Last week closed with the jobs market announcements in USA and results a bit better that expected since the Unemployment Rate in July dropped at 10.2%. Also, president Trump with four executive orders that announced tries to relief the COVID-10 wounded American economy but the number of cases keeps on increasing dramatically and during the weekend, it surpassed 18 million all over the world. USD recovered on Friday and limited a lot the weekly losses while EUR continued its bullish trend. The stock markets were profitable for one more week and the rally on gold continued impressively. It seems that the technological stocks rally has stopped for the moment because the recent USA – China tensions may affect this sector very much.
The current week will be quieter regarding the scheduled economic announcements but the news from COVID-19 and from the geopolitical tensions (USA – China) do not incline towards low volatility.
EURUSD (Euro vs US Dollar)
EURUSD had a bullish movement for one more week as it opened at 1.1770 and closed at 1.1786. Weekly profits were higher since last Friday (weekly high was above 1.19) where USD recovered. EURUSD kept on rising for the 7th week in a row but USD seems very under–priced because USD Index has lost more than 10% since the end of March which is not a very usual fact. Even if in a long—term period we have entered into a weak USD circle, we may see a reaction that may correct the big rise of the pair that we witness during the last months. We’ll take the risk with sell positions this week.
GBPUSD (Great Britain Pound – US Dollar)
Consolidative trends we saw last week for GBPUSD, since the pair opened at 1.3076 and closed at 1.3051 with significantly lower volatility, compared to the recent past. UK is trying to recover and to come back to normality in between COVID-19 new cases but a survey of 2,000 employers showed that one out of three UK companies is planning to decrease the personnel during the current quarter. On the other hand, we saw some positive statements from officers regarding Brexit but if a possible USD reaction causes a drop for the pair below 1.30 then we may see strong corrections. Ion the current week we need to put our eyes on the important UK announcements (Unemployment Rate and GDP) that indeed will affect the pair but having in mind what we mentioned before, we prefer sell positions.
USDJPY (US Dollar – Japanese Yen)
Slightly bullish was the last week for USDJPY which opened at 105.77 and closed at 105.92. The 10 years US yield is moving steadily around 0.57% confirming the pair’s consolidations but there is an optimism in the air after the positive US job market announcements and the recent executive orders by president Trump that may give a boost to USD. We’ll try buy positions this week even if the pair needs to have prices above 106.50 in order to have a solid bullish reaction.
EURJPY (Euro – Japanese Yen)
Another bullish week for EURJPY (the 7th in a row) with a weekly open at 124.53 and a weekly close at 124.84. This rise limited enough during last Friday as we saw a price correction from the weekly high above 125. There is a relative balance between the two currencies so we may see price consolidations around the critical zone at 125. Range strategies is our selection for the current week.
EURGBP (Euro – Great Britain Pound)
Marginally bullish closed the last week for EURGBP since it started a bit below of 0.90 and it managed to close at 0.9030. This weekly close gives a higher probability to the bulls so we’ll try buy positions this week but we need to have a breakout of 0.9150 before we can have a solid uptrend.
USDCAD (US Dollar – Canadian Dollar)
Slightly bearish was the last week for USDCAD, which opened at the price area of 1.34 and closed at 1.3383. The weekly low price was close to 1.32 since the rising oil prices helped the Canadian dollar but since last Thursday the outlook of USD changed and as it started to raise, the picture of the pair changed. This recovery may continue above 1.34 and this will give extra fuel to the pair and we we’ll take our chances by opening buy positions this week.
USDCHF (US Dollar – Swiss Franc)
The free fall of USDCHF carried on since the last Thursday where we saw low prices close to 0.9050 but the USD recovered and caused a weekly close at 0.9125. If we truly witness a USD recovery then the pair may take a few breaths after the heavy pressures of the last months. Even if it takes a bullish breakout of 0.9240, we will open buy positions.
AUDUSD (Australian Dollar – US Dollar)
The rise of AUDUSD carried on for the 7th week in a row and the pair closed at 0.7158, about 30 pips higher than the weekly open. The inflation in China just announced at 2.7% (better than expected) and the pair is holding 0.7150 but there are new dark clouds gathering between USA and China and in combination with a possible USD strength, may cause corrective trends to AUDUSD. We’ll take our chances with sell positions this week.
Strongly bullish was the last week for SP500 which closed at 3,347 points and profits close to 2.4%. We are now very close to the all–time highs of 3,400 points that we saw in last February and there are new positive messages after the relief package that president Trump announced. On the other hand, though, the new tensions between USA and China as well as the increased COVID-19 cases, produce serious concerns. Even if the approach of 3,400 points is tempting enough, many big investors already started to exit the stock markets and maybe the markets expects some triggers for corrections. Any such possible trigger will make us open short positions this week.
Bullish week for DAX30 with a weekly close price at 12,695 points, about 3.3% higher. This took place after two bearish weeks and it brought back the optimism for 13,000 points again since many investors consider that currently, the European stock markets is an opportunity. Long positions is our selection for the current week.
FTSE100 moved higher during the last week and closed at 6,025 points and profits that touched 2.8%. The close price above 6,000 points indeed creates many smiles and in combination with the underpricing conditions of the European stock markets may trigger scenarios for more bulls. That is why we will try long positions for this week.
The gold rally was unstoppable for one more week and the weekly close price was at $2,046 and profits close to 2.7%. The USD strengthening on Friday limited the profits because till that day we saw prices even above $2,088. The intense uptrend is undoubtable and it is based on the safe-haven assets attitude of gold in between the high money offering through all the recent fiscal packages. There is also the danger of a correction though because USD may recover and because many investors may take the (so far) important profits. We take the risk of being contrarians this week and we’ll try short positions.
The spot price of oil last week closed at $22.37 and the futures price was bullish in the same manner and closed at $41.55 with profits more than 3%. During the week we saw importantly higher prices that exceeded $43.50 but the USD strengthening and the increased COVID-19 cases do not allow a strong uptrend so most likely, oil will remain into the usual range between $40 and $43 for one more week. Our best option for this week is to use range strategy in order to open both long and short positions, according to the upper/lower band of the aforementioned channel.
Heavily bullish was the last week for Bitcoin with close price at $11,683 and impressive profits like 5.5%. The most impressive fact is that early this week, Bitcoin keeps on riding and it is already moving above $12,000. It seems that Bitcoin takes characteristics of a safe–haven asset in the world of digital currencies so the global concerns regarding COVID-19 and regarding a new cold war between USA and China in combination with ongoing fiscal packages, raise the price. If the price of Bitcoin stays above $12,000, maybe we’ll see $13,000 close enough so we’ll try long positions this week.