Thursday was a very busy day in terms of macroeconomic statistics. Also important statements of ECB head clarified some situation. From the US data and Christine Lagarde’s statements it became clear that it is not so easy for the whole economy to recover.
The markets took a break on Thursday and closely followed the main data. Christine Lagarde made it clear that economic recovery in Europe is not worth waiting for until 2021, and 2020 will be in deep recession. In the U.S. after the release of economic data markets have suspended their weekly growth, as the resulting statistics do not reflect the current rally in the markets. The DAX index has been practically on the spot the whole trading session. The S&P500 index is falling by 0.5%. On Friday, it is unlikely to expect any serious movements, as there is likely to be some profit taking and closing of the trading week.
The US dollar has completely lost its position against the Euro. After the ECB meeting and the announcement of additional aid to the European Union in the amount of 1.35 trillion euros, the EUR/USD exchange rate has moved to the monthly SMA200 1.1330. Of course, for many people such growth is too fast, but in the current situation there is a possibility of correction. The economy of the European Union is very weak now and the quarantine restrictions will still strongly affect it. Central banks usually have a relatively large time lag of up to one month. Therefore, the EUR/USD pair is likely to have a correction period soon, to the level of 1.12.
WTI oil is gaining momentum very slowly, but the volatility in this market has subsided. Although OPEC+ is trying to work, but incomprehensible statements about the postponement of the meeting, slow reaction to sharp changes in the markets, as well as regular changes in its position, mislead investors. So far WTI oil has been holding at $37.5 per barrel. As long as there is relative stability in the market, the oil price will move upwards following the growth of the leading countries’ economies.
As we expected, as soon as a negative note appeared in the markets due to macroeconomic data, so immediately gold began to rise in price. The rebound from $1700 level was obvious. The gold returns to the range above $1700 per ounce and will try to break above $1750.
What’s waiting for us today?
8.00 Production order volume in Germany for April.
14.30 Change in non-agricultural employment in the USA
16.00 PMI Canada business activity index
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