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HFblogNews

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Date : 02nd March 2020.

Hopes of coordinated Central Banks help! 02nd March

Bonds rallied and stock markets looked somewhat better as unscheduled statements from both the BoJ and the Fed sparked speculation of coordinated global central bank cuts.

Fed Chairman Powell was already forced to issue a statement on Friday saying the bank will take appropriate action to support the economy and the BoJ followed over the weekend. The BoJ followed over the weekend, saying that it will “strive to provide ample liquidity and ensure stability in financial markets through appropriate market operations and asset purchases”. The BoJ already offered to buy 500 billion Yen of government bonds via repurchase agreements to provide liquidity and the comments and actions helped local stock markets to recover earlier losses.

A rate cut from the RBA in Australia tomorrow is now seen as pretty much a done deal and speculation that there will be a coordinated move from global central banks this week has helped bond as well as stock markets.

Stock markets had initially been under pressure this morning also due to the weak Chinese manufacturing PMI readings highlighted the impact of virus disruptions. China’s February manufacturing PMI plunged a surprising 14.3 points to 35.7, a record low. This is one of the first pieces of data reflecting the impact of COVID-19, and obviously it’s not good. This new nadir beats the prior figure of 38.8 from November 2008. It’s also the steepest drop on the books. Bloomberg cited Nomura’s chief China economist Lu Ting who noted the data might even have been worse. A rise in delivery times helped boost the index, but the longer delivery time was a function of the COVID-related shutdowns and transportation dislocations, and not due to a jump in demand. Meanwhile, the non-manufacturing index tumbled 24.5 points to 29.6 in February from 54.1 in January. It’s also the lowest on record.

