Daily Market Outlook, 12 February 2020

Market Wrap: Stocks, Bonds, Commodities

US Wall Street’s major stock indices S&P 500 and the Nasdaq composite to their second consecutive record closing highs on Tuesday as the Chinese government said the coronavirus epidemic could be contained by end of April.

The Dow Jones Industrial Average was flat, the S&P 500 rose 5.66 points (0.17%) to 3,357.75 and the Nasdaq Composite added 10.55 points (0.11%) to 9,638.94.

Asian stock indices inched higher on Wednesday amid hopes the worst of the coronavirus in China may have gone, although uncertainty about the outbreak has kept investors wary.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.83% to 690 level. Australian shares were up 0.50%, while Japan’s Nikkei stock index rose 0.55%.

European stocks were advanced on Tuesday, with the Stoxx Europe 50 Index rose 0.86% to 3,825.84, Germany’s DAX gained 0.99% to 13,627.84 and France’s CAC added 0.65% to 6,065.76 and the U.K.’s FTSE 100 advanced 0.71% to 7,499.44.

U.S. government-bond prices down as demand for risky assets grow. The benchmark U.S. 10-year Treasury yields up 1.86% to 1.620.

The yellow metal lost some of its shine as a hedge to the coronavirus crisis after Fed chair Jay Powell said the American economy has been fairly resilient against the pandemic.

Oil prices inched higher second consecutive day amid signs that new coronavirus cases are slowing down in China, easing concerns over the demand impact from the world’s second-largest oil consumer.

Brent crude was up 1.75% to $55.30 per barrel. US West Texas Intermediate (WTI) rose 1.30% to $50.57.

Market Wrap: Forex

The U.S. dollar was down on Tuesday as weaker-than-expected labor data against positive remarks from Fed chair Jerome Powell on the economy.

Today, The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, up +0.08% to 98.677.

The EURO gained ground against the US dollar index during the North American session as Fed chairman Jerome Powell said there is not much impact on the US economy by a coronavirus.

Other Commodity-linked currencies were broadly higher against the greenback. AUD/USD advanced +0.23% to 0.67285 and NZD/USD higher +0.88% to 0.64580.

EUR/USD Intraday: Downtrend continues

Our pivot point is at 1.09170

Preferable Price Action: Take short positions below pivot level with targets at 1.09035 & 1.08928 in extension.

Alternative Price Action: Above pivot looks for further upside at 1.09294 & 1.09408

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

GBP/USD Intraday:  Intraday support at 1.29480

Our pivot point is at 1.29480

Preferable Price Action: Long positions above pivot with targets at 1.29641 & 1.29759 in extension.

Alternative Price Action: Price below pivot would call for further downside to 1.29313 and 1.29182

Comment: The RSI indicator near the 50-level mark and pair above 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 109.830

Preferable Price Action: Long position above 109.830 with the target at 109.940 and 110.025 in extension

Alternative Price Action: The downside breakout of 109.840 would call for 109.717 and 109.628

Comment: Pair above its 20MA and 55MA and MACD 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:  Intraday support at 0.67090

Our pivot point is at 0.67090

Preferable Price Action: Long positions above pivot with targets at 0.67364 & 0.67522 in extension.

Alternative Price Action: Below pivot looks for further downside with 0.66900 & 0.66710as targets.

Comment: The RSI indicator above 50 levels and price above their 55MA & 20MA and MACD 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

CRUDEOIL Intraday: May take support near 50 level

Our pivot point is at 50.45

Preferable Price Action: Buy above 50.45 with targets at 50.89 and 51.20 in extension.

Alternative Price Action: Below pivots sell Oil with 50.05 & 49.63 as targets.

Comment: Take support at the 50 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

XAU/USD Intraday:  Intraday Resistance at 1568.84

Our pivot point is at 1568.84

Preferable Price Action: Further downside to 1565.19 & 1562.31

Alternative Price Action: If price gives upside breakout of a pivot, then price extends to 1572.43 and 1574.82

Comment: The RSI indicator below 30 level and MACD 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

Dow jones Intraday:   Trend Continues upward

Our pivot point is at 29,277

Preferable Price Action: Take long positions above pivot with targets at 29,426 & 28,516 in extension.

Alternative Price Action: Below 29,277 looks for further downside to 29,150 & 29,023.

Comment: Pair is trading above its 20MA & 55MA and RSI above 50 levels.

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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