InvestMacro

By Orbex

EURJPY Bounces Off September’s Low

While markets were anticipating an aggressive move from the ECB in the wake of the rate cuts from the Fed and the BoE, Christine Lagarde surprised us all by holding fire and shifting the responsibility onto government fiscal policies. The euro saw the opportunity to take a firm stance against the Japanese yen.

This week will see the response from the Bank of Japan, and volatility is likely to increase as we expect deeper stimulus for the struggling Asian economy. A bullish reversal will need to break above 121.00. On the downside, the psychological level of 116.00 is the major support.

USDCHF Recovers Lost Ground

The US dollar rallied sharply as the market meltdown pushed investors into the most liquid currency. As the US braces for the outbreak, the Federal Reserve has pledged to provide $1.5 trillion in short-term liquidity to calm nerves.

Market participants expect the announcement of more drastic measures on Wednesday to fight off the economic fallout. Further stimulus may continue to add pressure on the Swiss franc.

The greenback is rising back to the 30-day moving average (0.9650). A stronger momentum could send the pair towards the February high of 0.9850.

GBPAUD Maintains its Uptrend

The spread of the coronavirus has overshadowed the Brexit theme. Face-to-face trade talks between the EU and Britain have been canceled as countries rush to contain the outbreak across the continent. This leaves Brexit-related volatility on the backburner, for now.

An upbeat UK jobs figure could give the pound sterling a further lead over the Australian dollar. The pair is climbing back towards the previous high of 2.0700. The bullish trend line would act as the immediate support in case of a retracement.

Gold Loses its Shine Against US Dollar

With equity markets down more than 20% from their peaks earlier this year, one would have thought that the precious metal would cushion the blow as a safe haven asset. Yet bullion failed to keep its head above $1,700 an ounce and dived $150 instead. It looks like that in times of extreme panic, investors would rather cash out and hold the mighty dollar, especially after the Fed’s massive liquidity injection.

Gold has broken below the daily support of 1560, a sign that the bullish run might have been compromised after longs took profit. If buying fails to extend beyond 1640, we may see a deeper pullback towards 1500.

By Orbex

By Orbex

The increasing severity of the ongoing coronavirus outbreak has raised serious questions over the validity of the PM’s refusal to extend the transition beyond December 31^st.

The PM has so far been adamant that the current trade talks between the UK and the EU will not be extended. And, if a deal is not in place in time, the UK is prepared to walk away without one.

Johnson Warns Over Trade Talks Progress

Last month, the UK government published its guidelines for trade talks.

It warned the EU that if a robust outline for a deal is not outlined by June, ready to be confirmed by September, the UK is prepared to walk away from the talks ahead of the December 31^st deadline.

However, both UK and EU leaders are totally engaged in fighting the coronavirus outbreak. As a result, trade talks have had to be put on pause for now. With health authorities warning that the virus could continue to spread for months to come, the PM’s June deadline now looks inappropriate.

PM Sticking to Deadline Pledge

Commenting on the situation at the end of last week, the PM’s spokesman once again confirmed that the PM will press ahead with the December 31^st deadline saying:

“In UK law, a request for an extension is not possible”.

Commenting on how the virus is affecting the ongoing trade talks, the PM’s spokesman said:

“It will be possible to do the trade talks. Both the UK and the EU are fully aware of the timetable which we’re working towards… The discussions can take place using an alternative forum, such as video-conferencing… Video-conferencing is something which is used throughout the world, and business.”

GBP Under Pressure

GBP has been under heavy selling pressure over the last week following a surprise rate cut from the BOE. Following in the footsteps of the Fed, the BOE announced a 0.5% rate cut. This took rates down to record lows of 0.25%.

The BOE cited its concern over the economic impact of the virus outbreak as its reason for cutting and signaled that it could take further action if necessary.

Technical Perspective

Looking at GBPUSD on the monthly timeframe shows that price has been moving in a clear descending triangle pattern against the 1.1929 support level.