However the potential of coordinated global Central Bank action have helped both Bond and Equity markets to overcome the PMI weakness. JPN225 gained 1%, while the Hang Seng lifted 0.78% and CSI 300 and Shanghai Comp rallied 3.7% and 3.4%. The GER30 and UK100 futures are up 1.4% and 1.8% respectively, while US futures are posting gains of 0.4-0.6%. In FX markets EURUSD is trading at 1.1043 and the pound is at 1.625 against the EUR and 1.2837 against the Dollar. The USDJPY lifted to 108.23, after the BoJ statement, while USOIL future traded at $46.10. Elsewhere, ECB officials have argued that it is too early to make a decision on an appropriate reaction to virus developments, but clearly with markets looking increasingly fragile central bankers will have to issue at least some assurance. German Economy Minister Altmeier meanwhile repeated that the government will address the implication of virus disruptions, saying he will discuss stimulus measures with the finance minister. Europe also has to fear another refugee crisis now after Turkey “opened” its borders in what looks like an attempt to force Nato’s hand over Turkey’s action in Syria. Against that background the official start of EU trade talks with the U.K. almost seems to fade into the background, but a Bloomberg source story highlighted again that the risk of a breakdown is pretty high, which leaves the risk that the transition period ends in December without a deal in place firmly on the table. Today’s data calendar focuses mainly on final manufacturing PMI readings for February, which are widely expected to confirm preliminary numbers. G7 finance ministers will hold teleconference this week to coordinate their response to the virus outbreak. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. Sponsored Post HFblogNews Active Member Date : 06th March 2020. FX Update – March 6 – NFP Day! 06th March USDIndex, H1 & Daily The dollar has continued to weaken versus most other currencies, correlating with the sharp decline in US Treasury yields. The USDIndex (DXY) earlier printed a fresh two-month low at 96.10, extending a decline from the 35-month high that was seen on February 20th, at 99.91. EURUSD has concurrently posted a seven-month peak, at 1.1290, which is the new culmination of the biggest two-week gain the pair has seen since February 2016. USDJPY has been undermined by both Dollar weakness and concurrent safe-haven driven outperformance in the Yen, and fell to a six-month low at 105.75. EURJPY and other Yen crosses also printed fresh lows. AUDJPY posted a four-day low, and is nearing the 11-year low the cross saw last week. AUDUSD has remained relatively buoyant, holding above recent 11-year lows on the back of the US Dollar’s weakness. The COVID-19 virus, while having so far disrupted some other economies more than the US (China, Japan and South Korea, for instance), is proving to be a leveller of the hitherto relatively robust US economy, with several states (California, Washington and Maryland) now having declared a state of emergency. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 09th March 2020 Events to Look Out For Next Week 09th March 2020. *Leading indicators such as US Inflation and GDP from Europe and the US dominate the releases next week. The highlight of the week is the ECB rate decision, while markets are going to remain focused on the threat Covid-19 poses. Have a look at the most important events of the coming days in our usual weekly publication. Monday – 09 March 2020 * Industrial Production and Trade Balance (EUR, GMT 07:00) – German Industrial Production growth is expected to have stood at 1.5% seasonally adjusted m/m in January, compared to the -3.5% decline seen in December. Housing Starts (CAD, GMT 12:15) – Canada’s improvement in January housing starts tracks the expected housing boost to Q1 GDP. In February, the index is expected to slip lower to 205K from 213.2K. Tuesday – 10 March 2020 * Producer Price Index (CNY, GMT 01:30) – Chinese February PPI is expected to have remained at the same levels as in January, at 0.1% y/y. * Consumer Price Index (CNY, GMT 01:30) – Chinese inflation is expected to drop in February as coronavirus cases soar. The overall outcome is seen at 4.9% from 5.4%, while the monthly reading should be at 0.8% from 1.4% last month. * Gross Domestic Product (EUR, GMT 10:00) – Eurozone seasonally adjusted GDP for Q4 2019 is expected to remain unchanged on an annualized and quarterly rate. Wednesday – 11 March 2020 * Gross Domestic Product (GBP, GMT 09:30) – The UK economy’s most important figure, GDP is expected to be lower at 0.2% m/m following the 0.3% reading for December. * Industrial and Manufacturing Production (GBP, GMT 09:30) – The two indices are expected to have both grown to 0.4% m/m in January, with industrial production recovering significantly from the 0.1% in the prior month. * Consumer Price Index (USD, GMT 12:30) – Expectations have been set flat for February headline CPI figure with a 0.2% core price increase, following respective January readings of 0.1% and 0.2%. As-expected February figures would result in a headline y/y increase of 2.2%, down from 2.5% in January. Core prices should set a 2.3% y/y rise for a fourth consecutive month. We have seen an up-tilt in y/y gains into Q1 of 2020 due to harder comparisons, though this lift is being capped in February and March by price weakness related to the Covid-19 outbreak. Thursday- 12 March 2020 * ECB Interest Rate Decision and Conference (EUR, GMT 12:45 & 13:30) – The ECB is under pressure to step in as virus developments hit the markets. The ECB may have planned to focus on the strategic policy review this year, but recent market developments have increased the pressure on the central bank to act sooner rather than later to address the impact of Covid-19. There isn’t much room for rate cuts, although a 10 bp cut in the