Risk on before the start of the European session, safe haven assets give way

Risk in the European premarket, with futures of European indices pointing to a higher opening. DAX futures were up 0.55%, UK100 0.63%, EU50 0.60% and FRA40 0.62%.

Despite two coronavirus deaths outside China, markets also focus on the potential resilience of the global economy against the effects of the virus. At the local and global levels, the economy is in good shape. This leads investors to believe that when everything is gone, the economy will withstand the reverberating negative effect.

In currencies, AUD leads against the dollar on the FX front and remains the strongest currency so far with growth against USD of 0.43%. The RBA left interest rates as expected and the bank indicated that it had ended its interest rate cuts at this stage. The euro is virtually unchanged and the yen, along with gold, are inferior to the US dollar.

The pound has successfully found support in the area at 1.29900, with the price trying to keep above 1.30000. Brexit may already be fulfilled, but the next difficult step is to come, namely the trade deal with the EU.

Bitcoin cannot go above $ 9500. Risk on sentiment pulls the price down. The area remains key to continue the upward movement.

Given the light economic calendar today, we expect investors to trade riskier. However, sentiment remains uncertain and heavily influenced by news about the coronavirus.

 Trader Martin Nikolov

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