By the end of the trading week, market volatility is falling. News on coronavirus has fallen into the background, but very alarming situation comes from Brazil and poor countries, where it is impossible to restrain the coronavirus epidemic.
Of course, it is important for world leaders to restore the economy as soon as possible. This topic has flooded the news so far. However, it is not that simple, unemployment in the USA has not reached its peak, and the numbers will be even higher. Markets are slipping, S&P 500 is still hovering near the 3000 level. Only serious news on further stimulation of the economy, as well as good reporting of large companies, can push it above this level.
The crisis of the pandemic has shaken the Eurozone and strengthened the Fed’s position. The Euro will probably never be the number one currency in the world. Recent months have shown that the dollar has a dominant position in world trade, central bank loans and reserves. At the moment, the Euro is in trouble. The leaders of the European Union want to create a recovery fund, but at the next meeting of the European Commission, due to eternal disputes among members, this proposal may never come true. The euro can’t take the level of 1.10 yet, and in the nearest future it will remain in the channel between 1.10 and 1.0750.
In the current situation, Bitcoin risks falling to $8,000. The pressure of the miners due to halving on the market will decrease, especially they need the price increase to support profitability. Some may exit the market by selling all the inventories, which may lead to a fall. There is now a strong split between the Bitcoin and the stock market, and it is worth waiting for governments to invest in the economy so that the market can understand where to go. Traders have already started to exit the bitcoin, which indicates a sharp drop in the price of $9000. The road to downside movement is open.
As expected, on Thursday, gold corrected after reaching seven-year highs. In principle, nothing terrible happened, the decline was not more than 2%, which is quite normal for the current situation. The growth forecast is not cancelled. On Thursday gold traded at $1720 per ounce, the lower border of the upward channel.
What’s waiting for us today?
08.00 UK retail sales volume for April.
13.30 Publication of minutes of ECB Monetary Policy meeting
14.30 Canada Basic Retail Sales Index for March
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