Daily Market Charts and Analysis February 14, 2020

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Here are the latest market charts and analysis for today. Check them out and know what’s happening in the market today.

USDCZK

The pair is trading in the green, rising just below the 200-day moving average and recovering from a massive decline just days ago. Last week, the Czech National Bank unexpectedly raised interest rates, which was considered one last move in its tightening series going back to 2017. The tightening program was aimed at reining in domestic prices and pressures in the slowing economy. More recently, the country’s exports saw a 3.6% gain to reach 4,563 billion Czech crowns, or $199 billion, in 2019, according to the Ministry of Industry and Trade. Meanwhile, the US dollar was boosted by the pickup in underlying consumer prices in January, data confirmed. Households paid more for rents and clothing, backing the Federal Reserve’s claim inflation would gradually rise toward the bank’s 2% target. The Labor Department said its consumer price index (not including volatile food and energy components) rose 0.2% last month after inching 0.1% in December.

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EURCHF

The euro kept on losing steam against the Swiss franc, which is dragging the price of the EURCHF to four-and-a-half year lows. Traders are seeking safe-haven assets after China’s Hubei province, which is the ground zero of the coronavirus outbreak, reported a massive increase in the number of new confirmed cases. Health officials are now using a new method of diagnosis, reporting an increase of 14,840 for new cases. That’s tremendously higher than the 1,638 new cases reported just the day before. The death toll surged by 242, which is a daily record, to reach a total of 1,310. Traders are trying to minimize their exposure to riskier assets, boosting safe havens like the Swiss franc and Japanese yen. Europe, particularly Germany, has very strong trade links to markets in Asia, particularly with China. Europe has hoped for a rebound in growth in 2020. However, because of the coronavirus and the global uncertainty it brings, markets need to reassess.

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EURGBP

The euro is also losing against the pound sterling, with price levels staying below the 50-day moving average in the recent sessions, with no signs of reversal anytime soon. The pound climbed after the surprise resignation of Sajid Javid as Chancellor of the Exchequer, which is the UK’s chief finance official. The exit shocked Westminster when there weren’t any expectations of a huge shakeup of Boris Johnson’s government. Javid was due to deliver his first annual budget in four weeks. This update marks another political bang after politics took a rest from the headlines in recent weeks, with traders focusing instead on domestic data and the Bank of England’s moves regarding interest rates (to cut or not to cut). There was initially the news of the Johnson’s government’s cabinet reshuffle. The reshuffle was expected but markets weren’t anticipating any significant news that may prompt huge market movements.

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EURJPY

Against the Japanese yen, the euro didn’t fare any better. It slipped to multi-month lows against the safe-haven currency and traded in the red. The Japanese yen gained a lot since risk aversion became the dominant mood in the market, thanks to the coronavirus outbreak. Demand for the safe-haven asset soared after the steep rise in confirmed infection cases and the rise in death toll. Investors are likely to seek refuge in safe havens as uncertainty about the extent of the epidemic remains rampant. They will be waiting for signs the spread of the virus has slowed down. Meanwhile, a survey showed economists were forecasting China’s economy would grow at its slowest rate since the financial crisis in the current quarter. However, analysts agree that the slowdown would be short-lived if the outbreak is successfully contained. The coronavirus was first detected in the city of Wuhan, which is a major city for the global supply chain.

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