Technical Outlook: In my last Gold Price Outlook we noted that the XAU/USD rally was vulnerable heading into the close of March trade and that, “ultimately a larger pullback may offer more favorable entries with a breach of the highs needed to keep long-bias viable.” Price plummeted more than 5% to register a low at 1560 before ripping to fresh yearly highs into the April open.The advance failed at slope resistance this week with price unable to mount a daily close above the 78.6% retracement of the decline from the record highs at 1733. Initial daily support rests at the March high-day close at 1678 backed by the median-line / 38.2% retracement of the yearly range at 1633- look for a larger reaction there If reached. Key support / bullish invalidation now rests at 1564/85.
Notes: A closer look at Gold price action sees XAU/USD trading within the confines of an ascending pitchfork formation extending off the March lows. A reversal off the upper parallel has price testing the weekly opening-range lows / median-line in early New York trade on Friday- look to the break for guidance with the broader advance at risk sub-1732 into the close of the week. A topside breach / close above the weekly highs needed to fuel the next leg higher in price with such a scenario eyeing subsequent resistance objectives at the 2012 high at 1795
EURO TECHNICAL PRICE OUTLOOK: EUR/USD WEEKLY TRADE LEVELSEuro updated technical trade levels & sentiment – Weekly ChartEUR/USD in consolidation within April monthly opening-rangeCritical support at 1.0657 – breach above 1.1187 needed to shift broader focus higherEuro is down nearly 0.6% against the US Dollar this week with EUR/USD trading at 1.0880 ahead of the New York close on Friday. The focus remains on a break of the April opening-range with price continuing to contract within the confines of well-defined technical levels. These are the updated targets and invalidation levels that matter on the EUR/USD weekly price chart. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Euro trade setup and moreNotes:In my most recent Euro Weekly Price Outlook we highlighted that the, “The immediate focus is on a break of the 1.0777-1.0977 range for guidance,” with our broader outlook still dependent on a hold above the March 2017 high-week close at 1.0657. A weekly reversal this week keeps price within the confines of the April opening-range heading into the close with Euro currently holding just above the 61.8% retracement of the late-March rally at 1.0831.Initial support steady at 1.0778 with a breach above 1.0976 needed to fuel the next leg higher in price towards key resistance at the 61.8% Fibonacci confluence zone at 1.1167/87 – a breach / close above this threshold would suggest a more significant low was registered last month with such a scenario exposing subsequent resistance objectives at the 100% extension at 1.1280 and the June 2019 high-day close at 1.1367. A weekly close below 1.0657 is needed to mark resumption of the broader downtrend towards the 2017 low-week close at 1.0532.
Therefore, optimistic equity traders might look to capitalize on the relative strength of the Aussie Dollar. Should risk trends continue, AUD/USD may probe overhead resistance once more, while support around 0.62 will aim to keep price afloat in the interim. Further still, IG Client Sentiment Data reveals retail traders just recently shifted their bias to the short side, suggesting continued AUD/USD strength may be ahead.
A summary of IG Client Sentiment shows traders are net-short EUR/USD - the ratio stands at -1.12 (47.18% of traders are long) – neutral readingLong positions are6.10% higher than yesterday and 12.29% lower from last weekShort positions are 6.11% higher than yesterday and 34.08% higher from last weekWe typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EUR/USD prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current positioning and recent changes gives us a stronger EUR/USD-bullish contrarian trading bias from a sentiment standpoint.
Evidenced in the chart below, the Australian Dollar has considerably outperformed the ASX 200 relative to one of the other leading risk assets, the S&P 500. Using the US index as a benchmark, we can see not only the divergence between the two Australian assets, but also the formidable strength of the S&P 500 which has outperformed both AUD/USD and the ASX 200 since mid-March.
