Economic Downturn Likely to Worsen Further, Here's Why

Updated 09:21AM 16/04/2020

In the G10 FX Market, NOK and CAD are the top gainers today, up 0.2% and 0.13% versus the dollar while NZD and JPY are the top losers, down -0.43% and -0.27% versus the dollar, respectively.

 

Investor remained uncertain after very bad retail and factory data showed the extent of the weakness in U.S. economic activity led by the novel coronavirus. In our view, the uncertainty is only going to get worse with income inequality and unrest rising across the globe. We already saw a protest in Michigan where ultra-rightwing came out to demand a return to normalcy. This is likely to be a net negative risk.

 

In the rates market, global yields were trading weaker with the US 10-year yield up +1.2 bp trading at 0.647 and the German 10-year yield up 2.3 bp trading around -0.439. In the Asian Session, Equities markets were trading mixed with S&P 500 futures 0.75% at 2795.88, the Nikkei -1.38% at 19280.5, and the Hang Seng -0.46% at 24034.0 In the energy space, the Brent front month is trading up 1.88% for the day at $28.21.

 

10-year Yields Daily Chart (6-month)

 
 

Daily FX Pivots

 
 

Brent Crude Daily Chart (1-month)

 
 

(Content and Data by Tradermade)

 

Forex Chart and Technical Analysis

 

EURUSD Chart (Two-week)

 
 

Strategy: Resistance at 1.092 for 1.0848
Short-term view: EUR/USD resistance comes in at 1.092 MACD and RSI have a bearish bias. Hence, we see a dip to 1.0848 enter at 1.0896. Above 1.092 to open 1.0983.

 

GBPUSD Chart (Two-week)

 
 

Strategy: Resistance at 1.253 for 1.2428
Short-term view: GBP/USD resistance comes in at 1.253 MACD and RSI have a bearish bias. Hence, we see a dip to 1.2428 enter at 1.2499. Above 1.253 to open 1.2623.

 

USDJPY Chart (Two-week)

 
 

Strategy: Support at 107.41 for 107.9
Short-term view: USD/JPY support comes in at 107.41 MACD and RSI have a bullish bias. Hence, we see bounce to 107.9 enter at 107.57. Below 107.41 to open 106.95

 

AUDUSD Chart (Two-week)

 
 

Strategy: Resistance at 0.6349 for 0.6254
Short-term view: AUDUSD resistance comes in at 0.6349 MACD and RSI have a bearish bias. Hence, we see a dip to 0.6254 enter at 0.6318. Above 0.6349 to open 0.6414