- USD/JPY fails to portray the magnified risk aversion, register modest moves.
- Global policymakers’ efforts to tame coronavirus and its negative implications on the financial markets failed.
- Fitch warned of further risk to structured financial markets, Ohio health officials estimate 100,000 people in the state as infected.
- No catalysts have more importance than the speedily spreading coronavirus.
USD/JPY carries the previous day’s lack of moves, despite broad risk-off, while taking rounds to 104.60/65 amid the initial Asian session on Friday.
Be it US President Donald Trump and Aussie PM Morrison’s multi-billion stimulus or the ECB’s extension of QE, nothing could placate traders from the fears of the coronavirus (COVID-19).
Global markets portrayed the sea of red on Thursday as the deadly virus infected the mainstream media and sports personalities. It’s worth mentioning that the NY Fed’s liquidity infusion through repo actions offered a little help by the end of the previous day. However, that move is yet to be justified as full markets are still absent.
That said, risk barometers dropped heavily across the globe with the equities revisiting multi-year lows and the treasury yields marking losses.
The latest on the pandemic suggests additional burden on the risk-tone as the global rating agency Fitch came out with its warnings while an official from Ohio estimates more than 100,000 cases in the state. Further, the Italian market regulator recently came out with its ban on temporary short-selling of some stocks. Additionally, the US Senate delays decision on the coronavirus relief bill to next week.
Considering the market’s reaction to the coronavirus updates, coupled with a lack of major data/events on the economic calendar, investors are likely to look for anywhere else for catalysts.
Technical Analysis
Thursday’s bullish spinning top needs to be backed by sustained trading beyond 106.10 to regain the buyers’ confidence.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.