AUD/USD has gained on hopes the world’s financial authorities are equal to the massive challenge of coronavirusHowever it may be that some doubts on this score are setting inThe currency could slip back if they get much deeperThe Australian Dollar has risen sharply through April, benefitting as have many other growth-correlated assets from the astonishing rescue packages launched around the world in an effort to cushion economies from the coronavirus’ effects.And yes, billions of dollars’ worth of extra liquidity is now ready to flood markets, very possibly, turbo-charging recovery. When it comes. However, it hasn’t come yet and most national economies remain in varying states of lockdown while the contagion continues to spread and forecasts of global recession spread almost as fast.HAS OPTIMISM BEEN OVERDONE?There are now signs of market fear that they may have overdone the optimism and, if they take deeper root, progress could be tough for the Aussie.There’s not a huge amount on the domestic data slate likely to deter investors from their broad focus on the coronavirus headlines worldwide. Tuesday will bring a look at the minutes of the last monetary policy meeting of the Reserve Bank of Australia which took place on April 7. Interest rates were held at their record lows back then, to the surprise of markets which had just about expected a further reduction to go with the two quarter-point trims made in March.However, it seems likely that the minutes will do no more than make it clear that all stimulus options remain on the table, and that will not add anything to what the market must already know. Investors will also get a look at the ‘trimmed mean’ quarterly inflation numbers, a curtain raiser for the full official release which will come toward the end of the month. Stickily low inflation was a key barrier to higher interest rates in the pre-Covid days but, as rates are likely to remain constrained for some time in any case now, the numbers may lose a bit of their bite.Skilled vacancy data for March could attract more attention than usual given that official jobless data for the month held up astonishingly well. It’s likely that this merely reflects a survey period which expired before virus-linked travel bans and shutdowns were imposed, but the labor market is in special focus now.Barring some unpredictable bit of left-field good news it seems likely that the Australian Dollar could struggle this week, so it’s another bearish call.
AUSTRALIAN DOLLAR & ASX 200 PRICE OUTLOOK: AUSSIE LEADS RECOVERY BUT STOCKS LAGThe Australian Dollar has charged higher in recent weeks as it continues to recover lost ground from the abrupt declines suffered across all risk assets in late February and much of March. Now more than 13% off its March 18 low, AUD/USD has been a leader among growth-sensitive markets but its equity counterpart, the ASX 200, has lagged comparable indices in other developed regions.ASX 200 PRICE CHART: INDEX LAGS INTERNATIONAL COMPETITION
Overall, AUD/USD is trending upwards. Recently, AUD/USD tested and failed to break below the key level of 0.63.Currently, AUD/USD is moving towards the key level of 0.64. Its next support level is at 0.61800 and the next resistance level is at 0.64200.
Related product：Crude Oil
Market analysis：Saudi's National Sovereign Wealth Fund, the Public Investment Fund (PIF), reportedly purchased US$ 1 billion shares of major European oil companies in a bottom-fishing attempt.
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Market analysis：The U.S. dollar drifted sideways in early trading in Europe on Friday, amid signs of increasing risk appetite in Europe as investors looked for the end of the coronavirus outbreak.At 3:35 AM ET (0735 GMT), the U.S. Dollar Index, which tracks the greenback against a basket of six other currencies, stood at 100.17, up 0.1%, while EUR/USD rose 0.1% to 1.0840 and GBP/USD fell 0.1% to 1.2445. USD/JPY fell 0.2% to 107.72.
Market analysis：Small loss if ever the price goes back against my entry. I'm gonna hold this trade. The market has been slow for me this week. #Forex
Market analysis：Results from yesterday's trading.Phidcon Signals always on point!!!Don't sleep on this!!!#kwam1 Kano#forexsignals #forex
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Market analysis：Overall, USD/CAD is trending downwards. Recently, USD/CAD moved lower, breaking below the key level of 1.41000.Earlier today, Bank of Canada (BoC) governor Stephen Poloz said that the Canadian economy is being hit by two factors, the Covid-19 pandemic and the plunge in oil prices. He also highlighted that even without the pandemic, BoC would still have cut interest rates in response to the plunge in oil prices.USD/CAD’s next support level is at 1.39800 and the next resistance level is at 1.42250.
Market analysis：Overall, NZD/USD is trending upwards. Recently, NZD/USD moved higher into the key level of 0.60.The New Zealand CPI q/q data (Forecast: To Be Announced, Previous: 0.5%) will be released next Monday at 0645 (SGT).NZD/USD’s next support level is at 0.58400 and the next resistance level is at 0.60300.NZD/USD Outlook (17 April 2020)
Market analysis：Overall, AUD/USD is trending upwards. Recently, AUD/USD tested and failed to break below the key level of 0.63.Currently, AUD/USD is moving towards the key level of 0.64. Its next support level is at 0.61800 and the next resistance level is at 0.64200.
Market analysis：Overall, GBP/USD is trending upwards. Recently, GBP/USD tested and rejected the support level of 1.24400.Earlier today, UK Foreign Secretary Dominic Raab announced that the lockdown measure will continue for at least the next three weeks as easing the measure now will risk putting public health and the economy in jeopardy.Currently, GBP/USD is testing to break above the key level of 1.25. Its next support level is at 1.24400 and the next resistance level is at 1.26000.
Market analysis：Overall, USD/JPY is trending downwards. Recently, USD/JPY tested and bounced off the support level of 107.300.Currently, USD/JPY is moving towards the support level of 107.300 and the next resistance level is at 109.000.
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