The GBP is the strongest and the NZD is the weakest on shift to risk aversion

Technical Analysis

Author: Greg Michalowski | forex

The USD is mixed

As the markets shift to risk aversion on increased coronavirus fears, The GBP and JPY are the strongest while the NZD and AUD are the weakest. The USD is mixed.  The GBP got its boost after Chancellor the Exchequer Javid resigned and was replaced by Rishi Sunak who it is perceived would be more open to growth initiatives.  

The numbers for infected and deaths in China in February look like this:

  • Feb 1: 14,380 (death toll 304)
  • Feb 2: 17,205 (death toll 361)
  • Feb 3: 20,438 (death toll 425)
  • Feb 4: 24,324 (death toll 490)
  • Feb 5: 28,018 (death toll 563)
  • Feb 6: 31,161 (death toll 636)
  • Feb 7: 34,564 (death tol it will l 722)
  • Feb 8: 37,198 (death toll 811)
  • Feb 9: 40,171 (death toll 908)
  • Feb 10: 42,638 (death toll 1,016)
  • Feb 11: 44,653 (death toll 1,113)
  • Feb 12: 59,805 (death toll 1,367)
 The USD is mixed

The ranges and changes are showing the spike in the GBP pairs (EURBGBP moves lower of course). The ranges are larger in the GBP pairs as well. Apart from the GBPJPY(which is higher and trading near its high), the JPY pairs are trading near lows levels at the start of the North American session.

The ranges and changes for the major currency pairs
In other markets:
  • Spot gold is trading up $7.30 or 0.48% at $1573.36
  • WTI crude oil futures are trading down $0.12 -0.23% of $51.05. The price is off its session lows and $50.60
In the US stock market, the futures are implying a lower opening:
  • Dow, -157 points
  • S&P index -20 points
  • NASDAQ -73 points
In the European equity markets, the major indices are also heading to the downside:
  • German DAX, -0.6%
  • France's CAC, -0.7%
  • UK's FTSE 100 down 1.4% (helped push lower by the higher found)
  • Spain's Ibex, -1%
  • Italy's FTSE MIB, -0.6%
In the US debt market yields are trading lower on flight to safety flows:

US yields are lower
In the European debt market yields are also lower with the exception of the UK as they react to the Javid resignation and hiring of Rishi Sunak

European yields are lower with the exception of the UK

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