STATE OF THE MARKETS
Equities on panic attack as new corona strain emerged. Global equities suffered a set back as new strains of the corona virus was reported in the United Kingdom. The decision to lockdown England on late Sunday, spurred a panic attack in Asia leading to abandon of high beta assets and flight to the safe-haven Dollars. The benchmark US 10Y yield, fell more than 50 basis points on the news, before climbing back to settle around the open, 0.94%.
Crude gapped down on the open, dived to as low as $46.25/barrel before settled around $47.80 as investors worry a second lockdown will be imposed globally and travel restrictions would hurt demand for the black gold. The yellow metal gold on the other hand, was seen in a whipsaw before closed with bearish uncertainties around $1,876.21/oz.
King Dollar finally made a come back with the Dollar index (DXY) closed above the 90 handle after being pushed down from as high as the 91 handle. The reserve currency seems to be on continued support from the Loonie in the medium term as it flipped to demand in the short-term. Commodity currencies suffered major setback on the break of the new corona saga, while as of US market close, Euro was seen leading the demand in the short-term.
G8 CURRENCIES SENTIMENTS
** ST refers to Short-Term which is daily turnover, MT is Medium Term which is
weekly and LT refers to Long-Term which is monthly turnover.
WALL ST MOST ACTIVE
|VOLUME||90 DAYS AVG|
** % Change here refer to price vs previous day price
WALL ST TOP FLOWS
|% CHANGE||FUNDS FLOW $|
** % change here refers to volume vs. 20 days average volume.
TOP 5 BLOCK ORDERS
|SI||26.395 – 27.18||silver futures||370||50.1M|
|CL||46.00||crude oil futures||300||13.8M|
OUR PICK – NZD/USD
Flight to safe-haven Dollars would hurt Kiwi the most. If the current trend continues and the new strains of corona virus is far deadlier and more contagious than the originals, then the primary casualties are the commodity currencies particularly the Kiwi. This pullback, if happen is also timely for the 5 motive waves higher from March low. Assuming fractal is correct and the top is already in place for December, then we should see a corrective waves lower to test 0.6800 in the medium-term. 0.7120 is pivot and the exchange rate should not closed above it on the daily for this trade idea to be valid.
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