While the bearish trend line remains intact, a further test of this level looks highly likely, a break of which would be a long term bearish signal for GBPUSD.

By Orbex

By ForexNewsNow

It’s now been over 2 months since Coronavirus was officially announced to the global public, and since then it has been absolute chaos all around the world. Over 92,000 cases have been confirmed worldwide as of this writing, with at least 3,200 deaths. The bulk of the infected is in China, where the virus originated from, with Iran being the second.

Panic and fear have overtaken everyone’s minds, resulting in irrationality and division among people. Some of the countries have completely shut down government services like schools, universities, and kindergartens. In China, where the virus originated from, a greater part of the economy is effectively put on a halt.

Needless to say, this all will have – and already has – major effects on the global economy. Experts estimate that global economic growth will suffer by at least 0.3%; possibly way more.  China’s economy accounts for around 17% of the global GDP today, so this is to be expected. At the end of February, Dow Jones dropped by almost 1200 points, the largest single drop in history.

Companies are also feeling very apprehensive due to the virus. On their earnings calls the previous month, Coronavirus was mentioned dozens of times, pointing at the level of seriousness that these companies attribute to the matter. Giant global companies like Under Armour, Tesla and Starbucks have all reported significant drops in projected earnings, and are estimating continued drops for the foreseeable future.

Similar cases have been mentioned in the crypto industry as well. Due to everybody expecting COVID-19 to cause a serious rise in Bitcoin’s valuation due to the distrust of the traditional stock market, thousands of traders started to hodl all of their assets. However, there were some very weird cases of traders starting to sell off their portfolio in anticipation of a big drop due to the virus which was considered quite foreign. However, according to Bitcoin Revolution, an AI trading robot company, their customer base for some reason started to immediately deactivate their accounts in order to prevent anymore scalping. Needless to say, those traders were right as BTC plummeted all the way down to $3,400. However, now that the coin is down, it’s like the crypto industry is reviving itself once again, thousands of traders have contacted Bitcoin Revolution in order to get started now as information was spread about the decision beforehand.

This “revival” has also shown us some strange anomalies with crypto as well.

Economic Anomalies from Coronavirus

With such a hectic turn of events all around the world, it didn’t take too long for some extraordinary and bizarre economic events to take place. One such example is Coronacoin – a cryptocurrency that was recently developed by programmers from the 4Chan community. It tracks and monitors all the cases and deaths from COVID-19 over the globe and adjusts its value accordingly. According to the coin’s website, the currency’s supply is based on the total population of the world, and a token is burned once every 48 hours, based on the infections + fatalities.

As the fatalities increase from the virus, the coin’s amount decreases, thus increasing in value. The situation is quite extraordinary, to the point of seeming like a satire. Some members of the community have made some bizarre posts titled “bet on the coronavirus pandemic by investing in this coin. The further it spreads, the more valuable it becomes”.

The company behind the coin proudly boasts that it’s the first crypto that is backed by proof of death. The developers of the currency claim that it offers an interesting and unique way to track and monitor the spread of the virus.

The endeavor was met with a mixed bag of reactions. Naturally, some of the people have opposed it vehemently, stating that the team should be ashamed for “playing on people’s lives”, while others are thankful for any opportunity to bring awareness to the virus. The virus is spreading fast, and some argue that the media is not doing enough to bring as much awareness to it as needed, and this can be of help.

Whatever the people may be thinking, according to Sunny Kemp, one of the developers behind this, the project is, at least to some extent, altruistic; as the parts of the earnings will be going towards charity. To be exact, 20 percent of the total amount of the coin will be donated towards the Red Cross. According to Kemp, their goal is to increase awareness of the virus and help fight it. Kemp added, that they’re in talks with a biochemist who’s currently working on a cure of the virus.

By ForexNewsNow

By Orbex

For the oil market, it is not just about the coronavirus hampering demand, but also about the tit for tat between Saudi Arabia and Russia.

