The market takes breath after the long rally. What opportunities do traders have today?
Daily News: Monday, March 5
Finally, Italian parliamentary and German coalition elections happened. Let’s look how they affected the single currency and which events happened during the weekend.
- As the information from Italy and Germany was mixed, the euro showed an unclear movement.
Based on the positive news from Germany where the Social Democrats agreed to work in a coalition with Angela Merkel’s Christian Democrat bloc, the single currency climbed to the important level at 1.2360. However, Italian elections’ results did not let it go further, so the euro turned around and started declining. Final votes have not been counted yet, but at the moment, the anti-establishment parties are outperforming. The majority of the Euro-sceptic parties in the parliament will lead to the unstable environment in the European Union. However, there are some factors that can support the single currency. They are Brexit negotiations and a US market situation.
- The Australian dollar is falling. It was a big amount of data today in the morning, however, it was mixed and could not support the Aussie. Building approvals (m/m) and company operating profits (q/q) data were bigger than expected, but the actual MI inflation gauge (m/m) was less than the forecast one. Tomorrow there will be a bigger amount of important data: current account (2:30 MT time), retail sales (2:30 MT time), and interest rate (5:30 MT time). However, according to the forecast, the data will not support the Aussie as well. The interest rate will remain unchanged, the current account will be less than the previous one.
- The US tariffs on imported steel and aluminum caused worries of investors. Global trade wars hit risk appetite that led to the stock fall. US equity futures declined as well.
- The yen is continuing to appreciate against the dollar. USD/JPY opened below an important level of 105.5 and went further. Now the pair is trading near 105.35. The next crucial level is 105.
- The gold is continuing to rise since Friday. The commodity is trading above 1328 an ounce.
- As there is no important data for the Cable, the pound does not show a big movement, however, it lost some points since Friday.
- USD/CHF is rising today. Swiss CPI data that is anticipated tomorrow at 10:15 MT time. If the actual data is greater than the forecast one, the Swiss franc will be able to move closer to the resistance at 0.9398.
- There were no important data for other currencies yet. So their positions have not changed a lot since the Friday session.
- China’s National People’s Congress opens today. Debt, gambling, and property tax can be discussed at meetings. Policy shifts can move the big banks, green stocks or bonds. So do not forget to follow.
The United States will publish a weekly update on unemployment claims on July 9, at 15:30 MT time.
The market sentiment deteriorated amid increasing virus cases in the USA and Australia. Investors prefer safe-haven assets like gold, the US dollar and the Japanese yen.
Riskier currencies and stocks are in favor of investors. Surprisingly, gold rallies too. Let’s have a closer look.
Congratulations! Gold has just opened a new era... or, rather, reopened...
Canada will publish the employment change and the unemployment rate on July 10, at 15:30 MT time.