coronavirus outbreak

The coronavirus outbreak is intensifying, and Beijing is scrambling.  Outrage is growing as local officials failed to address the contagion risks earlier.  Millions of Chinese are unable to travel to see their families to celebrate the Lunar New Year, which is the equivalent of the Thanksgiving and Christmas holiday combined.  China has the highest emergency levels in place and is locking down 40 million people.  State media has the death toll at 26 and concerns are growing that the travel bans in place will start to have a major impact on the economy with some calling for a 1 percentage point hit or greater with Chinese GDP. 

Oil Gold 1/23

Oil

Oil prices are getting battered by falling demand concerns that have stemmed from growing travel bans in China.  China has quarantined Wuhan, a city of 11-million and Huanggang city, which has a population of 7.5 million.  Oil is struggling to stabilize here since both the supply and demand side news have been mostly bearish.  Oil can’t shake non-OPEC production oversupply concerns followed by fading optimism OPEC + will be able to continue to delivering production cuts deeper into 2020.  Oil is resting on critical support and swelling supplies in the US could be the straw that breaks its back in the short-term.

Gold

Gold prices are softening despite a wave of risk aversion in Asia, as investors become skeptical the upcoming Lunar New Year holiday will see limited gold purchases from China.  All the travel bans occurring in China have shifted the focus of many to securing food and medical supplies and not holiday buying of gold.  Gold sellers are focusing on a barrage of bearish signals that include the possible formation of a death cross.  The yellow metal has been a tight $30 range over the past two weeks and it seems that when it finally breaks momentum traders could help extend the move.

forex EUR/USD 1/22

EUR/USD will trade in a tight range in Asia ahead of the ECB policy meeting 0045 GMT. CBA expects the ECB to leave rates on hold, but expect the central bank to reiterate its open-ended easing bias and emphasize again the need for an extended period of monetary accommodation. The ECB should also deliver an insight into its monetary policy review. CBA adds it is believed the ECB will likely divide its remit, including monetary policy, into two areas. Separating price stability inflation targeting from other areas such as climate change and financial stability.

EUR/USD

EUR/USD traded 0.08% higher while the Australian dollar out-performed with gains of 0.14% versus the US dollar and 0.16% versus the Japanese yen. AUD/USD has snapped a two-day losing streak and rebounded ahead of the 55-day moving average at 0.6868.

AUD/USD Daily Chart

Source: OANDA fxTrade

 

forex EU/RAUD chart 1/20

	The following assumptions that have been made: - At least 20 pip forecast - The key level and chart pattern were at most 5 candles apart at time of identification

	Symbol : EURAUD

Direction : Identified time : 2020-01-21 03:00 GMT Breakout price : 1.61769 Forecast price : 1.62002 Forecast pips : 23 Probability : 64.83 %

Pattern : Double Bottom Interval : 60 Min Pattern : Resistance Interval : 30 Min