Technically, crude oil shows room for a drop towards the $21-22 handle (see highlighted area above). This is based on the longer-term projection as the weekly chart indicates.

In the shorter term and as seen above, we are looking for a move back to the $27.15-20, with $28.25 as an initial resting point.

The 30-minute chart indicates that prices have broken below a bear flag pattern. This breakout was confirmed with a retest and a failure t the $34 round resistance (see highlighted area).

This was followed by another bear flag and prices fell through to deeper levels. This is often seen when we notice consequent flag breakouts.

Out technical view favors additional weakness with the $30.35 looking to provide a short-term resistance. Provided of course a retracement takes place.

Otherwise, the next level on the downside is marking the $27.15-20 area, which looks like an interim target on the 30 minutes timeframe. The initial support could kick in around $28.25.

By Orbex

By CentralBankNews.info
Kazakhstan’s central bank left is base rate steady at 12.0 percent, saying it considers a significant deterioration in the prospects for the global economy, lower demand and increased volatility in commodity markets “a new economic reality,” and global growth in 2020 may be the worst since 2008.
The National Bank of Kazakhstan (NBK) said its unscheduled 200 basis point rate hike on March 10 helped lower the spread of panic in financial markets and limit the emerging risks to inflation and protect the value of assets in the tenge currency.
At the same time, its decision to widen the interest rate corridor to 1.5 percentage points on either side of the rate had eased speculative pressure on the exchange rate and raised the cost of tenge borrowing by banks to 13.5 percent.
On top of the outbreak of the coronavirus, oil prices plunged on March 9 following the failure of OPEC-plus, which includes the non-OPEC nations of Russia, Kazakhstan and Mexico, to reach an agreement, hitting Kazakhstan’s tenge hard.
Oil accounts for some 75 percent of Kazakhstan’s exports and around one-third of its gross domestic product.
Last week’s unscheduled rate hike was aimed at maintaining price stability, and NBK said it remains committed to a floating exchange rate regime as part of its inflation targeting policy framework.
This policy is also aimed at reducing the impact of external shocks on the country’s economy, ensure macroeconomic stability and protect tenge assets.
However, if necessary the central bank said it will also carry out interventions to stabilize the financial system and between March 10 and March 13 NBK intervened to absorb some of the negative impact on the exchange rate from the change in external conditions.
From March 6 to March 13 the value of the tenge fell 6.1 percent to 405.62 tenge per dollar, NBK said.
Today the tenge was stable around 406.5 to the dollar, down 7.5 percent since a 2020 high on Feb. 24 and down 6.3 percent since the start of this year.
The unfolding price war between Russia and Saudi Arabia has led to a 50 percent collapse in crude oil prices since the start of this year, hitting the currencies of oil-exporting nations.
NBK has revised its forecast for Brent crude to $35 per barrel from $60 and based on the new realities of the global economy there is an increased risk that inflation may exceed its upper limit of its target corridor in 2020.
NBK targets inflation of 4-6 percent and in February inflation rose to 6.0 percent from 5.6 percent.
The central bank said it reserved the right to continue to smooth out fluctuations in financial markets, including the foreign exchange markets, that threaten price and financial stability and was ready to adopt additional measures if the global economy worsens.

www.CentralBankNews.info

By IFCMarkets

The actions of the global central banks reduced the attractiveness of precious metals

The ECB approved a range of financial measures to support the European economy. The US Federal Reserve will provide $ 1.5 trillion of short-term loans to US companies and banks. Similar measures were taken by the Central Bank of Australia, England and other countries. All of this can reduce the risks of a global economic downturn. Against this background, palladium quotes fell by 24% over the week, platinum and silver – by 12%. Gold is still behind and fell by 8%.

Summary of technical analysis

Market Analysis provided by IFCMarkets

By Dmitriy Gurkovskiy, Chief Analyst at RoboForex

On Monday morning, EUR/USD is slowly growing and trading close to 1.1130.

