Daily Market Charts and Analysis May 11, 2020

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Market Charts and Analysis

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

EURSEK

Despite the decision of the Swedish central bank late last month to leave its interest rates unmoved at 0.00%, the Swedish krona holds it gaining momentum against the euro. Although as of writing, the pair is seen climbing back again as the euro strengthens thanks to the broader weakness of the US dollar. The single currency benefited from the concerns of greenback traders, using the boost to gain against most of its currency pairs in the forex market. However, the pair is still widely expected to drop to its support levels. Sweden has not adopted a harsh and Gregorian-like lockdown measure for its country to counter the coronavirus. However, some companies in the country have closed their facilities, and most consumers still reined in on their spending budgets to cut back their losses. However, investors of the Swedish krona are hoping that the different approaches of the Swedish authorities would lessen the impact of the virus on the economy.

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EURCZK

The deeper than expected rate cut from late last week has strained the strength of the Czech krona. The euro to Czech krona is now expected to climb back up to its resistance as the euro also strengthens. The Czech National Bank has unleashed a 0.75 basis point rate cut on Thursday last week. That is the third in its reductions since the coronavirus outbreak. The unexpected cut now brings the Czech National Bank’s official interest rates at 0.25%. The rate cuts also reverse the more than to years tightening of the bank and has raised speculations as to whether the central bank is willing to take its rats further below the 0.00% mark. Aside from that, other stimulus from the country has also weighed in on the crown. The Czech Parliament reportedly passed a bill late month that grants the country’s monetary authority to more asset-buying powers. However, the bank said that it will not yet use the new power at the moment and will wait for further guidance.

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USDHUF

As of writing, the pair has steadied after investors of the US dollar focus on other fundamentals, while investors of the Hungarian forint worry about the new central bank news. Still, the buck is expected to continue to depreciate against the forint as the market focus on the status of the US economy. The market continues to evaluate the impact of the reopening of the American economy, however, as the number of cases continues to spike there, investors are still worried about the potential risks such as another wave of cases. Aside from that, the safe-haven appeal of the US dollar is faltering following the news about probable meetings between Chinese and US top trade negotiators in the near-term future. Moreover, Governor Gyorgy Matolcsy of the National Bank of Hungary said that the bank has curbed its long-term yields successfully in its government bond purchasing program. Matolcsy added that the bank would only extend the program if necessary.

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USDMXN

The Mexican peso makes a reversal last week following the news from the US labor force. The Mexican peso outperforms the US dollar and is still expected to continue its momentum. The pair is expected to go down to its support by the second half of the month as bearish investors look to force the 50-day moving average to turn around and come closer to the 200-day moving average. The beloved peso is holding firm against the US dollar despite the initial depreciation of the Brazilian real to its lowest record. Also, the improvements in the global risk sentiment and the recovering crude oil prices in the commodity market added to the bearish bias of the USDMXN pair. The negativity in the US labor market has also raised concerns about lower rates from the US Federal Reserve to support businesses that are struggling thanks to the coronavirus. Another reason that’s hurting the buck’s performance is the mitigated trade tensions between the US and China.

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