04 February 2020 Morning Session Analysis
Pound plunged amid to fears of “hard-Brexit”
Pound Sterling slumped on yesterday following risk upon the hard-Brexit escalated. On the Brexit front, the UK Prime Minister Boris Johnson set out tough terms for Brexit talks with the European Union, spurring fears that the UK would reach the end of an 11-month transition period without agreeing an efficient trade deal, reported by Reuters. In fact, UK Prime Minister Boris Johnson claiming that the Britain will not adhere to any of the European Union’s rules and regulation. On the other hand, the EU warned the UK that there would be 450 million people would be affected if UK does not adhere to such rules on environmental and labor regulations. If the “hard-Brexit” occur between the both countries, it would eventually destruct the economy growth of the both countries in term of future trade condition, which further spurring significant selloff for the Pound Sterling. Nonetheless, the investors would continue to scrutinize the latest updates with regards of the trade negotiations between the UK and Europe in order to receive a further trading signal. On the other hand, the Euro surged on yesterday following a positive manufacturing data from the Europe region was released. According to Markit Economics, Germany Manufacturing Purchasing Manager Index (PMI) increased from the preliminary reading of 43.7 to 45.3, exceeding the economist forecast at 45.2 while improving the market optimisms towards economic progression in the Europe region. However, the gains experienced by the Euro was limited amid the negative prospect for the trade negotiation between UK and EU. As of writing, GBP/USD surged 0.03% to 1.2995 while EUR/USD surged 0.03% to 1.1060.
In the commodity market, the crude oil depreciated by 0.01% to $49.88 per barrel. The oil market edged lower yesterday following the outbreak of the coronavirus as investors fear that the virus could diminish the future demand for this black-commodity. On the other hand, the gold price appreciated by 0.17% to $1578.68 per troy ounces amid to the risk-off sentiment in the market
Today’s Holiday Market Close
Time Market Event
N/A
Today’s Highlight Events
Time Market Event
N/A
Today’s Highlight Economic Data
| Time | Nation & Data | Previous | Forecast | Actual |
| 11:30 | AUD – RBA Interest Rate Decision (Feb) | 0.75% | 0.75% | – |
| 17:30 | GBP – Construction PMI (Jan) | 46.0 | 44.4 | – |
| 05:30
(5th) |
CrudeOIL – API Weekly Crude Oil Stock | -4.267M | – | – |
Technical Analysis
DOLLAR_INDX, H4: Dollar index was traded higher while currently testing the resistance level at 97.60. MACD which illustrated diminishing bearish momentum suggest the pair to extend its gains after it successfully breakout above the resistance level.
Resistance level: 97.60, 97.90
Support level: 97.25, 96.95
GBPUSD, H1: GBPUSD was traded lower while currently testing the support level at 1.2980. However, MACD which illustrated diminishing bearish momentum suggest the pair to be traded higher in short-term as technical correction.
Resistance level: 1.3085, 1.3145
Support level: 1.2980, 1.2915
EURUSD, Daily: EURUSD was traded lower following prior retracement from the resistance level at 1.1095. However, MACD which illustrated increasing bullish momentum suggest the pair to be traded higher in short-term as technical correction.
Resistance level: 1.1095, 1.1135
Support level: 1.1015, 1.0955
USDJPY, Daily: USDJPY was traded higher following prior rebound from the support level at 108.35. MACD which illustrated diminishing bearish momentum suggest the pair to extend its gains toward resistance level at 109.05.
Resistance level: 109.05, 109.60
Support level: 108.35, 107.90
AUDUSD, Daily: AUDUSD was traded lower while currently testing the support level at 0.6680. However, MACD which illustrated diminishing bearish momentum suggest the pair to be traded higher in short-term as technical correction.
Resistance level: 0.6745, 0.6790
Support level: 0.6680, 0.6630
NZDUSD, Daily: NZDUSD was traded lower following prior breakout below the previous support level at 0.6480. However, MACD which illustrated diminishing bearish momentum suggest the pair to be traded higher in short-erm as technical correction.
Resistance level: 0.6480, 0.6555
Support level: 0.6420, 0.6325
USDCAD, Daily: USDCAD was traded higher following prior breakout above the previous resistance level at 1.3245. However, MACD which illustrated diminishing bullish momentum suggest the pair to be traded lower in short-term as technical correction.
Resistance level: 1.3320, 1.3410
Support level: 1.3245, 1.3165
USDCHF, H4: USDCHF was traded higher while currently near the resistance level at 0.9670. MACD which illustrated diminishing bearish momentum suggest the pair to extend its gains after it successfully breakout above the resistance level.
Resistance level: 0.9670, 0.9715
Support level: 0.9625, 0.9585
CrudeOIL, Daily: Crude oil price was traded lower following prior breakout below the previous support level at 52.20. However, MACD which illustrated diminishing bearish momentum suggest the pair to be traded higher in short-term as technical correction.
Resistance level: 52.20, 54.95
Support level: 47.20, 43.20
GOLD_, H4: Gold price was traded lower while currently near the support level at 1576.35. Due to lack of signal of MACD, it is suggested to wait for further confirmation before entering to the market.
Resistance level: 1592.00, 1609.60
Support level: 1576.35, 1561.50