The US Federal Reserve cuts the benchmark rate for the second time this month, down to 0%-0.25%. The meeting where the regulator made the rate decision was unscheduled again, as the scheduled meeting is set for this week. For market players, the rate decision may act as a signal that possible consequences of the coronavirus world-wide transmission might be much more serious than meets the eye.

In the comments that followed the regulator said that the coronavirus pandemic had already done appreciable damage to global economies, including the USA. The virus consequences may have an influence on economic outlook and activity, that’s’ why the rate was cut.

The regulator is planning to keep the rate low up until the moment it is completely sure that the worst aspects of the outbreak are behind.

US President Donald Trump was very enthusiastic about the news and said that it was good for the country’s economy.

As we can see in the H4 chart, after breaking the rising channel and reaching 1.1106, EUR/USD is still moving downwards. If the price resumes growing and rebounds from 1.1212, the downtrend may continue towards 1.0950. However, if the price grows and breaks 1.1212 to the upside once again, it may continue trading upwards to reach 1.1300. From the technical point of view, the “decline” scenario is confirmed by MACD Oscillator: its signal line is moving below 0 inside the histogram area soon, thus indicating a further downtrend.

In the H1 chart, EUR/USD is growing to reach 1.1212 and may later fall towards 1.1127, thus forming a wide consolidation range around 1.1127 with equal chances of continuing either the correction or the downtrend. If the price rebounds from 1.1127 and breaks 1.1212, the correction will continue to reach 1.3000. However, if the price breaks 1.1127 to the downside, the instrument may fall to break 1.1050 as well and then continue moving downwards with the target at 1.0950. From the technical point of view, this scenario is confirmed by Stochastic Oscillator: its signal line is moving above 80 and may soon reverse towards 50. Later, this level may also be broken, thus resulting in further decline.

Disclaimer

Any predictions contained herein are based on the authors’ particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.

Article By RoboForex.com

XAUUSD, “Gold vs US Dollar”

As we can see in the daily chart, the divergence made the pair reverse to the downside after reaching 76.0% fibo at 1708.10. Right now, XAUUSD is getting closer to 38.2% fibo at 1496.50, which is a long-term support level not far from 50.0% fibo at 1482.50. After reaching and breaking this area, the price may continue falling towards 50.0% and 61.8% fibo at 1431.95 and 1367.80 respectively. The resistance is the high at 1703.17.

In the H1 chart, there was a local convergence that made the pair start a rising pullback, which has almost reached 38.2% fibo at 1580.40 and may later continue towards 50.05% fibo at 1604.05. If the price breaks the low at 1504.30, the mid-term decline may continue.

USDCHF, “US Dollar vs Swiss Franc”

As we can see in the weekly chart, the divergence made the pair start a long-term bearish trend, which is heading towards 38.2% and 50.0% fibo at 0.9093 and 0.8708 respectively. The resistance is the high at 1.0344.

In the H4 chart, after forming a quick descending wave and trying to reach 38.2% fibo at 0.9093, the pair is correcting and has already reached 50.0% fibo. Later, the pair may grow towards 61.8% at 0.9593. After completing the pullback, the instrument is expected to resume falling towards the low at 0.9176 or even deeper.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

By George Prior

The recovery from a coronavirus-triggered recession will usher in a new era in which how we live, do business and invest will fundamentally change, affirms the CEO of one of the world’s largest independent financial advisory organisations.

The comments from Nigel Green, the chief executive and founder of deVere Group, come as consensus grows that a temporary world recession is imminent and as governments and central banks scramble to try and limit the impact.

On Sunday, the U.S. Federal Reserve announced another interest rate cut on Sunday – its second emergency measure this month.

Mr Green says: “Any way you look at it, it’s now almost certain that there will be a coronavirus-triggered recession as both global supply and demand are impacted.

“We can expect this recession to be deep but short. The slowdown will be temporary because it’s not caused by deep-rooted problems and imbalances in the economy, rather by a wholly unexpected shock that’s gripped the world.”

He continues: “Every recession produces a new world. This one will too.

