Sentiment tends to risk on before the European session begins. The futures of major European indices point to a higher opening. Yesterday’s good data on the US economy and the news that every effort was made to limit the spread of coronavirus pushed the US indexes from their bottom. Asian markets followed them, and now it is the turn of the European countries to take a rest.
DAX’s futures are up 0.4%, with the price holding above the 50-period moving average. The price is still far from covering the gap of the 27th, but with the risk of sentiment we will expect it to happen at a fast pace.
The Japanese yen remains strong against the US dollar, holding above 109, but movement is curtailed because buyers try to keep risky assets high. Due to the safe haven assets, gold is with minimal changes but remains in negative territory with a decrease of 0.17%. The Swiss franc is also inferior to the US dollar, but is approaching a key resistance in the area at 0.97450 – 500.
The euro is inferior to the US dollar, expecting a new zone test at 1.1000 for a breakthrough.
BRENT and WTI are holding rises of close to 1% as raw materials attempt to solidify their repulsion.
Today’s economic calendar is not filled with many events, but the main focus of the markets will be FOMC at 21:00 – the report, the decision on interest rates and the press conference at 21:30.
We expect European trade to remain risky, with markets now focusing on FOMC. This does not mean, of course, that investors do not have one in mind about the virus. On the contrary. Trade with caution and follow the news.
Trader Martin Nikolov