Daily Market Charts and Analysis August 18, 2020

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

EURNZD

European Central Bank Vice President Luis de Guindos told markets that banks in the block are unlikely to recover until 2022. Considering that the rate of economic recovery will be a fundamental factor in European banks’ solvency, markets are expected to pay close attention to their recovery as a basis for the bloc’s overall economy. Soon after the 50-day moving average declined into 200-day moving averages, the EURNZD pair is now expected to witness the bear market in nearer sessions. Although, investors are still hesitant. The euro currency’s fall will be dampened by recent news from New Zealand that it ended its 102-day streak without community transmission of the coronavirus. The outbreak’s return was held in New Zealand’s largest city and forced itself back into lockdown. The exchange’s contrary turn will be determined by the upcoming PPI input and figures for the second quarter.

CADJPY

The loonie-yen pair is still projected to skirt through a bearish market near-term. As investors prepare for Canada’s report for its GDP figures to come next week, the Japanese yen is expected to boost against the loonie thanks to today’s expected boosts in yearly import and export figures for the month of July. More specifically, they are expected to see an increase from -26.2% in 2019 to -21.0% this year and to -22.8% from -14.4%, respectively. CADJPY’s 50-day moving average is moving sideways below the 200-day moving average, signaling that if bull investors want to trade for the loonie, they would have to wait at least until its GDP announcement in a week or so. Investors are also keeping a close eye on news that Canada saw a 64% drop in immigration, which raises concern in the market, largely due to its integral role in government efforts to grow the workforce. Until Canada reports positivity to counter it, the loonie is bound to fall.

USDRUB

Political unrest in Belarus is projected to push the ruble down against the US dollar near-term following the results from the presidential elections two weeks ago. Market participants are watching how Russia reacts to conflicts in Belarus, raising the geopolitical risk that affects the ruble. The pair’s 50-day averages are also pointing to a bullish market in upcoming sessions even as the 200-day average continues to gradually rise. The United States’ sanction on Russia for “interfering” its local elections is going to push the Russian currency down as its own economy suffers from growing coronavirus cases. The US also recently announced a higher result for its building permits record both against market consensus and its previous record seen in June from 1.258 million to 1.495 million and the estimated 1.320 million prior. Housing starts for July also increased from 1.220 million to 1.496 million in the US. 

EURRUB

Even days after Russia reported an economic drop of 8.5% in the second quarter of 2020 its ruble currency is still seeing losses over oil prices, stock market surges, and geopolitical conflicts. Investors in bull position are supporting the sharp jump in China-US foreign trade operations while Russia is left behind. Meanwhile, the stability of other indices is still giving weakness to the ruble. Investors are also hesitant of the ruble due to sanctions and conflicts between its economy and Belarus, the possibility of escalation growing each day. It also gives a negative revaluation of all financial assets in the country with risk aversion alive and well in the market. The 50-day moving average is also stepping up while the 200-day moving average remains stagnant far below it. Economists are expecting the Russian currency to increase from medium terms onward as major European banks continue its struggle to recover from financial losses in the pandemic.