While the coronavirus is taking up all the headlines, let us not forget that there is an oil price war at hand. Brent oil is trading around $25 per barrel and Crude oil around $23. United States President Donald Trump has authorized the Department of Energy to fill the reserve to maximum, by buying 77 million barrels of American Crude Oil while prices are low. We have to keep in mind that the American shale oil producing companies are at the biggest risk of low oil prices while Saudi Arabia and Russia are much better prepared and can withstand low oil prices much longer. There is an anti-correlation being observed between Crude Oil prices and the USD, as oil prices fall USD rises and vice-versa. With US general election slowly but surely approaching closer day by day, a strong USD is not in favor for President Donald Trump, and as the Fed has already cut the interest rate down almost to 0% it will be interesting to see what steps the President of the United States will take next.
The number of coronavirus infections has surpassed 222,500 according to Johns Hopkins University. New statistics show that the younger generation is not as susceptible to COVID-19 as previously thought after the initial breakout in China. According to a statistics website – Statista, ¼ of those infected in Italy are younger adults ranging in age from 20-40 years old, with a similar trend being observed in the United States.
The United Kingdom is taking some steps to contain the virus, albeit small. Prime Minister Boris Johnson is considering limiting public transport but London will remain open and Londoners will not be confined for the time being. The Bank of England has cut its interest rate by 15 basis points to 0.1% and the European Central bank has increased debt buying by a whopping 820 billion USD.
EUR/USD on a Daily TF dropped as low as 1.07260, and currently trading around 1.07910. 13EMA is approaching 48EMA for an intersection down. Bearish MACD histogram has increased. The price is approaching the bottom of the channel of our trend line down from August 2017 as support.
Resistance: R1 1.08300, R2 09100, R3 1.09500.
Support: S1 1.07260, S2 1.07, S3 1.06500.
GBP/USD on a Daily TF dropped as low as 1.14477 and currently trading around 1.17321. MACD bearish histogram has increased.
Resistance: R1 1.18715, R2 1.20560, R3 23.6% Fibo 1.21398.
Support: S1 1.17, S2 1.16, S3 1.14477.
USD/JPY on a Daily TF has broken above 200EMA and attempting to break above global trend line down from June 2015 as resistance. The pair created a high of 110.182 and currently trading around 109.860.
Resistance: R1 110.430, R2 111.363, R3 112.092
Support: S1 200EMA 108.789, S2 48EMA 108.304, S3 107.665.