Hey traders! Below are the latest forex chart updates for Thursday’s sessions. Learn from the provided analysis and apply the recommended positions to your next move. Good day and Good Luck!
GBP/CHF
The pair failed to break out from a key resistance line, sending the pair lower towards its previous low. The United Kingdom is set to publish several major reports today. Analysts were expecting the country to post disappointing figures for March as coronavirus infected the global economy. For its gross domestic product (GDP) month-over-month (MoM) report, the country will publish negative growth. The lockdown in Britain will further drag the zero percent GDP MoM growth for March to negative territory. The same is true for the UK’s Industrial and Manufacturing Production reports. As the European region faces an increase in the number of coronavirus cases, the safe-haven appeal of the Swiss franc is shining throughout the market. Switzerland is among the 3 countries in the world and 2 in Europe with a negative interest rate. This will attract investors looking for economies who are willing to support their local businesses.
EUR/AUD
The pair will continue to move lower in the following days towards a major support line. Divisions inside the European Union became more visible following the coronavirus outbreak. EU finance chiefs failed to agree on the $540 billion funds for the emergency package. On the 16-hour teleconference, finance ministers failed to reconcile their views on how much each country should contribute to the funds.
Larger economies like Germany and France are called out to contribute a bigger amount to the funds. However, finance ministers in each respective country argued that they are struggling with their economy. Hence, bigger funding is not feasible for them. In Germany, a €1 trillion fund was already allocated to fight the economic impact of COVID-19. This represents more than a quarter of the country’s GDP. Moreover, Germany and France are also facing recession in the first quarter of 2020.
EUR/USD
The pair will continue to move higher towards a key resistance line. The United States is set to release last week’s jobless claims report. For the past 2 weeks, figures for the report continue to break records with 3.3 and 6.6 million jobless claims, respectively. This week, however, the US forecasted that claims will go down to 5.3 million. Despite this, analysts already cast doubt over the forecast as the past 2 weeks have also underestimated the number of jobless claims.
In other news, the US Congress and US government is already preparing their phase four stimulus package. This could further drag the value of the US dollar but will be outweighed by the demand for cheap dollars. Meanwhile in Europe, finance ministers of the largest trading bloc failed to agree on the emergency fund. Political analysts see this as a possible reason for more EU member states to leave the bloc. Moreover, without the UK in the bloc, emergency funds are expected to be lower.
USD/JPY
The pair will continue to move higher to retest its previous high. Investors and traders are selling their holdings of Japanese assets. This was following PM Shinzo Abe’s declaration of a “State of Emergency”. Moreover, investors are skeptical with today’s reports on Bank Lending YoY and Producer Price Index. Businesses will opt to close their business compared to making loans from banks as the general public are encouraged to stay at home. Abe also unveiled the country’s largest stimulus package in history at $555 billion to ease the crisis.
The same thing is true in the United States. Most states already ordered their constituents to stay at home as the country recorded 2,000 coronavirus related deaths 2 days in a row. The US Congress and the government already signed the $2 trillion stimulus package to aid businesses. Also, these institutions are now preparing their phase four stimulus as the country continues to record an increase in jobless claims. Analysts are seeing more drastic measures to increase liquidity in the market.
