20th July 2020 - US Dollar weakness, equity gains keep the bulls on the table despite virus worries



Good Morning,

Market Headlines

Relatively quiet session for US equity markets making modest gains, on the Commodities front, Brent oil futures retraced 0.5% to $43.13, copper remained unchanged, iron ore dropped 0.8% to $110.00, and gold gained 0.7%. Markets continue to monitor ongoing earnings results, virus updates and the Sino-American tension

Currencies

US Dollar Index declined 0.4% for the day.

EUR ranged between 1.1380 to 1.1444.

AUD/EUR traded between 0.6101 and 0.6141

USD/JPY traded between 107.25 and 106.94.

AUD traded between 0.6975 and 0.7005.

NZD traded between 0.6535 and 0.6566.

AUD/NZD traded between 1.0665 and 1.0680.

AUD Thoughts

- AUD/USD attempts recovery from the week-start gap down to 0.6984.

- US Dollar weakness, equity gains keep the bulls on the table despite virus worries at home.

- The government in Victoria makes it compulsory to use face masks and social distancing following a record spike in new cases.

- Aussie Treasurer Frydenberg suggests an extension of the loan scheme.

Looking forward, a lack of major data/events will keep markets searching for fresh clues from the qualitative risk catalysts like virus and the Sino-American tension. Also likely to affect the pair’s moves is any decision from the European Union (EU) summit where policymakers are divided over the much-awaited stimulus.

Bullish spinning top on the weekly chart adds to the markets sentiment unless successfully breaking above 0.7035. However, bears are less likely to seek entries till the pair stays above 0.6930.

Event Risk Data Today

New Zealand: NZ PSI

UK: House Prices will be released today

Canada: Teranet House Price Index

GE: June PPI

EU: May Current Account

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