Lately last week, the US presidential elections thriller came to an end and despite the possible reactions of Donald Trump, Joe Biden should be considered the next president of the United States. Last week’s uncertainty though had a negative effect to USD, until last Friday where the news from NFPs were positive: 6.9% in October vs expectations for 7.7%. As per the COVID-19 issue, most of the European countries are in lockdowns but this fact did not stop EUR from rising. Stock markets had an impressive profitable comeback, so did gold and oil.
This week will be quieter and more calmed in USA and abroad (we cannot exclude reaction on the elections result from Trump though) and as per the scheduled economic announcements, the most important are GDP in Eurozone and UK as well as the Consumer Price Index in China, Germany and USA. In any case. news & updates regarding COVID-19 will affect the markets and the risk mood of the investors.
EURUSD (Euro vs US Dollar)
Important rise had the EURUSD pair last week, by opening at 1.1646 and closing at 1.1874. US media already call Joe Biden the new president of the United States but last week’s uncertainty had the result the weakening of USD. Now the price area of 1.20 is visible again for the pair although many times such sharp bullish trend lead to corrections. After the return to normality in USA, the package of the new economic aid will return again as well as the announcements of the new president which mainly concern higher taxes for the rich. This week will be indeed quieter regarding announcements and fundamentals and it will be likely dominated by the COVID-19 news and the lockdowns. The technical outlook of EURUSD is for an uptrend but we won’t be surprised if during the week we’ll see risk-off mood and USD strengthening as a safer solution. Our selection for this week is to open buy positions.
GBPUSD (Great Britain Pound – US Dollar)
Bullish was the last week for GBPUSD, by opening at 1.2921 and closing at 1.3149. The weakness of USD dominated against the stagnation of Brexit negotiations which entered in it the last week. UK remains in a lockdown and the current week has important news such as the announcements for the Unemployment Rate, the GDP and the speech of Andrew Bailey (bank of England). Any possible positive news regarding Brexit negotiations may cause a rally on the pair, up to the price area of 1.3350, maybe more, but a possible strengthening of USD could stand as a counterweight. We’ll prefer buy positions this week, trusting that good news from Brexit may come soon.
USDJPY (US Dollar – Japanese Yen)
Important drop for USDJPY last week, with a weekly open at 104.51 and a weekly close at 103.36. The pair’s price was the lowest since the beginning of March, to an area below 104. The 10 years US treasury yield fell to 0.83% (even if it tried to recover by the end of last week) but the most important reason of the pair’s outlook was the weakness of USD. USDJPY has characteristics of a downtrend and if there is a breakout of the last week’s low at 103.17, then the pair may drop below 103. We believe that this scenario is possible enough so we’ll open sell positions this week.
EURJPY (Euro – Japanese Yen)
Bullish reaction we saw for EURJPY last week. The pair opened at 121.73 and closed on Friday at 122.73. Currently, it is already moving around the area of 123 but it may turn to bearish in a case of a risk–off mood amongst the investors due to COVID-19 and the relative lockdowns. In such case, the first support exists at 122.49 and below that, at 121.60 and these will be the main target for our sell positions this week.
EURGBP (Euro – Great Britain Pound)
Slightly bullish was the last week for EURGBP which opened at 0.9008 and closed at 0.9028 but the volatility was not low accordingly. The important fact is that the pair persists in remaining above 0.90, which of course may change in the case of a sense for a Brexit agreement. Below 0.90, EURGBP may stop for a while (in a case of a downtrend) at the support of 0.8860 which is 6 months low for the pair. Sell positions is our selection for the current week, believing that an agreement regarding Brexit is possible enough.
USDCAD (US Dollar – Canadian Dollar)
It was a strongly bearish week for USDCAD in between the weakness of USD and the recovery of the oil prices. The pair opened at 1.3315 and closed at 1.3061, approaching enough the multi-month support at 1.2994. It makes perfect sense to see bullish reaction at this price zone (even temporary) since the area of 1.30 is a strong support for many reasons for USDCAD even if the momentum of the pair is definitely for more bears. We’ll try sell positions of we find out that the pair is below 1.30 for good but in an opposite case, we prefer buy positions.
