18 May 2020 Morning Session Analysis
Dollar drops as stimulus plan passed in US House of Representative.
Dollar index which gauges its value against a basket of six major currencies slumped following US House of Representative approved the new round of stimulus program on last Friday. Since the outbreak of Covid-19, US government and Federal Reserves had cooperated to implement different types of stimulus program in order to relief the pressure of this pandemic toward the local businesses and household. Hence, this round of new relief program which amounted to $3 trillion also serves the same purposes of combating the negative effect of virus against US economy. However, this relief package is expected to face barrier and likely unable to get the final approval in the level of House of Senate as majority members of the Republican Party disagree to this new aid package. Besides, US white house also revealed that he will veto the plan as the measure’s design is unsuitable to US economy. Nonetheless, a new round of relief package can be foreseen in the upcoming weeks as Trump’s tone showed his support toward an implementation of new stimulus program. As of writing, dollar index drops 0.02% to 100.35.
In the commodities market, crude oil prices soars 2.95% to $30.40 per barrel as investor confidence toward this black commodity market rose following hawkish tone from OPEC. In an interview with Bloomberg, OPEC secretary Mohammed Barkindo revealed that worst oil crisis has over and it is behind the world now. Besides, gold prices appreciate by 0.40% to $1750.20 a troy ounce amid weakening of dollar index.
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Technical Analysis
DOLLAR_INDX, Daily: Dollar index was traded higher following prior breakout above the previous resistance level at 99.75. MACD which illustrate bullish bias momentum with the formation of golden cross suggest the pair to extend its gains toward the resistance level at 100.85.
Resistance level: 100.85, 102.90
Support level: 99.75, 98.30
GBPUSD, H4: GBPUSD was traded lower following prior breakout below the previous support level at 1.2115. MACD which illustrates bearish bias momentum suggest the pair to extend its losses toward the support level at 1.2010.
Resistance level: 1.2115, 1.2215
Support level: 1.2010, 1.1890
EURUSD, Daily: EURUSD was traded higher following prior rebound from the lower level. MACD which illustrate diminishing bearish momentum suggest the pair to extend its rebound toward the resistance level at 1.0830.
Resistance level: 1.0830, 1.0940
Support level: 1.0765, 1.0655
USDJPY, Daily: USDJPY was traded lower following prior retracement near the resistance level at 107.20. MACD which illustrate diminishing bullish momentum signal suggest the pair to extend its losses toward the support level at 106.25.
Resistance level: 107.20, 108.20
Support level: 106.25, 105.55
AUDUSD, Daily: AUDUSD was traded lower following prior retracement from the resistance level at 0.6555. MACD which illustrates bearish bias momentum signal suggest the pair to extend its losses toward the support level at 0.6370.
Resistance level: 0.6555, 0.6705
Support level: 0.6370, 0.6180
NZDUSD, H4: NZDUSD was traded higher following prior rebound from the support level at 0.5920. MACD which illustrates diminishing bearish momentum suggest the pair to extend its gains toward the resistance level at 0.5995.
Resistance level: 0.5995, 0.6065
Support level: 0.5920, 0.5850
USDCAD, H4: USDCAD was traded lower following prior retracement from the resistance level at 1.4120. MACD which illustrates diminishing bullish momentum suggest the pair to extend its losses toward the support level at 1.3980.
Resistance level: 1.4120, 1.4240
Support level: 1.3980, 1.3855
USDCHF, H4: USDCHF was traded lower while currently testing the support level at 0.9710. MACD which illustrates diminishing bullish momentum suggest the pair to extend its losses after it successfully breakout below the support level.
Resistance level: 0.9750, 0.9795
Support level: 0.9710, 0.9660
CrudeOIL, H1: Crude oil price was traded higher while currently testing the resistance level at 30.50. MACD which illustrate bullish bias momentum suggest the commodity to extend its gains after it successfully breakout above the resistance level at 30.50.
Resistance level: 30.50, 33.00
Support level: 28.75, 26.40
GOLD_, H4: Gold price was traded higher following prior rebound near the support level at 1738.15. MACD which illustrate bullish bias momentum signal suggest the commodity to extend its gains toward the resistance level at 1757.60.
Resistance level: 1757.60, 1766.35
Support level: 1738.15, 1726.05