Last session market review
In the last session, the dollar index fell all the way to 98.24 under pressure and is still struggling to stay low. Meanwhile, spot gold is trading in a fairly tight finishing range around $1,626 an ounce. U.S. stocks fell sharply on Friday, giving up some of their strong gains of the previous three days, with the Dow down more than 900 points.
The rest of the session will focus on the global spread of COVID 19 and the NAR’s seasonally adjusted preexisting home sales index for February.
Fx: Eur/USD closed at 1.1140; The pound closed at 1.2456; The Australian dollar closed at 0.6165; The dollar closed at 107.89 yen; Us $1.3977; The dollar closed at 0.9512 Swiss francs.
Commodities: spot gold closed at $1,625.24 an ounce; Comex gold ended at $1,625.00 an ounce; Spot silver settled at $14.48 an ounce; Comex silver ended at $14.534 an ounce; Brent crude settled at $24.93 a barrel; NYMEX crude settled at $21.51 a barrel.
In the currency market
The euro: the dollar fell after a recent rally, with the euro/dollar ending higher for a sixth straight session at 1.1140, up 1.0%. Technically, the daily chart shows that the pair has failed to break its moving average, which is now limited to a small range. Momentum indicators have resumed their downward trend around oversold levels, while RSI has lost its directional strength at neutral levels, leaving the risk skewed to the downside. Descending direction, initial support at 1.0960, further support at 1.0900, if lost will open the way to 1.0835 and 1.0635. On the upside, resistance over the next few days is at the weekly high of 1.1090, followed by the 61.8% retracement of the recent decline at 1.1165. In a risk-averse environment, the rally seems unlikely to surpass the latter level.
Sterling: the pound rose for the fourth day in a row, breaking through the 1.24 barrier to close 2.1% higher at 1.2456. On a technical level, the relative strength index on the daily chart has recovered from below 30, freeing it from oversold conditions and allowing for further declines. Momentum is still skewed to the downside, the exchange rate is well below the 50 -, 100 – and 200-day moving averages. In short, the bears are in charge. The downtrend, initial support at 1.22, followed by 1.1970, if lost will fall to 1.18. Upward direction, initial resistance at 1.25, further resistance at 1.2610, such as the breakthrough will go to 1.2720.
Yen: dollar/yen fell for the fourth day in a row, losing 1.53% to 107.89 at 108. Technically, the dollar/yen reversal over the past month has brought RSI comfortably back into the top 50 after it hit overbought levels on February 19, 20 and 21 and oversold territory on March 6 and 7. The initial resistance to the rise of the exchange rate at 108.40, further resistance at 109.00, the more critical resistance at 109.60. The initial support of the exchange rate down at 107.70, further support at 107.25, more critical support at 106.50.
The stock market
U.S. and European stocks: sentiment took a hit as investors refocused on the outbreak of a new flu outbreak after the U.S. became the world’s most newly confirmed country. Us stocks fell sharply on Friday, giving up some of their strong gains of the previous three days and ending another turbulent week on Wall Street. The dow jones industrial average fell 915.39 points, or 4.1%, to 21,636.78. The s&p 500 fell 3.4% to 2,541.47, while the NASDAQ composite index closed 3.7% lower at 7,502.38.
European stocks closed lower on Friday as investors closely watched the spread of a novel coronavirus and policymakers scrambled to agree ona unified response. The pan-European Stoxx 600 index temporarily closed down 3.3%, led by Banks and autos, which fell more than 5%, with all sectors and major stocks in negative territory. Germany’s DAX closed down 370.71 points, or 3.71%, at 9,630.25. Britain’s FTSE 100 closed down 304.48 points, or 5.24%, at 5511.25. France’s CAC-40 index closed down 192.09 points, or 4.23 percent, at 4351.49. Spain’s IBEX35 index closed down 235.69 points, or 3.35 percent, at 6,797.51. Italy’s FTSE closed down 527.38 points, or 3.04 percent, at 16,842.00. Europe’s Stoxx 50 index closed down 121.23 points, or 4.26 percent, at 2,726.55.
The bond market
Long-term Treasury yields fell on Friday as investors fretted over the number of COVID 19 infections in the United States, which has the highest number in the world at 100,717, according to new data from Johns Hopkins University. The yield on the benchmark 10-year Treasury note fell to 0.77 percent, while the yield on the 30-year note fell to 1.36 percent.
International spot gold started at $1,629.10 an ounce in early trading on Friday, rising as high as $1,635.70 an ounce, and dipping as low as $1,611.74 an ounce, down $3.75 or 0.23% to $1,625.24.
COMEX April gold futures closed down $26.20, or 1.6 percent, at $1625.00 an ounce.
Us cities and businesses are bracing for more shutdowns after the us virus novel coronavirus killed more than 100,000 people, making it the world’s most infected country. Oil prices extended their decline on Friday, recording a fifth straight week of losses, on fears of a further reduction in demand. U.S. WTI crude for April delivery fell $1.09, or 4.8%, to $21.51 a barrel. U.S. WTI crude fell 4.1% this week. Brent may futures fell $1.41, or 5.4 percent, to $24.93 a barrel. Brent crude fell 7.6 percent this week. Both are down more than 50% so far in March, heading for their worst month on record.