It's been another incredible week in the markets but one that at least looks likely to end on a positive note, with stock markets making decent gains for a second day.

This isn't enough to put the week into the green but we're not far away and there's still time. It's also far to early to call the bottom in the markets, in fact I'd be very surprised if that's what we're seeing. But it is always encouraging to see buyers coming back in, as central banks around the world flood the markets with liquidity.

Central banks around the world have not shied away from the task this week, with many holding unscheduled meetings, cutting interest rates and announcing other measures to support their economies. At least 14 central banks have cut interest rates while the Fed, ECB and BoE are all once again aggressively buying assets. The Fed has also announced numerous other measures to ensure the plumbing of the financial system is still functioning as needed.

With the number of cases still accelerating around the globe and countries increasingly moving towards lockdown, I don't see this as being the bottom, unfortunately. We often talk about green shoots during times of economic slowdowns and recessions but stock have fallen so far, it may just take signs of momentum loss in the number of new coronavirus cases to pique investors interest once again.

Once again we're heading into the weekend and I'm already nervous about Monday's open. A lot can happen over the next few days and these are very sensitive markets. We're still in acceleration mode in many of these countries and the job losses are only just starting. Government's are doing everything they can to look after firms facing difficulties but casualties are inevitable, we've already seen some in the UK and more will follow.


Oil enjoys rebound, for now

Oil prices have rebounded in tandem with risk appetite over the last couple of days, coming off the lows of close to $20 in WTI and $24.50 in Brent. These are staggeringly low levels in both cases but at a time of global recession and an oil price war, what do we expect? I don't expect a strong rebound in the near-term, with neither Russia or Saudi Arabia looking likely to blink, but we could now start to stabilize around these incredibly low levels.


Lag effect possible in gold

Gold prices appear to be stabilizing but its role in the markets right now is anyone's guess. Today's it's rebounded alongside the improvement in risk appetite, while falling for much of the week as central banks around the world threw the kitchen sink at the coronavirus. Their efforts are not in vain but we're not seeing the surge in demand for gold that we've seen in the past when the market is flooded with liquidity. I feel there may be a lag effect, with investors still liquidating gold positions to fill holes elsewhere but only time will tell.


Crypto fans more relieved than most

No one will be more relieved than crypto fans about the rebound over the last 48 hours. After falling 63% from mid-February to mid-March, it's now rallied more than 70% in less than a week to trade close to $7,000. It will be difficult to maintain these gains though as I don't think the worst in the markets is behind us and cryptos have clearly been among the victims. Worse days may still lie ahead.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.

Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Analysis

Latest Forex Analysis

Editors’ Picks

EUR/USD: At risk of extending its slide

The greenback closed the week appreciating against most major rivals, although EUR/USD settled in the 1.1780 price zone, holding on to modest weekly gains. EUR/USD decline corrective on the broader view but could extend its slump in the shorter-term.


GBP/USD: Limited bearish potential

The GBP/USD pair finished the week with modest losses at 1.3050, giving up to the dollar’s demand at the end of the week. The Cable is trading above the 1.3000 level, which limits the bearish potential.


Gold: Acceptance above $2050 critical to revive the uptrend

Gold’s record-breaking rally could resume on a sustained move above $2050. RSI on 4H chart stays in the bullish territory, pointing to the upside. XAU bulls to buy the dips around $2010 in the week ahead?

Gold News

Bitcoin may extend the recovery once Gold resumes the rally

Gold retreated from the recent highs, but the sentiments are still bullish. Cryptocurrencies resumed the upside, some altcoins are demonstrating strong gains. ETH/BTC stopped the downside correction and settled at $0.03300.

Read more

WTI extends slide toward $41, on track to post weekly gains

Crude oil prices continued to fall on Friday and the barrel of West Texas Intermediate (WTI) touched a daily low of $41.05 before recovering modestly.

Oil News

Forex Majors