Market News and Charts for July 08, 2020
Hey traders! Below are the latest forex chart updates for Wednesday’s sessions. Learn from the provided analysis and apply the recommended positions to your next move. Good day and Good Luck!
The pair will bounce back from a key support line, sending the pair higher towards a key resistance line. Switzerland posted a modest decline on its unemployment rate today, July 08, for the month of June. Figure went down by 0.1% to 3.3%. However, this is not enough to keep the Swiss franc from pushing the British pound lower in the coming sessions. Meanwhile, Rishi Sunak, UK’s finance minister, unveiled the government’s latest stimulus package worth $3.76 billion. The money will be used as a tax break among local restaurants to lessen the impact of the pandemic and to keep their businesses afloat. This, in turn, will support the pound sterling in short to medium-term. However, analysts believe that the UK currency will decline in the long run due to the Brexit transition. Cases of COVID-19 in Britain continue to soar and Boris Johnson faces pressure on whether to prioritize the Brexit transition or fight the coronavirus pandemic.
The pair will bounce back from a “Falling Wedge” pattern support line, sending the pair higher. Germany, France, and Italy are leading the recovery of the eurozone. Germany posted a positive figure for the Industrial Production report following two (2) consecutive declines. The recorded growth was at 7.8% in May compared to -17.9% in the prior month. France’s Imports and Exports also picked up from their decline in April. Meanwhile, the hardest hit country in Europe by the coronavirus pandemic is now starting to recover. Italy’s Retail Sales report saw a massive gain of 24.3%. Just like in the European Union, analysts are also bullish on Australia’s recovery. However, this recovery is expected to be slower than the EU. It was projected that Canberra will have a U-shaped recovery while its neighbor New Zealand will have a V-shaped recovery. Maintaining the country’s interest rate at 0.25% is not helping the recovery either.
The pair will continue to move higher in the following days and revisit its March 2020 high. Americans refused to spend money even on essential goods during the pandemic as shown in the recent Consumer Price Index (CPI) report. Figure was at -0.1%, which indicates that people living in the United States are trying to save as much as they can during the pandemic. This is true given that the US government was not able to contain the virus yet and there is no end in this crisis at hindsight. This, in turn, is hurting the country’s economic activity and affecting the value of the US dollar. Meanwhile, once the epicenter of the coronavirus pandemic, Europe is now recovering from the economic impact brought by the virus. Germany, France, and Italy lead this recovery, all of whom were members of the eurozone. If the situation in the US and the EU continues, investors should expect the single currency to further increase against the greenback.
The pair bounced back from a major support line, sending the pair higher towards a major resistance line. The impact of the coronavirus pandemic is being felt in Japan as it releases key reports affecting its economy. Japan Household Spending report dropped down by 16.2% on a year-over-year (YoY) basis. Meanwhile, overtime pay plunged by 25.8%, the biggest since the 2008 Global Financial Crisis. Also, foreign investment in Japanese stock and bonds also showed negative figures at -77.0 billion and -522.8 billion, respectively. However, business failures will push the Japanese yen to record lows. Corporate bankruptcies in June grew by 6.3% and analysts are expecting that the numbers will continue to grow until the country was able to eliminate the threat of the virus. During the period of Japan’s national emergency, the government unleashed more than $1 trillion in stimulus packages to help its economy cope up with the pandemic.
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