Weekly Preview: Technical analysis on USDJPY, GBPUSD, USDCNH, XAUUSD, WTI, SPX
Safe haven currencies such as JPY, Gold, and CHF extended their rally as investors flock to them for shelter, driven by the increasing number of Covid-19 cases worldwide, with an exception of the USD which skydived after the market priced in a 50% chance of a 75 bps FED rate cut in 2020. Meanwhile, VIX index, a proxy for fear has also surged near the 40.00 handle, the highest level since February while the SPX wiped out about 10% from its all time high, suggesting that carry trades are becoming increasingly risky. This explains the ballistic move that we are seeing across EUR, CHF and JPY pairs. Looking ahead, given that the Covid-19 has evolved into a global crisis, the risk off market appetite could be here to stay as we assess the extent of the global economic impact as a result of the Covid-19 outbreak.
CURRENCY: USDJPY
USD/JPY Chart
Chart by TradingView.com
Price is facing bullish pressure from our first support where we could see a bounce above this level to our first resistance level. Stochastic is showing signs of oversold as well.
CURRENCY: GBPUSD
GBP/USD Chart
Chart by TradingView.com
Price is facing bullish pressure from our first support where we could see a further push up to our first resistance level.
CURRENCY: USDCNH
USD/CNH Chart
Chart by TradingView.com
Price is facing bullish pressure from our first support where we could see a bounce above this level to our first resistance level. Stochastic is showing signs of oversold as well.
CURRENCY: SPX
SPX Chart
Chart by TradingView.com
Price is facing bearish pressure from our Ichimoku cloud, 20 EMA and our first resistance level. A break below our intermediate support level at 2988.2 could see a further drop to our first support level.
CURRENCY: XAUUSD
XAU/USD Chart
Chart by TradingView.com
Gold made a pull back after reaching a 6 year high at 1689.34. Price holding and reacting below key resistance at 1658.55. A short term, limited push down towards support at 1613.03 can be expected. Price holding below moving average and MACD indicator has turned down and looks to be crossing below 0, into the bearish territory.
CURRENCY: WTIUSD (USOIL)
WTI/USD Chart
Chart by TradingView.comChart by TradingView.com
WTI drifted lower over the course of the week. Now, price is holding between support at 44.29 and resistance at 48.16. Given the over-extended downwards move, price could start moving sideways next week. Technical indicators are mixed as well, with price holding below ichimoku indicator (bearish sentiment), yet stochastic is testing support where price bounced above before.
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