile, the U.S. Energy Information Administration (EIA) announced on Thursday a surprise build of 7.928 million barrel for the week ending May 22. Analyst forecasts prepared by Investing.com predicted a 1.944 million-barrel draw. EIA's estimates followed the American Petroleum Institute (API)’s estimate of an 8.7 million-barrel build earlier in the week. Oil prices edged lower on Friday after U.S. inventory data showed lacklustre fuel demand in the world's largest oil consumer while worsening U.S.-China tensions weighed on global financial markets. Thursday's data from the Energy Information Administration showed that U.S. crude oil and distillate inventories rose sharply last week. Fuel demand remained slack even as various states lifted travel restrictions they had imposed to curb the coronavirus pandemic, analysts said. Looking ahead, traders will be focusing on the outcome of talks on output cuts between members of OPEC+, the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, in the second week of June. Saudi Arabia and some OPEC members are considering extending record production cuts of 9.7 million barrels per day beyond June, but have yet to win support from Russia.

 

 
Intraday RESISTANCE LEVELS
29th May 2020 R1 R2 R3
GOLD-XAU 1,720-1,740 1,748 1,755-1,765
Silver-XAG 17.60-18.00 18.40 18.95-19.50
Crude Oil 34.00-35.20 36.00 36.60-37.10
EURO/USD 1.1030-1.1060 1.1150 1.1200-1.1235
GBP/USD 1.2410 1.2470 1.2500-1.2550
USD/JPY 107.90-108.40 109.40 110.20-111.00

Intraday SUPPORTS LEVELS
29th May 2020 S1 S2 S3
GOLD-XAU 1,709-1,700 1,690 1,675-1,660
Silver-XAG 16.90-16.50 16.10 15.60-15.20
Crude Oil 32.90-32.05 31.00 30.50-29.00
EURO/USD 1.0970-1.0900 1.0800 1.0750-1.0700
GBP/USD 1.2320--1.2250 1.2165 1.2100-1.2060
USD/JPY 107.10-106.20 105.60 105.00-104.30

Intra-Day Strategy (29th May 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 Thursday made its intraday high of US$1727.47/oz and low of US$1705.53/oz. Gold down 0.636% at US$1718.36/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 1709-1660 with risk below 1660, targeting 1720-1740 and 1748-1754. Sell below 1709-1760 keeping stop loss closing above 1760, targeting 1700-1690 and 1674-1660.

 
Intraday Support Levels
S1     1,709-1,700
S2     1,690
S3     1,675-1,660
Intraday Resistance Levels
R1     1,720-1,740
R2     1,748
R3     1,755-1,765

Technical Indicators

Name   Value Action
14DRSI  

52.982

Buy
20-DMA   1717.47 Buy
50-DMA  

1678.93

Buy
100-DMA   1632.40 Buy
200-DMA   1563.70 Buy
STOCH(5,3)   28.621 Sell
MACD(12,26,9)   -2.894 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$17.50/oz and low of US$17.15/oz settled up by 0.440% at US$17.32/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 16.90-15.00 targeting 17.60-18.00 and 18.40-18.95; stop breakage below 15.00. Sell below 17.60-18.95 with stop loss above 18.50; targeting 16.90-16.50-16.10 and 15.60-14.40.

 
Intraday  Support Levels
S1     16.90-16.50
S2     16.10
S3     15.60-15.20

Intraday  Resistance Levels
R1     17.60-18.00
R2     18.40
R3     18.95-19.50

TECHNICAL INDICATORS
Name   Value Action
14DRSI   75.370 Buy
20-DMA   15.36 Sell
50-DMA   14.88 Sell
100-DMA   16.35 Sell
200-DMA   16.91 Sell
STOCH(5,3)   96.268 Buy
MACD(12,26,9)   -0.374 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US34.24/bbl, intraday low of US$31.13/bbl and settled up by 4.75% to close at US$33.65/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 32.00-27.70 with risk daily closing below 27.70 and targeting 33.00-35.20-36.00 and 36.60-37.10-37.70. Sell in between 33.20-37.70 with stop loss at 37.70; targeting 33.00-32.25-31.00 and 30.50-29.90-28.40-27.70.

 
Intraday Support Levels
S1     32.90-32.05
S2     31.00
S3     30.50-29.00

Intraday Resistance Levels
R1     34.00-35.20
R2     36.00
R3     36.60-37.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   64.117 Sell
20-DMA   22.13 Buy
50-DMA   24.89 Sell
100-DMA   38.40 Sell
200-DMA   47.45 Sell
STOCH(5,3)   82.130 Sell
MACD(12,26,9)   -3.0720 Sell

EUR/USD

AAFX TRADING

EUR/USD on Monday an intraday low of US$1.0991/EUR, high of US$1.1030/EUR and settled the day up by 0.722% to close at US$1.1075/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 1.0970-1.0630 with risk below 1.0630, targeting 1.0970-1.1030 and 1.1060-1.1150. Sell below 1.0970-1.1150 targeting 1.0900-1.0820-1.0770-1.0700 and 1.0630-1.0570 with stop-loss at daily closing above 1.1100.

 
Intraday Support Levels
S1     1.0970-1.0900
S2     1.0800
S3     1.0750-1.0700

Intraday  Resistance Levels
R1     1.1030-1.1060
R2     1.1150
R3     1.1200-1.1235

TECHNICAL INDICATORS
Name   Value Action
14DRSI   44.032 Buy
20-DMA   1.0851 Buy
50-DMA   1.0897 Buy
100-DMA   1.0970 Sell
200-DMA   1.1015 Sell
STOCH(5,3)   78.758 Buy
MACD(12,26,9)   -0.0047 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2232/GBP, high of US$1.2343/GBP and settled the day up by 0.72% to close at US$1.2317/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

Based on the charts and explanations above; sell below 1.2410-1.2550 with targets at 1.2320-1.2250-1.2165 and 1.2100-1.2060 stop-loss should be below 1.2470. Buy above 1.2060-1.1900 with targets 1.2165-1.2210-1.2320 and 1.2410-1.2470-1.2500 with stop loss closing below 1.2100.

 
Intraday Support Levels
S1     1.2320--1.2250
S2     1.2165
S3     1.2100-1.2060

Intraday Resistance Levels
R1     1.2410
R2     1.2470
R3     1.2500-1.2550

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

47.554

Buy
20-DMA   1.2308 Buy
50-DMA   1.2270 Sell
100-DMA   1.2600 Sell
200-DMA   1.2650 Sell
STOCH(5,3)   44.940 Sell
MACD(12,26,9)   -0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Friday made intra‐day low of JPY107.56/USD and made an intraday high of JPY107.89/USD and settled the day down by 0.077% at JPY107.61/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 107.90-110.50 with risk above 110.50 targeting 106.90-106.20-105.60 and 105.00-104.30. 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     107.10-106.20
S2     105.60
S3     105.00-104.30

INTRADAY RESISTANCE LEVELS
R1     107.90-108.40
R2     109.40
R3     110.20-111.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   47.904 Buy
20-DMA   107.10 Buy
50-DMA   107.55 Sell
100-DMA   108.51 Sell
200-DMA   108.22 Buy
STOCH(9,6)   70.253 Sell
MACD(12,26,9)   -0.161 Sell

AAFX TRADING
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