Daily Market Outlook, 7 February, 2020

Market Wrap: Stocks, Bonds, Commodities

US Wall Street’s major stock indices advanced on Thursday, Wall Street’s main indexes touches record high levels as concerns faded over the economic impact from the coronavirus outbreak in China.

The Dow Jones Industrial Average added 88.92 points (0.30%) to 29,379.77, the S&P 500 rose 11.09 points (0.33%) to 3,345.78 and the Nasdaq Composite advanced 63.47 points (0.67%) to 9,572.
Regarding the U.S. economic data, the focus has shifted to the closely-watched U.S. nonfarm Employment change report due later on Friday, which is forecast to 163k from 145 earlier months.

Asian markets declined in morning trade on Friday. China’s trade data, which is due later in the day, is hope to generate some focus as investors tried to quantify the potential economic impact of the virus outbreak in China.

MSCI’s index of Asia-Pacific stocks outside Japan declined 1.0% to 679.10 on Friday, though it is still up 3.20% for the week. Japan’s Nikkei down 0.25% to 23,826.

European stocks were rose on Wednesday, with the Stoxx Europe 50 Index advanced 0.73% to 3,805.52, Germany’s DAX gained 0.72% to 13,574.72 and France’s CAC added 0.88% to 6.038.18 and the U.K.’s FTSE 100 advanced 0.30% to 7,505.

U.S. government-bond prices up as demand for safe-haven assets grow. The benchmark U.S. 10-year Treasury yield down 1.06% to 1.627.

Gold prices advanced for a second-straight day as the momentum behind this week’s rally in stock indices faded ahead of the U.S. nonfarm payrolls report on Friday. Today spot Gold traded flat to $1566 per ounce.

Oil prices climbed on Friday after Russia said it backs a recommendation for OPEC and other producers to deepen output cuts amid falling demand for crude as China battles the coronavirus epidemic that has hit global markets.

Brent crude up 0.29% at $55.60 per barrel, while US West Texas Intermediate (WTI) crude rose 0.20% to $51.05 per barrel.

Market Wrap: Forex

The dollar held near a two-week high versus the yen on Friday on upbeat U.S. economic data ahead of a key jobs report and the death toll from a new coronavirus in China jumped yet again.

The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, advanced -0.05% to 98.330.

The pound was little changed at $1.29400, close to the lowest since December 25 and declined 2% for the week.

The Australian dollar declined 0.18% to $0.67180 after the RBA slashed growth forecasts in its quarterly economic outlook due to bushfires and china’s coronavirus outbreak.

EUR/USD Intraday: Intraday Resistance at 1.09880

Our pivot point is at 1.09880

Preferable Price Action: Take short positions below resistance level with targets at 1.09745 & 1.09655 in extension.

Alternative Price Action: Above pivot looks for further upside at 1.10016 & 1.10106

Comment: The RSI indicator below 50 and MACD on the negative side. Moreover, the pair is trading below its 20MA & 55 MA.

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

GBP/USD Intraday:  The bias remains bearish

Our pivot point is at 1.29480

Preferable Price Action: Short positions below pivot with targets at 1.29240 & 1.29111 in extension.

Alternative Price Action: Price above pivot would call for further upside to 1.29655 and 1.29817

Comment: The RSI indicator near the 50-level mark and pair below its 55MA and above 20MA

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

JPY/USD Intraday:  Upside moment continues

Our pivot point is at 109.800

Preferable Price Action: Long position above 109.800 with the target at 110.062 and 110.219 in extension

Alternative Price Action: The downside breakout of 109.800 would call for 109.568 and 109.408

Comment: Pair above its 20MA and 55MA and MACD also in positive territory.

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

AUD/USD Intraday:  Trend reverse

Our pivot point is at 0.67255

Preferable Price Action: Short positions below pivot with targets at 0.67124 & 0.67032 in extension.

Alternative Price Action: Above pivot looks for further upside with 0.67325 & 0.67440 as targets.

Comment: The RSI indicator below 50 levels and price below their 55MA and 20MA and MACD also in negative territory.

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

CRUDEOIL Intraday: Near phycological 50 level

Our pivot point is at 51.42

Preferable Price Action: Sell below 51.42 with targets at 50.95 and 50.66 in extension.

Alternative Price Action: Above pivots buy Oil with 51.77 & 52 as targets.

Comment: price take support near Bollinger band lower line

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

XAU/USD Intraday: 

Our pivot point is at 1567.44

Preferable Price Action: Further downside to 1562.42 & 1560.01

Alternative Price Action: If price gives upside breakout of a pivot, then price extends to 1571.56 and 1574.61

Comment: The RSI indicator below 50 marks and MACD near-zero level.

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

Dow jones Intraday:   Upside Continues

Our pivot point is at 29,276

Preferable Price Action: Take long positions above pivot with targets at 29,406 & 29,553 in extension.

Alternative Price Action: Below 29,276 looks for further downside to 29,142 & 29,021.

Comment: The RSI indicator at 50 marks. Moreover, the pair is trading above 20MA and below its 55MA.

Green Lines Indicate Resistance Levels  – Red Lines Indicates Support Levels  
– Light Blue is a Pivot Point   – Black represents the price when the report was produced

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