After a few days of relative calm and sustained recovery, major indices start losing value yet again
The 2 Trillion-dollar stimulus package was approved by the US Congress, only Trump's signature is needed to validate it, but it has not been enough for the stock markets to continue to rise
The leading indices, both American and European, lost an average of 2%. The evolution of the numbers of those affected by the Coronavirus is the main concern of investors at the moment and still guides the movement of the main market assets.
The Central Bank of Canada cut an additional 50 points in interest rate, and Governor Poloz announced that they are ready to continue supporting the economy by all possible means.
The Canadian Dollar was heavily sold after the announcement of the measure taken by the central bank but ended the day recovering part of those losses, all this although BrentOil, with a high correlation with the Canadian currency, continued to lose value until reaching minimums not seen since 2004, below which there would be no supports up to the area of $20.
This downward trend in Oil will put further pressure on the Canadian Dollar according to the opinion of the majority of the market analysts, and the CAD/JPY pair will be the most affected since the Yen buying flows remain active in this risk-off scenario in which Japanese investors are repatriating much of their investments abroad.
The primary support of the pair is in the 76.00-76.15 band below, which opens the way towards 75.00 and 74.20.
The US Dollar also has continued its downward trend against all currencies except the Canadian Dollar, and, as pointed out in the recent past, it has lost its safe-haven currency status.
EUR/USD surpassed the 1.1100 level above the 100 and 200-day SMA that strengthen the bullish momentum.
USD /JPY lost almost two figures on the day and needs to break the supports located at 107.70, 38.2% Fibonacci of the last bullish leg and 107.45 100 SMA to make its way down to 105.25
The Sterling Pound kept its momentum on the upside. GBP/USD gained three figures on the day, while EUR /GBP broke the descending triangle formed the previous day and fell down to 0.8904. It finds minor support in the 0.8880 zone, but below it has no obstacles in its fall until around 0.8700.
By: Miguel A. Rodriguez Ruiz
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