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Market Update: Trump Losing Supports Over Rising Covid Numbers, EU Leaders In Disagreement For EU Stimulus Plan

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Market Update:  Trump Losing Supports Over Rising Covid Numbers, EU Leaders In Disagreement For EU Stimulus Plan

(20 July 2020)

The USD index (DXY) continues to trade lower this morning, reaching one of the longest bearish trend in the last 18 months. While the UK is still stuck with UK-EU trade deals, internal conflict between England, Scotland and Wales, and rising Covid cases. EUR traded sideways this morning due to the North EU and South EU leaders unable to reach an agreement for the Europe stimulation plan.

 

USD

USD traded lower against major currencies this morning, cancelling last week’s recovered effort and moved downwards again, it slumped slightly from last week’s 96.18 to 96.13. Even though the Covid pandemic situation in the US is getting out of hand (which should push USD higher), but the recovering economy, market’s risk-taking sentiment, and Trump’s lowered election support may continue to make USD fall.

This week’s event:

Wed – Existing Home Sales, Crude Oil Inventories

Thu – Initial Jobless Claims

Fri – New Home Sales

 

GBP

For the last few weeks, GBP is the least performing currency as compared to the other major currencies, it fell from June’s peak of 1.2813 to the current 1.2520, its past rally happens only because of the weakening USD and not by its own gains. UK is now shadowed by internal tensions between England, Scotland and Wales, falling behind to EU on its Covid curbing progress, and the same fruitless trade talk with EU.

This week’s event:

Fri – Composite PMI, Manufacturing PMI, Services PMI

 

EUR

EUR manage to achieve a four-week rally, the longest since early 2018 and is now testing the resistance around 1.1450, weak USD counterpart is also a factor to drive EU’s prices up. However, the resistance is strong and a retracement is very possible soon if the North EU and South EU leaders could not agree on the EU stimulation plan.  

This week’s event:

Fri –  German Manufacturing PMI

 

AUD

Similar to EUR, AUD had experienced a four-week rally against the USD (although smaller in scale), it is firm but lingers around the 0.6800 to 0.7000 range without really breaking the resistance. It is not surprising to see a correction retracement if the momentum still could not bring it over the 0.7000 resistance level.

This week’s event:

Mon – RBA Meeting Minutes

Tue – Retail Sales

 

The Market Today Morning

USD Dollar Index (DXY) slumped to 95.93 from last week’s highest of 96.70

USD/CNY dropped to 6.986 from last week’s highest of 7.019

USD/JPY rose to 107.27 from last week’s lowest of 107.43

EUR/USD shot to 1.1453 from last week’s lowest of 1.1300

AUD/USD rose to 0.6991 from last week’s lowest of 0.6921

GBP/USD dropped to 1.2543 from last week’s highest of 1.2666

XAU/USD shot to 1809.64 from last week’s lowest of 1790.76

Data from Tradingview.com (UTC+8)

 

Sources: 

http://forex.cnfol.com/jingjiyaowen/20200720/28282382.shtml
http://forex.cnfol.com/jingjiyaowen/20200720/28282383.shtml
http://www.marctomarket.com/2020/07/ranges-may-fray-but-do-you-play-for.html
https://www.investing.com/economic-calendar/
https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2020/07/19/USD-May-Fall-Despite-Rising-Covid-19-Cases-Euro-Holding-Breath-on-EU-Summit.htm

 

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