deposit rate is a possibility and now pretty widely expected. If the ECB goes down that route it will likely expand the exclusion band to limit the hit for banks. In this situation where supply disruptions are increasingly apparent, lower rates may not help much, but the move would have a signaling effect, which could help to bolster sentiment. Friday – 13 March 2020 * Harmonized Index of Consumer Prices (EUR, GMT 07:00) – The German HICP inflation for February is seen steady at 1.7% y/y. * Michigan Sentiment (USD, GMT 15:00) – US consumer sentiment was revised up to 101.0 in the final February print from the University of Michigan survey, versus the 100.9 in the preliminary, and it’s up 1.2 points from January’s 99.8. This is the highest since March 2018 (which was the best since January 2004). The preliminary March Michigan sentiment reading is anticipated to decline to 97. On the flip side, a better than expected report, though it’s not likely to assuage COVID-19 fears. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 11th March 2020. Central Banks – Race to the Bottom – Again? 11th March GBPUSD, H1 The latest Central Bank to act (in another surprise and unscheduled announcement) is the Bank of England. The BoE slashed rates by 50 basis points (bp) to address Covid-19 impact. The BoE cut bank rate to 0.25% from 0.75%, saying that the decision was made at a special meeting on March 10. There will also be a new funding scheme to support lending to small businesses impacted by the fallout from the virus. Although that is the plan these funds (expected to be around 100 million GBP) usually end up supporting the UK mortgage market. At the press conference, just completed, Carney emphasized that the total package was a “big package, a big package” a number of times and clearly wanted that to be the clear message. But also caveating the message that the COVID-19 impact is likely to be short, sharp potentially significant but ultimately short-lived. The first emergency move since the financial crisis highlights the impact of the virus on the economic outlook and comes a week after the Fed cut rates by 50 bp and a day before the ECB meeting, which is also expected to bring additional easing measures. The decision was unanimous and the bank said in a statement that “although the magnitude of the economic shock from Covid-19 is highly uncertain, activity is likely to weaken materially in the United Kingdom over the coming months”. President Trump continued the pressure on the Fed yesterday with tweets aimed squarely at Jay Powell and the slow response (in his opinion) of the FED to cut rates. The ECB is expected to cut rates by at least 10bp tomorrow and with more stimulus also likely. The FOMC and BOJ also have scheduled meetings next week with more action by both anticipated, then if not before. Volatility and uncertainty persist and volumes in markets all remain elevated. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 12th March 2020. Morning Update – March 12 2020 12th March FX News Today – Wednesday washout is becoming Thursday fallout. Equities closed down 5% and now down 20% from February peak and in a BEAR market, TRUMP bans travel from Europe (26 countries) – but not bizarrely the UK. Triggers further selling in Asia Nikkei down 4.4%, ASX down 7% . – JPY, CHF up, Treasuries in demand – Oil down again Gold also slips. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 13th March 2020. Morning Update – March 13 2020 13th March FX News Today – Good Morning – The DJIA suffered its biggest 1 day fall since Black Monday 19 October 1987 – Trump travel ban, disappointment from ECB and pandemic panic gripped markets. The FED and other central banks and governments have been forced to intervene. USD sees increased demand. Volatility n Uncertainty persist. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 16th March 2020 Events to Look Out For Next Week 16th March 2020. *Another eventful week is over, while an even more busier is expected. A policy-packed week once again, with monetary policy meeting in the world’s major economies, and the potential for guidance regarding future interest rate actions, from Fed, BoJ and SNB. The focus remains squarely on COVID-19. Assuming the coronavirus continues to spread exponentially, which is what the epidemiologists are warning, global markets are likely to ensure further panicky risk-off phases. Tuesday – 17 March 2020 * RBA Minutes and House Prices (AUD, GMT 00:30) – The RBA minutes should provide guidance as to how whether the RBA members actually are prepared for further easing. The bank signalled in its last meeting that it is ready to do more in a coordinated fiscal-monetary policy action. * Average Earnings (GBP, GMT 09:30) – Average Earnings excluding bonus are expected to have grown by 3.3% in January. The ILO unemployment rate is expected to have remained at 3.8%. * Economic Sentiment (EUR, GMT 10:00) – German March ZEW economic sentiment is expected to have sharply declined to -23.4 compared to 10.4 in February. * Retail Sales ( USD, GMT 12:30) – February gains of 0.2% are anticipated for headline retail sales and 0.3% for the ex-auto figure, following January gains of 0.3% for both measures. A -3.5% drop is seen for the CPI gasoline index, with an associated drop in service station sales. Wednesday – 18 March 2020 * CPI Inflation (CAD, GMT 12:30) – Canadian core inflation is expected to have declined to 1.7% y/y, compared to 1.8% y/y in January. * Fed Interest Rate Decision and Conference (USD, GMT 18:00) – Fed announced on March 12, a massive repo term operations of a maximum of$500 bln in 1- and 3-month repos across the maturity spectrum. The market is still looking for aggressive easing by the FOMC next week, with another 50 bp rate cut with potential for move before FOMC meeting on 17th, 18th. Some Fedwatchers are projecting a 100 bp easing.

