Equities remain bid & USD weaker

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Daily Outlook – 12 Oct. 2020

By: Stuart Cowell

Equities remain bid & USD weaker on hopes of the stimulus package – Trump ups offer to $1.6 tln. Chinese move to weaken Yuan, JPY Machine orders & NZ visitor numbers both much better than expected. EU talking tough as EU_UK Trade negotiations into end game phase- new virus restrictions in Spain, France, and the UK. EU follows the US on new rules for big tech. Research from Australia suggests CIVID can last up to 28 days on Glass, Stainless Steel & Bank Notes. US Bond & FED markets closed today – Equities markets open – CAD also closed today.

The week ahead – EU Council meeting, Q3 Earnings Season kicks-off, and Inflation week.

USDIndex – tested under 93.00 before close Friday – back to 93.06 (s1) now. PP 93.30, S2 92.0

EUR – closed at 15-day high Friday – 1.1823. back to 1.1817 now – PP 1.1805, R1 1.1852, s1 1.1775

JPY – under 105.50 again.; trades at 105.44 (S1) – S1 105.95

GBP – closed on 1.3000 Friday, now 1.3050 – over S2 – deal (BOE ask Banks to prepare for possible zero/ neg. rates).

AUD – holds over 0.7200 (PP) – trades at 0.7225 – R1 0.7240, s1 0.71 76

NZD – holds over 0.6600 – trades at 0.6660 (r1 .6675) – Possible Ardern whitewash at Gen Election (Oct 17)

CAD – tested into 1.3100 on Friday – now at 1.3125. S1 1.3117, PP 1.3155, S2 1.3092

CHF – tested under 0.9100 to 0.9090 on Friday – now at 0.9100. pp 0.9120, S1 0.9066, R1 0.9146

BTC – broke & breached 11,000 Friday – gapped at open to 11,350

GOLD – up to 1929 on close Friday. Now 1928, PP 1918, R1 1942. USOil – slipped from $41.40 high Friday to $40.15 now (Hurricane Delta only Cat. 2 – more production back on sooner)

USA500 – closed +30.31 (0.88%) at 3477, Futs. now at 3490. 50-day MA 3390

Today – ECB’s Lagarde, de Guindos, Schnabel, Panetta, BoE’s Bailey, Haskel, and US Columbus Day Holiday (cash Treasuries closed)

Biggest (FX) Mover @ (06:30 GMT) GBPAUD (+0.34%) – Held break of 1.8000 into close Friday. Broke 50 & 200 MA this morning (1.8040). Fast MA’s still aligned higher, RSI 60 and moving higher, MACD histogram & signal line aligned higher and over 0-line. Stochastics into OB zone. H1 ATR 0.0020, Daily ATR 0.0150.


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