Sterling slipped after UK Prime Minister Boris Johnson was moved to the intensive care unit for coronavirus treatment, but the broad risk trade remained strong on optimism with slowing growth in the number of Corona virus cases. The Australian dollar was the top performer while the yen lagged. The RBA decision is up next. A new Premium trade was posted at the close of the NY session, backed by 3 charts and notes. 


A statement from 10 Downing said PM Johnson was taken to the ICU for precautionary reasons and that foreign minister Dominick Raab had been deputized to handle the PMs duties. Cable quickly fell 80 pips to 1.2215 on the report but held the lows from earlier in the day on the report in the Russian press that he had been intubated.

In the US, the S&P 500 rallied 7% and broke around a cluster of resistance at 2650. That level was the late-March high and the 38.2% retracement of the coronavirus drop. A Fox Business news report indicated that Congressional leaders had briefed Wall Street executives about a new $1.5 trillion stimulus package that's in the works, and will be ready by month end. It's another sign of the endless appetite for spending from governments to cushion the economic decline. It's also another reminder of the costs that will need to be paid one day, and that helped fuel gold by $40.

In OPEC news, the battle lines for cuts on Thursday continue to harden with more reports that OPEC+ wants the US to participate. They have to know that it's virtually impossible to execute a national US cut. If that's the case, then the entire call is a public relations exercise.

Given the stakes, this would be an odd time for that kind of stunt. A more-likely outcome is a cut and a statement that says they expect the US to join. When that invariably doesn't happen, they will have cover to cheat or hike when it suits their needs. Oil fell nearly 8% on the day.

Looking ahead, the RBA is entirely expected to leave rates unchanged at 0.25% in the 0430 GMT rate decision. The latest minutes said there was no appetite for negative rates and the central bank has already unveiled QE. In normal circumstances it would be far too early to anticipate any kind of further action but at the moment it's not out of the question. A statement indicating that the pace of bond buying could increase could weigh on the Aussie, but it's an outlier.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Analysis feed

FXStreet Trading Signals now available!

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

Latest Forex Analysis

Editors’ Picks

EUR/USD chops around amid end-of-month flows, ahead of Trump

EUR/USD is battling 1.11, close to the two-month highs amid choppy trading. Hopes for a fiscal boost in Europe and mixed satisfactory data have supported the currency pair. , Sino-American tensions are rising and investors await President Trump's China announcement.


GBP/USD advances amid US dollar weakness, shrugging off concerns

GBP/USD is trading above 1.23, edging higher amid US dollar weakness and Britain's gradual reopening. Intensifying Sino-American tensions and the Brexit impasse are ignored. 


Cryptocurrencies: $348M in matured derivatives boost the market

Futures and options contracts' expiration brings a wave of volatility to the crypto market. Ethereum takes advantage and attacks resistances in the market dominance chart, Bitcoin goes back. Ripple disappoints despite regaining the third place in market capitalization.

Read more

Canada's economy falls by 8.2% annualized in Q1, better than expected, USD/CAD shakes

The Canadian economy squeezed by an annualized rate of 8.2% in the first quarter of 2020, better than -10% expected. Quarterly, Gross Domestic Product (GDP) squeezed by 2.1%. Most of the downfall occurred in March, with a drop of 7.2%, better than 8.5% projected. 

Read more

WTI drops 4% and eyes $32 mark amid risk-off, weakening demand

The selling pressure around WTI (July futures on Nymex) accelerates following the break below the 33 level, as bears now target the 32 support zone heading into the key US macro data and US President Donald Trump’s response to the Hong Kong issue.

Oil News

Forex Majors