* Gross Domestic Product (NZD, GMT 21:45) – New Zealand Q4 GDP is expected to have dropped by 0.5% q/q, compared to 0.7% q/q in 2019Q3.

Thursday- 19 March 2020

*
Employment Data (AUD, GMT 00:30) – Both the unemployment Rate and the employment change are expected to have eased in February, decreasing to 5.2% and 11.6k respectively.

* BoJ Interest Rate Decision and Conference (JPY, GMT 03:00- 06:00) – Shadowed by the Covid-19, the BoJ has less room for monetary policy manoeuvre, with Japan not depending of foreign investment inflows to sustain financing and with Japanese investors apt during times of risk aversion in global markets to repatriate capital from the sale of foreign assets, and/or put on currency hedges on foreign assets. Survey data released showed large Japanese manufacturers’ business sentiment fell to a nine-year low in Q1, which will keep the BoJ under pressure to loosen monetary policy at its upcoming policy review on March 18th-19th, however markets anticipate no change in the rates by BoJ .

* SNB Interest Rate Decision (CHF, GMT 08:30) – The SNB is not expected to surprise markets as the Swiss rate is forecast to remain at -0.75%.

Friday – 20 March 2020

*
PBoC Interest Rate Decision (CNY, GMT 01:30) –The People’s Bank of China injected $79 billion into the economy through a reduction in reserve ratios for banks, while it offered discounts to banks’ reserve ratios of between half and 1 percentage point from their original level. Retail Sales (CAD, GMT 12:30) – Canada’s retail sales contracted in Q4, tracking expectations for a slowing in GDP. In contrast to Q4 outcome, January 2020 sales volume is forecasted at 0.3% gain from the flat December reading. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 17th March 2020. What is a Circuit Breaker and How it Works? 17th March 2020 The FOMC’s historic reactions to the COVID-19 spread, with its emergency 100 bp rate cut on Monday 16th of March pledging infinite liquidity, did nothing to soothe investor worries, and indeed may have sharpen recession concerns. Those fears, along with Fed coupon purchases, underpinned a strong bid in Treasuries which saw yields from the belly outward richen over 20 bps. Hence Monday’s opening was delayed as the indexes were limit down. After the FOMC’s action, the USA30 posted its largest point decline in history, sliding -2997 points (-12.9%), and the USA500 fell 11.5%, both triggering an automatic 15-minute halt. This is the third time in the past two weeks that major US and foreign indices hit their emergency circuit breaker as the market opened; this isn’t the first time that a market has been halted due to massive volatility, however it is not something that you see often. Last time it was the turmoil of the 2008 housing crisis that put the country into recession. But what is a circuit breaker and how does it work? Circuit breakers were introduced to prevent another event like the Black Monday of 1987, when the Dow Jones fell by 22.6%, in a single trading day, by pausing trading if the S&P 500 price falls too low. After being tested for the first time in 1997, they were triggered again in March 2020. So, why did that happen and how do circuit breakers work? What are circuit breakers? Circuit breakers, which are calculated daily, are set at 7%, 13% and 20% of the closing price of the S&P500 for the previous day. If the price drops 7% in a single session, trading is halted for 15 minutes, and, depending on what happens next, trading may be halted again temporarily or for the rest of the day. How do circuit breakers work? There are three levels: A level 1 circuit breaker is applied when there is a single-day, single-session decline of 7%. Trading is paused for 15 minutes to give traders the chance to reevaluate their options and stop panic selling. If there is improvement when trading is reopened after the break, the session will continue as usual. If the drop continues and reaches 13% before 3:25pm (New York time), a level 2 circuit breaker will be applied and trading will be stopped for another 15 minutes. If the drop continues still further and reaches 20%, the situation is considered critical and a level 3 circuit breaker will come into force. At this highest level, trading is stopped for the rest of the day regardless of what time it is. Are circuit breakers used only for market indices? No, they’re not! Individual securities have their own circuit breakers, known as the “Limit Up-Limit Down rule”, which means that trading is stopped whenever the price moves too far up or down away from predetermined acceptable levels. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. HFblogNews Active Member Date : 18th March 2020. FX Update – March 18 – King Dollar 18th March 2020 The Dollar has remained firm amid nervous global markets, with demand for cash dollars remaining high while some traditional safe haven assets, such as gold and US Treasuries, have nonetheless remained under pressure as investors rebalance portfolios and build cash cushions to cover margin calls. US bonds have been falling despite the Fed buying up to$40 bln worth daily in its revamped QE program. Some market narratives are also pointing to concerns about the US fiscal position light of the US government’s announcement for a $1.2 tln stimulus package. Gold prices are down 1.5%, though remain off the three-and-a-half-month low seen on Monday. Stock markets turned lower during the Asian session and opened in Europe down some 3-4%. In currencies, movements have been relatively contained so far today. The Yen has outperformed, though concurrent Dollar strength has seen USDJPY lift back above 107.00 from a 106.76 low. The commodity and most developing world currencies remained under pressure. AUDJPY declined by over 1%, and has breached the 11-year low seen yesterday, trading at S1 – 63.80. AUDUSD remained heavy, also breaching the 17-year low seen yesterday at 0.5960, it trades at 0.5936. NZDUSD printed a fresh 11-year low at 0.5911. USDCAD, amid its biggest monthly gain since January 2015, remained buoyant but still held below the four-year high seen yesterday at 1.4276. USOil prices hit a new major-trend low at$25.50, which is the lowest nominal level traded since May 2003. EURUSD ebbed back under 1.1000, but has so far remained shy of the three-week low seen yesterday at 1.0956. Regarding the coronavirus, there are concerns that the massive global fiscal and monetary stimulus measures, even when targeted well, will simply not be able to fully mitigate the impact of draconian lockdowns in an increasing number of economies.

