AAFX TRADING

Daily Market Lookup

  • The dollar held firm against many of its rivals on Wednesday after U.S. retail sales jumped far more than expected in May, while risk-sensitive currencies were hobbled by concerns about the coronavirus and geopolitical tensions in Asia. Federal Reserve chairman Jerome Powell also doused some of the rosy expectations on Tuesday, as he painted a rather bleak picture of the U.S. economy while also cementing market hopes for continued policy support. Tuesday's data showed U.S. retail sales jumping 17.7% last month, outstripping economists' median forecast of 8.0% increase. The surge in retail sales last month recouped 63% of March and April's decreases, raising hopes of a quick recovery in the consumption, the driver of the U.S. economy. Still, Fed chairman Powell had a word of caution in his testimony at Congress, saying output and employment would remain well short of their pre-pandemic levels for a long time, so there was a "reasonable probability" that more policy support would be needed. Powell added that a full U.S. economic recovery will not occur until the American people are sure that the novel coronavirus epidemic has been brought under control. That still remains far from certain, with new coronavirus infections hitting record highs in six U.S. states, including populous Texas and Florida, on Tuesday China also sharply ramped up restrictions on people leaving the capital on Tuesday in an effort to stop the most serious coronavirus flare-up since February from spreading to other cities and provinces. The dollar was up on Wednesday morning in Asia, boosted by fears over rising numbers of COVID-19 cases and geopolitical tension. In China, the government is dealing with a surging second wave of COVID-19 cases stemming from a weekend outbreak at the Xinfadi market. The government closed schools in the city and upped its emergency level to level two on Wednesday. China is also dealing with rising tensions with India, with clashes between India and China at a disputed border site leaving 20 Indian soldiers dead as well as an unspecified number of Chinese casualties. In other parts of Asia, tensions between North and South Korea also intensified after North Korea blew up a joint liaison office on Tuesday and threatened to send troops to the DMZ. Meanwhile, U.S. Federal Reserve Chairman Jerome Powell upheld a gloomy picture of U.S. economic recovery from COVID-19 on Tuesday, pouring cold water on optimism for a quick recovery.
  • Oil prices fell on Wednesday as data showed an increase in U.S. crude and fuel inventories, raising the prospect of oversupply as a potential second wave of the coronavirus pandemic threatened to halt any recovery of demand. Both benchmarks rose more than 3% on Tuesday, after the International Energy Agency (IEA) raised its 2020 oil demand forecast to 91.7 million barrels per day (bpd) and U.S. retail sales posted a record jump in May. The rise in U.S. crude and fuel inventories, however, stoked concerns about a surplus and pressured oil prices, as the number of coronavirus infections surpassed 8 million globally and several U.S. states saw their case numbers spike. U.S. crude oil inventories rose by 3.9 million barrels in the week to June 12 to 543.2 million barrels, according to data from industry group the American Petroleum Institute, countering expectations for a fall of 152,000 barrels. Gasoline stocks rose by 4.3 million barrels and distillate fuels, which include diesel and heating oil, rose 919,000 barrels. Official data from the U.S. Department of Energy's Energy Information Administration is due later on Wednesday. An OPEC-led panel will meet on Thursday to further discuss ways to strengthen and review compliance with producers' commitment to curb oil output. Iraq reduced its oil exports by 8%, or 300,000 bpd, so far in June, indicating OPEC's second-largest producer is stepping up efforts to adhere to its pledged cut. The Organization of the Petroleum Exporting Countries (OPEC) and its allies, collectively known as OPEC+, agreed to cut output by 9.7 million bpd - about 10% of pre-pandemic demand - to the end of July. Oil was down on Wednesday after the American Petroleum Institute (API) predicted a second consecutive week of increases in the crude oil supply. But the black liquid retreated after the API forecast amid renewed oversupply supplies. Investor sentiment was further damped with a rising second wave of cases in Beijing and parts of the U.S. threatening the already-fragile demand Meanwhile, all eyes will be on the U.S. Energy Information Administration supply forecast due later in the day, as well as on the results of the OPEC-led monitoring panel on Thursday. The panel will review compliance with OPEC’s pledged production cuts, in place until the end of July, and look at ways to support prices.

 

 
Intraday RESISTANCE LEVELS
17th June 2020 R1 R2 R3
GOLD-XAU 1,740-1,748 1,754 1,760-1,770
Silver-XAG 18.00-18.55 18.95 19.60-20.10
Crude Oil 38.90-39.50 40.50 41.00-42.00
EURO/USD 1.1300-1.1360 1.1400 1.1450-1.1500
GBP/USD 1.2600 1.2650 1.2720-1.2800
USD/JPY 107.90 108.40 109.40-110.20

Intraday SUPPORTS LEVELS
17th June 2020 S1 S2 S3
GOLD-XAU 1,720-1,704 1,690 1,675-1,664
Silver-XAG 17.25-16.90 16.30 16.00-15.55
Crude Oil 38.00-37.10 36.00 34.90-33.90
EURO/USD 1.1260-1.1235 1.1150 1.1090-1.1030
GBP/USD 1.2550-1.2470 1.2410 1.2320-1.2240
USD/JPY 107.10-106.50 105.50 105.00-104.30

Intra-Day Strategy (17th June 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 Tuesday made its intraday high of US$1732.69/oz and low of US$1716.38/oz. Gold up 0.188% at US$1725.99/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1642) and breakage below will call for 1600. MACD is above zero line and histograms are also increasing trend and it will bring upward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold 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 1720-1670 with risk below 1670, targeting 1740-1748 and 1654-1660. Sell below 1740-1770 keeping stop loss closing above 1770, targeting 1729-1704-1690 and 1674-1664.

