Market News and Charts for February 25, 2020
Hey traders! Below are the latest forex chart updates for Tuesday’s sessions. Learn from the provided analysis and apply the recommended positions to your next move. Good day and Good Luck!
EUR/BRL
The pair failed to break out from a major resistance line, sending the pair lower. The United Kingdom, once an EU member state, was now a competitor of the largest trading bloc. As Britain departs from the European Union, it began seeking bilateral agreements with non-EU countries. Among the countries who pledged a post-Brexit trade agreement with the UK was its former colonies – Australia, Canada, and New Zealand. Brazil, who is currently negotiating with the EU, plans to also sign a similar trade deal with the United Kingdom. Analysts see Brazil’s move to further weaken the single currency. Germany, the bloc’s economic powerhouse, published a zero (0) percent growth for the fourth quarter of 2019. Meanwhile, Brazil’s foreign exchange inflows are increasing. Last week, there was a recorded $1.88 billion inflow in the Brazilian economy. On Just last month, the net outflow in Brazil was $16.10 billion.
USD/BRL
The pair will reverse back and break down from a steep uptrend channel support line. The Brazilian real is gaining altitude after the US reopened its market to Brazilian beef exports. This is another boost to the agricultural sector of Brasilia. In 2019, the country became the beneficiary of then escalating US-China trade war. During its height, Brazil accounted for 80% of total Chinese soybean imports. Aside from this, the largest car manufacturing company in the United States is planning to build its Gigafactory 6 in Santa Catarina. Tesla is expanding at a fast pace following its successful introduction of Gigafactory 3 in Shanghai, China. It is also currently building Giga 4 in Berlin, Germany. Along with Santa Carina, CEO Elon Musk is planning to build a Gigafactory in Texas. If the two (2) cities approved Tesla to build a Gigafactory in these cities, Musk will have a total of 6 Gigafactory in the world.
USD/RON
The pair will bounce back from its previous resistance line, pushing the pair higher towards a major resistance line. Romania is set to benefit from the fallout of the US-Turkey relationship and from the escalating US-Russia tension. The US deployed additional military personnel in Romania along with THAAD (Terminal High Altitude Area Defense). Moreover, the country became the new recipient of the F-35 fighter jets. The increase in US visibility in the country will also increase the demand for the US dollar. Recently, Transgaz, the state-controlled oil company of Romania, joined the US-led LNG (liquified natural gas) network. This was in addition to Romgaz, another state-owned company, who participated in a Greek-American project for a floating LNG pipeline. The militarization and increase economic cooperation of America to the eastern bloc was its response to the growing military influence of Russia in Europe.
EUR/NOK
The pair will reverse back after a series of rally, sending the pair lower towards a major downtrend support line. The European Union in under pressure from the possibility of the United Kingdom joining the European Economic Area (EEA). The EEA is comprised of non-EU European countries. The group has a free movement agreement with the European Union, which will give the UK an upper hand against the EU. When Britain left the trading bloc, it also withdraws from the free movement agreement with other EU-member states. This means that British citizens will need a visa when travelling to the EU countries. Norway is one step ahead of the European countries. Three (3) days before the UK leaves the EU, Norway signed its own Brexit deal with the United Kingdom. The weakness of the trading bloc will spell trouble for the euro and thus will be beneficial to other European currencies like the Norwegian krone.