Please note that times displayed based on local time zone and are from time of writing this report.

Stuart Cowell
HotForex

Disclaimer:
This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HFblogNews

Active Member
Date : 20th March 2020.

European FX Update – 20 March 2020 20th March 2020

Interventions and the threat of interventions has seen the dollar soften while commodity and many developing world currencies have rebounded strongly following a period of pronounced underperformance. Also in the mix is the plethora of central bank actions to shore up liquidity and loosen monetary policy, along with the massive fiscal rescue packages being assembled by governments across the world, which have given markets opportunity to settle from coronavirus anxiety. Russia and Brazil have intervened in forex markets over the last day, buying their domestic currencies and selling dollars. The Russian ruble crashed by over 34% from early January levels before the Russian central bank stepped in yesterday. The Norwegian central bank also threatened to intervene yesterday following a similar 30%-odd dive the crown. South Africa and Australia have also signalled readiness to intervene to support their currencies. For many countries with borrowings in dollars, the massive depreciation in their domestic currencies, and strength in the dollar, has been increasingly threatening at a time when most emerging market and developed-world economies are either headed to or are already in recession. There is rising odds for coordinated action to blunt dollar strength. Demand of cash dollars has been intense in recent weeks due to the funds need to cover losses and meet fund redemptions.

Among the main currencies today, the narrow trade-weighted dollar index (DXY) has declined by 1.3%, to 101.50. The index peaked at a 38-month high yesterday at 102.99. EURUSD has concomitantly lifted by over 1% to levels above 1.0800. Cable rallied by nearly 3% to levels back above 1.1800, up from yesterday’s 35-year at 1.1451. USDJPY dropped back to the lower 109.00s from levels above 111.0, though the yen still weakened against many other currencies.

Biggest (FX) Mover @ (09:30 GMT) AUDUSD (+3.48%) – Rallied from 0.5680 at open, over 0.5800 & 0.5900. The MA’s aligned higher, RSI (67) positive, MACD histogram & signal line rising and breached 0, Stochastics moving higher but not yet into OB zone. – H1 ATR 0.0063, Daily ATR 0.0205.

Please note that times displayed based on local time zone and are from time of writing this report.