USDCHF (US Dollar – Swiss Franc)
Important drop took place for USDCHF last week since the pair opened at 0.9158 and closed at the price area of 0.90. Early this week, it is already moving below 0.90 and as long as it stays there, the probability of more losses is higher. On the contrary, a possible recovery above 0.90 will trigger new buyers and a possible return to the price area of 0.91. This scenario seems more reasonable to us so we’re keen to open buy positions above 0.90.
AUDUSD (Australian Dollar – US Dollar)
AUDUSD followed the road of the weak USD and moved bullishly last week, opening at 0.7023 and closing at 0.7261. The multi-month lockdown in Australia seems to had some results because the new cases number is low. Also, the Australian Interest Rates remained unchanged at 0.1% RBA connoted new QE through bond markets. AUDUSD has characteristics of an uptrend (already touched 0.73) but the very strong & important resistance at the price area of 0.74 (which is two years high) limits the case of an extended rise. In any case, we prefer buy positions this week.
Strong rally for many US stocks last week (Facebook, Apple, Amazon, Microsoft etc) so SP500 closed at 3,509 points with important profits like 7%. Early this week, the futures of the Index perform further profits and the all–time high at 3,586 points, is threatened. This temporary delight cannot resist to the reality of the COVID-19 pandemics since the cases and the deaths are in all-time high numbers. The concerns for the global economies are getting stronger and stronger. In case of a correction, there will be important role on the support at 3,500 points but if we’ll see the all-time highs breakout, above 3,586 points, it’s very possible to raise new buyers in a general euphoria environment. Generally, we’re buyers but in case of dropping below 3,500 points we’ll open short positions.
Germany is in a lockdown but this fact did not prevent DAX30 to perform remarkable profits like 7.5%, closing at 12,480 points. This week, Index keeps on rallying having surpassed even 12,700, looking higher to 13,000 μονάδες. The reality of the pandemic is still here though and if this sense dominates in the markets, we may see strong corrections. Short positions is our selection for this week.
FTSE100 followed the picture of the rest major Indices last week and closed at 5,888 points, with profits more than 5.50%. UK is in a lockdown and we enter into the last week of the Brexit negotiations with EU. Positive news may cause a rally for the Index and cause a return above 6,000 points so long positions is a good choice for us this week.
It was a bullish week for gold, which closed at $1,952 with profits that touched 4%. A very critical role to this had to do with the weak USD and the restoration of the conversations regarding the new US economic aid package, after the new president of USA election. Having surpassed the resistance at $1,940, gold is able to “see” better the price area of $2,000 which is possible enough to reach if the uncertainty and the concerns regarding COVID-19 dominate in the markets. Buy positions is what we’ll try this week on gold.
Bullish reaction for oil prices we saw last week, closing at $37.43 by performing profits like 4.8%. The concerns regarding oil demand are still strong since many countries are in a lockdown situation but we should not forget that the demand champion worldwide is China which recovers impressively. On the other hand, there is a sense between the investors that finally OPEC will decide new production cuts and this fact creates expectations that oil price may rise. Technically speaking, above the current price level there’s the support at $39.30 and just in case that concerts dominate again, oil prices may test the supports at $37 and $36.10. We’ll try short positions this week.
Price rally and party for Bitcoin prices during the previous week. Bitcoin closed at $15,489 with impressive profits, more than 12.5%. It is a very indicative fact that during the October, Bitcoin performed about 30% and November is also an impressive month. There is an overall enthusiasm amongst the cryptocurrencies traders & investors who seem to live again the days of 2018 where Bitcoin after several rallies, climbed at $20,000. A possible hold–back factor may be that this market has matured enough till now and many cryptocurrencies owners may proceed to liquidations due to short term profit taking reasons. We cannot resist on such a strong uptrend; we remain buyers on Bitcoin.