Gold prices hit fresh record highs, with London prices rising 1.7% to $1,935.90 a troy ounce and New York prices climbing 1.8% to $1,930.80 a troy ounce. Ahead of the Federal Reserve’s interest rate announcement later this week, the U.S. dollar is weakening thanks to what some Nordea Investments’ Sebastian Galy calls a “W-shaped” economic recovery in the U.S.. The WSJ Dollar Index, which tracks the dollar against a basket of other currencies, is down 0.3% on the day, having dropped 3% over the past month. ING’s Warren Patterson cites “growing safe-haven demand amid significant uncertainties, falling real yields, rising inflation expectations (rightly or wrongly), as well as momentum buying,” as all supporting gold.
Eurozone-periphery government bonds are expected to continue to outperform their safer peers, particularly German Bunds, in the coming quarters, says Oliver Jones, senior markets economist at Capital Economics. Narrow government-bond yield spreads might seem at odds with the huge increase in eurozone public debt recorded recently and the high likelihood that the bloc will experience a slow and uneven economic recovery from the coronavirus crisis, he says. However, as long as the European Central Bank’s Pandemic Emergency Purchase Programme is active, the spreads of eligible assets are more a policy choice than an expression of investors’ expectations, he says.
👉 The market mood remained tepid, in light of the worsening US-China diplomatic ties after Beijing retaliated for being ousted from the Chinese consulate in Houston. US Secretary of State Mike Pompeo called for “a new alliance of democracies” to oppose China’s “new tyranny”.
👉 On Friday, U.S. stocks sank further following the sell-off Thursday. The Dow Jones Industrial Average slid 182 points (-0.68%) to 26469, the S&P 500 fell 20 points (-0.62%) to 3215, and the Nasdaq 100 lost 97 points (-0.92%) to 10483. The Nasdaq 100 has marked two weeks of decline.
👉 Growing economic concerns amid a continued rise in the coronavirus across the US undermined the US currency. According to data compiled by Johns Hopkins University, global confirmed coronavirus infections passed 16.05 million on Sunday, with 4,178,730 in the US.
As we have observed earlier in the Currency Monitoring Chart, we discovered that CHF/JPY lines are separated with the farthest distance.
The following is EUR/CHF looking at 4 hour chart:
INTRADAY MARKET INSIGHTS
USD/JPY Intraday:
Rebound expected. The pair is off a low of 105.65 seen last Friday, and has returned to levels around the 20-period moving average. It has located a key support at 105.85 (a reaction low). Unless this level is breached, the pair is expected to rebound to 106.15 and 106.45 on the upside. Alternatively, a pull-back to 105.85 would trigger a further decline toward 105.65 on the downside.
EUR/USD Intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
AUD/USD Intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
NZD/USD intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
GBP/USD Intraday:
Currently trading at $1.2828, the British Pound is on the upside above its previous overlap at $1.2800 and is supported by its rising 50-period moving average at $1.2797. On the technical front, the 14-hour RSI remains within its buying area between 50 and 70. As a consequence, above $1.2800, further advance toward horizontal resistance at $1.2870 and toward $1.2900 is expected. A third target is set at horizontal resistance at $1.2930. Only a push below $1.2800 would turn the outlook to bearish with a first alternative target set at overlap at $1.2775 and a second one set at horizontal support at $1.2750.
USD/CHF Intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
USD/CAD Intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
EUR/JPY Intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
EUR/GBP Intraday:
Towards 1.1690. The pair keeps trading on the upside while being supported by the ascending 20-period moving average. In fact, it is shooting above the upper Bollinger band calling for acceleration toward 1.1670 and 1.1690 on the upside. The trailing key support has been raised to 1.1625 (around the 50-period moving average).
