Asian indices managed to recover from early losses and end mostly higher after a sharp drop in Wall Street yesterday. The Fed’s bazooka failed to calm investors yesterday as the coronavirus outbreak impact increase global recession fears. In a coordinated move by central banks, the Fed, the Bank of Canada, the Bank of England, the Federal Reserve, the Bank of Japan, the European Central Bank, and the Swiss National Bank took action to enhance US dollar liquidity globally through existing dollar swap arrangements.
Nikkei 225 index finished 0.06 higher at 17,011. The Shanghai Composite index closed 0.35% lower at 2779. The Singapore FTSE Straits Times is 0.33% lower at 2487. Hang Seng in Hong Kong was 0.42% higher at 23171. The ASX 200 index recovered from yesterday’s sell-off and finished 5.83% higher at 5293.
European indices tumble on Monday trading. The German DAX is 7.80% lower at 8,514. CAC 40 index is 8.82 lower at 3,754, while the FTSE MIB in Milan is 7.93% lower at 14,650. In London, the FTSE 100 is 5.93% lower at 5,047.
In the commodities markets, the crude oil price rebounds after yesterday’s sell-off. WTI crude oil is 4.53% higher at $30.02 while the Brent oil is 4.77% higher at $31.02 per barrel.
The gold price is under selling pressure for one more day. As of writing, gold is 1.66% lower at 1488. The gold price immediate resistance stands at $1,703 the recent high, while the support stands at $1,481 the daily low. Silver price is 0.82% at $12.75.
Cryptocurrencies trading higher in early European session after the sharp losses the last trading days. Bitcoin (BTCUSD) is 6.61% higher at $5,370, hitting the daily low at $4,846 and the daily high at $5,407. Bitcoin’s technical outlook is clearly bearish as the cryptocurrency makes consecutive lower lows and lower highs. Immediate support for BTCUSD stands now at $4,431 the low from yesterday’s trading session. On the other side, the first resistance is seen at the 6,000 mark and then at 9,123 Friday’s high. The next supply zone will be met at 10,495 the yearly top.
Ethereum is 8.29% higher at 120.73, with capitalization at 12.92 billion. The first resistance for Ethereum stands at $123.81, the daily high, while the first support stands at $102.00 yesterday’s low. Ripple (XRPUSD) is 6.66% higher at 0.1511. Litecoin (LTCUSD) is 6.36% higher at 35.47. The crypto market capitalization stands now at $149.95 billion.
In the Lookout: Japan Industrial Production came in at 1% topping the expectations of 0.8% in January, the yearly reading came in at -2.3% above the estimates of -2.5%. The Japan Capacity Utilization registered at 1.1%, above expectations of -0.5% in January.
People’s Bank of China has set the Yuan (USDCNY) reference rate at 7.0094 versus yesterday’s fix at 7.0018.
Trading Perspective: In the foreign exchange markets, The Aussie is 1.70% lower at 0.6015 against the greenback. Japanese Yen is lower against the US Dollar. The U.S. dollar index is 1.10% higher at 99.20. NZDUSD trades 1.33% lower at 0.5961.
AUDUSD Slumps to 17-Year Lows
AUSUSD is under extreme selling pressure as the US dollar surges on funding stress across the globe. The coronavirus outbreak has triggered a global sell-off in risky assets as investors running for cover. The US dollar funding situation getting worst despite the intervention by central banks around the globe.
Earlier today reported that the Australia House Price Index (QoQ) came in at 3.9 in line with expectations for the fourth quarter, the yearly reading came in at 2.5% above the previous reading of -3.7%.
On the technical side, AUDUSD’s first support stands at 0.5992 the daily low which is also fresh 17-years low. The next support will be met at the 0.5950 mark. On the other hand, an initial resistance is seen at 0.6147, the daily top. More offers would be met at 0.6277 the high from yesterday’s trading session.
USDCAD Trades Higher Despite Fed Interest Rate Cut
USDCAD after a weak start on Monday jumped higher despite the emergency rate cut by the Fed yesterday. Federal Reserve, in a surprising move, cut the interest rate by 100 basis points to 0.0%-0.25% in an attempt to combat the coronavirus outbreak. Meanwhile, the crude oil price resumed downtrend as the recession fears increase, and the price is 8.29% lower at $29.14.
On the technical analysis, the outlook is bullish as the pair trades above all major moving averages. Turbulence in the crude oil and stock markets is USD positive and higher levels would be possible. The first resistance for the pair stands at 1.3923 the daily high. The next hurdle to the upside would be me at 1.3994 the high from Friday’s trading session. On the other hand, immediate support for USDCAD will be met at 1.3724 today’s low. The next support zone stands at 1.3680 the low from March 11.
