EUR/USD& Gold Near a Key Support Level Ahead of the US Elections

EUR/USD& Gold Near a Key Support Level Ahead of the US Elections

What moves markets today? Lockdowns, the US national polls, data release, or all of the above?

The Australian manufacturing PMI final numbers of October released earlier of 54.2 came lower than the prior read of 55.4. The released data did not have a noticeable effect on the Australian Dollar against major currencies.

Equities

Global stock markets closed on Friday the monthly candlestick in the red caused by reimposed lockdowns in Europe to the delay in the fiscal stimulus approval to the uncertainty of the US elections. All of these factors affected the market's risk appetite and pushed investors to safe havens.

The UK PM announced in the weekend a partial lockdown in England, while China resumes its economic recovery due to cheap oil prices. Eyes are focused on the US elections as polls in swinging states show a narrow difference between Trump and Biden, yet it favors somehow the Democratic candidate.

Stock Market

Change %

S&P 500

-0.2%

Dow Jones

+0.06%

NASDQ

-1.3%

Japan 225

-0.3%

DAX 30

+0.1%

FTSE 100

+0.1%

CAC 40

+1.2%

EUR/USD and Main FX Markets

The greenback benefited from the risk-off sentiment and recovered the previous week’s losses. The US Dollar index closed the monthly candlestick with a bullish Doji candlestick highlighting the market’s indecision. On Monday, the US dollar rallied even further to a five-week high at 94.29. A close above 94.95 would change the US dollar index from neutral to positive.

The EUR/USD traded lower eyeing a test of the current 1.1621- 1.1909 trading zone. A close below this level could send the price even lower towards 1.1459.

The British Pound retreated due to expectations of lower growth of the UK economy caused by the newly imposed lockdown in England. The GBP/USD slipped on Monday by 0.5% eyeing a test of 1.2804. A Further break below this level could send the price towards 1.2773.

Gold and Oil

The oil price opened this week with a downward gap caused by weaker demand expectations as some states in Europe like Germany and France closed their economy partially. The Brent Crude could be on the way for a test of $35.00 a barrel, while the US oil may drop towards 31.50.

The Gold price rebounded last week from $1,859 and kept its neutral outlook. The price could be on the way for a test of $1,921. That said, a close below $1,861 changes the technical outlook to negative and could send the price towards $1,796.

Looking Ahead

The EUR/USD and Gold traders will be checking the Canadian manufacturing PMI final number of October at 3:30 PM (GMT) then theUS manufacturing PMI final number of October at 4:00 PM.

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