ZuluTrade Blog

COVID-19 fear is stalling the rally

Market View | Monday, June 22, 2020 11:23 AM GMT

Most markets performed a full or partial V recovery after the sell-off due to coronavirus pandemic. The Investors appreciated the generous financial packages from the majority of central banks around the globe. Nevertheless, the virus is still here as no treatment has been yet discovered. Yesterday WHO announced the biggest rise in infections on a single day as 183,000 new cases reported. 

Brazil is leading with 57k cases while US is coming second with 36k. Worth mentioning, Brazil is the second-largest country in deaths as they are reporting near 50k cases.

Additionally, Germany reported that its reproduction rate increased higher (up to 2.88) than the key containment level. The desirable number is lower than 1.    

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Asian Market closed mostly in red even if China left the benchmark loan rate unchanged at 3.85% while the 5-year LPR at 4.65%. But it seems that traders have already discounted this move and SHANGHAI 50 ended with soft losses (-0.27%). Kospi fell by 0.68% as North Korea warns for “retaliatory punishment” for South Korea because they blame Seoul for an anti-Korea leaflets campaign. 

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EU markets have opened in negative territory following the coronavirus fears. DAX, CAC, and FTSE are recording soft losses while they all consolidating in the daily timeframe anticipating a new catalyst event. 

Heading to the forex market, EURUSD is still moving within the short-term falling wedge and still above the 1.1146 level. GBPUSD is reversing from the last lows and is heading to the 1.2434 resistance level and near to the 20SMA. USDJPY is moving sideways near lows and still looks bearish according to the MAs.

EURUSD daily chart

GBPUSD daily chart

USDJPY daily chart 

Checking the ZuluTrade’s Traders Sentiment, the community is currently bearish on EURUSD while bullish on USDJPY, USDCHF, GBPJPY, and UDCAD.

In focus this week (economic calendar):

EuropeanMonetaryUnion - Markit PMI Composite (Jun)
NewZealand - RBNZ Interest Rate Decision
EuropeanMonetaryUnion - ECB Monetary Policy Meeting Accounts
UnitedStates - Initial Jobless Claims (Jun 19)


The views expressed do not constitute investment or any other advice /recommendation /suggestion and are subject to change. Reliance upon information in this material is at the sole discretion of the reader. Opinions expressed in the report do not represent the opinion of ZuluTrade Social Trading Platform and do not constitute an offer or invitation to anyone to invest or trade.

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