Market Analysis

The dollar continues to decline

FOREX

The dollar continues to decline versus its peers during early Monday trading, as the number of COVID-related fatalities reached 170,000 in the US and political partisanship in Washington, between Democrat and Republican lawmakers, prevents the signing off of a much needed financial stimulus package for an economy that now counts more than 30 million people as unemployed. There may be more downside risks ahead for the dollar as many investors, including large funds, have turned bearish towards the greenback.

Ricardo Evangelista – Senior Analyst, ActivTrades

 

Source: ActivTrader

 


GOLD

Gold price is consolidating above $1,950, remaining around $120 below the peak reached less than two weeks ago, but still 28% up from the beginning of the year. This period of consolidation comes after a massive rally, followed by a sharp decline. The price rebounded on the support zone of $1,870, finding another support zone at $1,920-$1,930. In the last few days volatility spiked up, while on Friday the price tried to stabilize after these massive movements. We will have a new bullish signal with a clear surpass of $1,965, in a scenario that remains dominated by coronavirus news and fears of further lockdowns. Expectations for further actions by central banks remain ever present and this is another supportive element for gold. A fresh decline below the support zone of $1,920-$1,930 would denote weakness.

Carlo Alberto De Casa – Chief analyst, ActivTrades

Source: ActivTrader

 

EUROPEAN SHARES 
European share markets started the week on a mixed note as the “wait and see” trading stance continues ahead of a busy week. Stimulus measures and the US-Sino relationship remain the biggest market drivers at the moment and investors were slightly disappointed to see trade talks between Washington and Beijing, initially planned for this week, have been postponed. Wednesday is likely to be the most volatile day of the week as traders patiently wait for the Fed’s minutes of its last meeting in order to predict the next move from the central bank. Further downside risks in the near term may increase if these minutes prove disappointing as many investors have already anticipated further stimulus measures. Elsewhere traders will also keep a close eye on oil markets and energy shares this week as the next OPEC meeting looms on Wednesday and, depending on the tone and discussion, could lead to volatility spikes on energy-related sectors.

European markets remain neutral so far, with losses in utilities offset by gains in the IT sector. The Stoxx-50 Index is still trading sideways in the middle of its 3,100-3,400pts trading range.

Pierre Veyret– Technical analyst, ActivTrades

Source: ActivTrader

 

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