Forex news from the European trading session - 7 April 2020



  • AUD leads, USD lags on the day
  • European equities higher; E-minis up by 3.5%
  • US 10-year yields up 7 bps to 0.74%
  • Gold down 0.3% to $1,656.20
  • WTI up 1.5% to $26.50
  • Bitcoin up 2.7% to $7,428
EOD 07-04

The risk rally is continuing on the week as we see stocks surge higher once again after a bit of a tepid start earlier in the day.

US futures fell by 0.5% before ripping higher by over 1% just ahead of the European open before surging ahead to post over 3% gains now.

European indices also kept pace, with gains of around 3-4% being seen across the board.

As risk trades surged higher, the dollar weakened across the board and also fell against EM currencies today. The general dollar weakness sees AUD/USD extend gains to 0.6190 from 0.6120 with the RBA keeping policy unchanged as well.

Meanwhile, USD/CAD moved lower to test the 1.4000 handle from 1.4070 amid a softer dollar and steadier oil prices helped to underpin the loonie.

The euro and the pound also saw solid gains against the greenback with the former breaking above its 100-hour moving average to climb to 1.0890 while the latter flirts with a firm break of its key hourly moving averages in a move to 1.2350.

For now, the risk rally remains impressive to start the new week but it is one that is being built on shaky foundations one might argue. The technical side of things may also be starting to look better but it still isn't all too convincing just yet in my view.

Lockdown measures don't look to be ending any time soon and as mentioned yesterday, there are still many uncertainties associated with the virus outbreak that extends well beyond what may happen next over the coming weeks/months.