 
Intraday Support Levels
S1     1,720-1,704
S2     1,690
S3     1,675-1,664
Intraday Resistance Levels
R1     1,740-1,748
R2     1,754
R3     1,760-1,770

Technical Indicators

Name   Value Action
14DRSI  

55.982

Buy
20-DMA   1723.18 Sell
50-DMA  

1705.61

Sell
100-DMA   1648.90 Buy
200-DMA   1573.51 Buy
STOCH(5,3)   87.621 Sell
MACD(12,26,9)   4.894 Sell

Silver - XAG

AAFX TRADING

Silver on Tuesday made its intraday high of US$17.56/oz and low of US$17.26/oz settled up by 0.449% at US$17.43/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 200DMA (16.93), breakage below will lead to 16.30. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is approaching 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 17.00-15.55 targeting 18.00-18.40-18.95 and 19.60-20.10; stop breakage below 15.00. Sell below 18.00-20.10 with stop loss above 20.10; targeting 16.90-16.50-16.10 and 15.80-15.40.

 
Intraday  Support Levels
S1     17.25-16.90
S2     16.30
S3     16.00-15.55

Intraday  Resistance Levels
R1     18.00-18.55
R2     18.95
R3     19.60-20.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.514 Buy
20-DMA   17.52 Buy
50-DMA   16.24 Buy
100-DMA   16.25 Buy
200-DMA   16.89 Buy
STOCH(5,3)   29.268 Sell
MACD(12,26,9)   -0.541 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Tuesday made an intra‐day high of US39.29/bbl, intraday low of US$36.60/bbl and settled up by 2.065% to close at US$38.05/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 38.10-34.00 with risk daily closing below 34.00 and targeting 38.90-39.50-40.10 and 41.00-42.00. Sell in between 38.90-42.10 with stop loss at 42.10; targeting 38.00-37.10-36.00 and 34.90-33.90-33.00.

 
Intraday Support Levels
S1     38.00-37.10
S2     36.00
S3     34.90-33.90

Intraday Resistance Levels
R1     38.90-39.50
R2     40.50
R3     41.00-42.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.03 Sell
20-DMA   36.25 Buy
50-DMA   28.91 Buy
100-DMA   34.39 Buy
200-DMA   45.77 Sell
STOCH(5,3)   64.130 Buy
MACD(12,26,9)   2.453 Sell

EUR/USD

AAFX TRADING

EUR/USD on Tuesday an intraday low of US$1.1227/EUR, high of US$1.1352/EUR and settled the day down by 0.525% to close at US$1.1262/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 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 1.1260-1.1030 with risk below 1.1030, targeting 1.1300-1.1360-1.14001.1450 and 1.1495-1.1550. Sell below 1.13-1.1495 targeting 1.1235-1.1190-1.1150 and 1.1090-1.1020 with stop-loss at daily closing above 1.1500.

 
Intraday Support Levels
S1     1.1260-1.1235
S2     1.1150
S3     1.1090-1.1030

Intraday  Resistance Levels
R1     1.1300-1.1360
R2     1.1400
R3     1.1450-1.1500

TECHNICAL INDICATORS
Name   Value Action
14DRSI   60.032 Buy
20-DMA   1.1173 Buy
50-DMA   1.0991 Buy
100-DMA   1.0982 Sell
200-DMA   1.1024 Sell
STOCH(5,3)   36.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Tuesday made an intra‐day low of US$1.2551/GBP, high of US$1.2686/GBP and settled the day down by 0.267% to close at US$1.2570/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 1.2600-1.2900 with targets at 1.2550-1.2470-1.2410 and 1.2320-1.2250-1.2165 stop-loss should be 1.2900. Buy above 1.2550-1.2200 with targets 1.2650-1.2700 and 1.2770 -1.2800-1.2850 with stop loss closing below 1.2200.

 
Intraday Support Levels
S1     1.2550-1.2470
S2     1.2410
S3     1.2320-1.2240

Intraday Resistance Levels
R1     1.2600
R2     1.2650
R3     1.2720-1.2800

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

55.554

Buy
20-DMA   1.2488 Buy
50-DMA   1.2424 Buy
100-DMA   1.2521 Sell
200-DMA   1.2677 Sell
STOCH(5,3)   37.940 Sell
MACD(12,26,9)   -0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Tuesday made intra‐day low of JPY107.20/USD and made an intraday high of JPY107.63/USD and settled the day down by 0.0167% at JPY107.31/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 107.50-111.00 with risk above 111.00 targeting 106.90-106.20-105.60 and 105.00-104.50. Long positions above 106.90-104.00 with targets of 107.90-108.40 and 109.40-110.20-110.90 with stop below 105.00.

 
Intraday Support Levels
S1     107.10-106.50
S2     105.50
S3     105.00-104.30

INTRADAY RESISTANCE LEVELS
R1     107.90
R2     108.40
R3     109.40-110.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.904 Buy
20-DMA   107.85 Buy
50-DMA   107.53 Sell
100-DMA   108.13 Sell
200-DMA   108.41 Buy
STOCH(9,6)   37.253 Sell
MACD(12,26,9)   -0.161 Sell

AAFX TRADING
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