Risk-Off and USD rally

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Daily News – 16 April 2020

By: Stuart Cowell


Risk-Off USD rally following woeful US data and weak earnings. Equities down 2%,
Treasuries up and even Gold n JPY slipped. Oil remains moribund with NZD & AUD hit hardest – BOC offered more stimulus, APPLE launched a $399 iPhone and the FED’s balance sheet now stands at $6.2tn.
Abe offers each citizen 100k Yen. Merkel announced some relaxations and TRUMP is to announce re-opening plans later today, with signs of the virus plateauing in the US & UK and rapid declines in Australia, New Zealand Norway and Austria. Global infections are now over 2.07 million with a death toll close to 128,000.

USD Index – rallied back to 100.00 from 98.80 9 day lows- r1 100.10 – PP 99.45
EUR – trades to 1.0882 after testing 1.0850 (s1) and a 150 pip fall yesterday.
JPY – Up to test 108.00 from 107 yesterday – trades at R1 107.90
GBP – down close to 200 pips yesterday – touched 1.2450, trades at 1.2470 – PP 1.2530, S1 1.2435
AUD ended 7 day rally – down from 0.6440 to touch 0.6275 now – PP 0.6350, S1 0.6260 – NZD – weakest overnight down to 0.5960 from 0.6100 yesterday
CAD – rallied over 200 pips from 1.3880 to 1.4120. PP 1.4040 R1 1.4185
CHF – recovered to test 0.9700 from 0.9600 – trades at 0.9660
BTC – down to rest 6500 earlier trades at 6600 now.

Gold – down from 1725 to 1718 now (pp) R1 1730, s1 1710
USOil – Inventories showed a 19 million barrel build – 60% more than expected, and up from last week’s massive 15 million – Fell to $19.25 (s1), trades at 19.85 now (S3 17.55). PP $20.00

Equities – US500 down 2.2%, 62 pts to 2783 – GS & Citi reported weak earnings – FUTS trade back to 2800 – above 20MA but below 50MA

TODAY – Eurozone Industrial Production, US Initial Jobless Claims, Building Permits, Housing Starts, Philadelphia Fed Business Index, OPEC Monthly Oil Report, earnings from Blackrock, Morgan Stanley, L’Oreal, LVMH

Biggest (FX) Mover @ (06:00 GMT) NZDUSD (-0.45%) – fell from 0.6100 yesterday to 0.5950 overnight. Fast
MA’s aligned lower, RSI 39 and falling, MACD histogram & signal line aligned lower, Stochastics move into OS
zone and recovering. H1 ATR 0.0018, Daily ATR 0.0090.


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