Coronavirus Fears Persist, EUR the Big G10 Gainer, AUD the Main Loser

Virus Cases Outside China Surpass Cases in China

The dollar traded mixed against the other G10 currencies on Wednesday and during the Asian morning Thursday. It gained against AUD, GBP, CAD, NOK and NZD in that order, while it underperformed versus EUR, CHF, JPY and SEK.

Brent Oil — Technical Outlook

Yesterday, Brent oil broke below its key support, near the 53.49 level, which was the previous lowest point of February. Given the recent slide, we can now draw a short-term tentative downside resistance line, connecting the two peaks of January 8 thand February 20 th. Our oscillators, the RSI and the MACD, started pointing lower again and thus, for now, we will take a bearish stance and continue aiming slightly lower.

EUR the Main G10 Gainer, AUD the Main Loser, GBP the Second Loser in Line

Back to the currencies, the euro was the main gainer among the G10s, coming under buying interest after reports suggested that Germany’s finance ministry is seriously considering to boost fiscal spending, due to growing pressure to support the nation’s sluggish economy. The euro had been in a sliding mode from the beginning of the month and up until last Thursday, perhaps on speculation that the soft economic data out of the Euro area may put pressure on ECB policymakers to ease further. However, fiscal stimulus will alleviate some of that pressure, and that’s why the euro recovered decently yesterday.

EUR/GBP — Technical Outlook

EUR/GBP made a decent move to the upside yesterday, lifting itself above the 200 EMA on the 4-hour chart. However, we can see that the pair remains stuck between two of its tentative lines, a short-term downside one taken from the high of January 14 thand a short-term upside one drawn from the low of February 18 th. As long as the rate continues to trade between those two line, we will stay neutral and wait for a break through one of them before considering a further directional move.



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