“A Covid-19 recession is likely to fundamentally shift how we live, do business and invest.

“We’re moving towards an era of negative interest rates. The second cut of rates, now at zero, by the Federal Reserve – the world’s de facto central bank – suggests that the U.S. could soon join peers in Europe and Japan by adopting negative interest rates.

“Zero or negative rates will help boost financial asset prices and savvy investors will be seeking to top-up their portfolios by drip-feeding new money into the market at this time. They will give more investors more reason to increase their exposure to equities as the money won’t be working for them as cash deposits.”

Mr Green goes on to say: “The coronavirus outbreak can be expected to speed up the so-called Fourth Revolution, which is fuelled by new technologies, such as Artificial Intelligence and mobile supercomputing.

“New industries will emerge and, of course, there will be winners and losers.  This will mean job losses in some sectors and huge, possibly unprecedented, job and investment opportunities in others.

“Enforced social distancing will highlight how families, friends and colleagues can interact, remain connected and work, how businesses can still efficiently operate, and how investors can manage assets via advancing digital infrastructures.”

The deVere CEO concludes: “The disruption and shifts will underscore that we live in a time of great capabilities and great promise.

“But to build and protect their wealth as the world adapts to a new era, investors should be revising their portfolios to mitigate risk and take advantage of the opportunities.”

About:

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.  It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.

Article By RoboForex.com

EURUSD, “Euro vs US Dollar”

EURUSD is consolidating around 1.1127. Today, the pair may continue falling towards 1.1040 and then form one more ascending structure to return to 1.1127. After that, the instrument may resume trading downwards with the target at 1.0955.

GBPUSD, “Great Britain Pound vs US Dollar”

GBPUSD continues falling with the target at 1.2282. Today, the pair may consolidate around 1.2302. Possibly, the price may form one more ascending structure towards 1.2460 and then start a new decline to reach 1.2182. Later, the market may return to 1.2460 and then resume trading downwards with the target at 1.1960.

USDCHF, “US Dollar vs Swiss Franc”

USDCHF is forming the ascending wave towards 0.9578. Later, the market may form a new descending structure to reach 0.9445 and then start another growth with the target at 0.9680.

USDJPY, “US Dollar vs Japanese Yen”

After completing the ascending wave at 108.49, USDJPY has finished the correction towards 105.89. Today, the pair may continue growing to reach 108.70. After that, the instrument may start a new correction to return to 105.89 and then resume trading upwards with the target at 110.50.

AUDUSD, “Australian Dollar vs US Dollar”

AUDUSD continues falling with the target at 0.6057. After that, the instrument may start a new correction towards 0.6303.

USDRUB, “US Dollar vs Russian Ruble”

USDRUB has finished the descending structure to reach 72.08. Possibly, today the pair may correct towards 74.02 and even return to 75.45. Later, the market may start another decline to break 72.10 and then continue trading downwards with the short-term target at 69.20.

USDCAD, “US Dollar vs Canadian Dollar”

USDCAD is forming a wide consolidation range around 1.3853. Today, the pair may grow towards 1.4037 and then start a new decline to reach 1.3855. After that, the instrument may resume trading upwards with the short-term target at 1.4100.

XAUUSD, “Gold vs US Dollar”

Gold continues falling; it has almost broken the ascending channel and reached 1504.25. Possibly, today the pair may correct towards 1580.30 and then form a new descending structure to reach 1461.40. After that, the instrument may start a new growth with the target at 1580.30.

BRENT

Brent continues falling; right now, it is consolidating above 32.00. According to the main scenario, the price is expected to break the range to the downside and fall to reach 27.80. Later, the market may grow to test 31.90 from below and then resume trading downwards with the first target at 25.05.

BTCUSD, “Bitcoin vs US Dollar”

After failing to break 5900.00 and rebounding from this level to the downside, BTCUSD is consolidating around 5400.00 and trying to start a new decline towards 4800.00. If later the price breaks this level, the pair may form a new descending structure with the target at 3700.00.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.