Daily Market Charts and Analysis January 21, 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.

USDCNH

The pair will retest the resistance line prior to the bearish crossover between MAs 50 and 200. The appeal for the US dollar is back following the signing of the US-China phase one trade deal. Yesterday, January 20, China hit back on critics doubting whether it will be able to fulfil its obligations under the deal. China said it is committed to purchasing additional $200 billion worth of American goods. That was on top of the current agricultural import of $32 billion. In line with this, Agriculture Secretary Sonny Perdue said government aid to farmers was no longer an option. He further stated that the trade deal with China is enough to keep the sector afloat. His remarks came a day after President Trump promised farmers that the deal will be good for them. This announcement has increased the demand for the greenback, disappointing the bear traders. During the height of trade war, China banned the import of US soybean, hurting the agricultural sector.

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USDTRY

The pair bounced back from 50 MA, showing a continuous growth for the US dollar. The Turkish lira continues to falter amid the uncertainty surrounding the industrial and emerging economies. Turkey’s currency slipped 0.3% in yesterday’s trading following a comment from an analyst. Albayrak, an analyst from Bloomberg, slammed lira after he said that the government needs to make the country’s currency more competitive. He was pointing on the recent report showing the Turkish lira’s nominal growth below zero (0). The country’s interest rate of 11.25% was beaten by inflation figures, resulting in Turkey to have a nominal growth of -0.6%. Since the second half of 2019, Central Bank Governor Murat Uysal slashed Turkey’s interest rate from 24% to 11.25% in five (5) rounds of interest rate cut. Despite this, analysts are expecting a higher growth rate for Turkey in 2019 and are optimistic for 2020 with the $15 billion foreign direct investment (FDI).

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EURNZD

The pair will fail to breakout from 50 MA and from a major resistance line as consolidation continues. New Zealand’s Global Dairy Trade Price Index will continue to post positive result this week. This was following last week’s recovery in the index where it jumped to 2.8%, from negative 5.1% result on the first week of the year. The report also has a history of consecutive positive results, which suggest that the Global Trade Price has a high possibility of posting positive results. The slump in dairy products comes amid the increasing brand name awareness of the European Union. New Zealand’s neighbouring country, Australia, was the first to be hit by the recent move of the EU. Brussels argued that the name “Prosecco” on Australian wine exports should be drop. It ruled that the name can only be used by wine producers in Northern Italy. In response, the Australian government funded a $100,000 research on the name to defend its exports.

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AUDNZD

The pair will continue to move lower in the following days as 50 MA stopped AUD’s gains. In last week’s trading session, the Australian dollar tried to fight back the kiwi. This was amid the efforts of the national government to stop the wildfire, giving AUD traders optimism. The fire burned $3 billion for the cost of damage it had with the environment, businesses, and properties. More than 10,000 homes were damaged and almost half a billion animals died. In line with this, recent report shows more Australian flying to New Zealand as the wildfire continues. This will give New Zealand economy a short-term boost. The NZ economy, particularly the country’s currency, will also gain from the looming withdrawal of the United Kingdom from the European Union. A UK representative said during the meeting with his NZ counterpart that New Zealand was the country’s top priority in a post-Brexit UK.

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