USD/CAD
What happened previously?
There are more signs showing the crisis may be easing in some areas, sending stocks soaring. Italy, France, Germany and Spain reported lower numbers of new cases. S&P 500 jumped 7% to 2663.68 as of 4 pm in New York, to the highest since March 13.It rose above its 200-week moving average of 2645.50. USD is likely to weaken when market optimism grows while this risk-on sentiment will strengthen up CAD. Fundamentally, we remain bearish for USDCAD.
What can we expect?
We are seeing price to test 1st resistance at 1.42677 and Stochastics is also reaching resistance level. 1st resistance level is a confluence level of horizontal swing high resistance and 76.4% Fibonacci retracement. If price breaks and closes above this level, we might turn bullish from bearish since it opens up more upside.
UKOIL
What happened previously?
Oil edged higher upon signs that the largest producers - OPEC+ and Russia are moving closer to a deal. According to Vandana Hari, the founder of Vanda Insights in Singapore, there’s a better than 50% chance this time that OPEC+ will deliver a cut. Oil price shows signs of stabilizing after the news.
What can we expect?
We remain neutral for today’s trading. We are seeing the price ranging between 1st resistance at 35.88 and 1st support at 31.10. We remain neutral until price edge up till 1st resistance or drop till 1st support. Currently Ichimoku cloud is showing more pushup is more likely. If price goes up towards 1st resistance, a reversal is likely at our 1st resistance at 35.88. 1st resistance level happens to be where the 78.6% Fibonacci retracement lines up with horizontal swing high.
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XAUUSD
What happened previously?
Market has shown enough confusion to investors these days. While stock market has its best day in this week, gold continued to surge. The jump in gold came even as risk assets posted gains on signs the outbreak may be levelling off. Even though hopes are rising of a slowdown in the pandemic, enough doubt exists to see safe-haven assets in strong demand. The market is showing some wilderness here to keep gold in the bids.
What can we expect?
We remain bearish technically as the price is approaching 1st resistance at 1701.08 and is likely to drop from there. Stochastics is also showing signs of overbought reaching a level of 98.65 for a drop to happen. The 1st resistance happens to be where 161.8% Fibonacci retracement and 61.8% Fibonacci extension line up well and could serve as a key resistance level. Ichimoku cloud is also showing a push up towards 1st resistance is likely.
XCUUSD
What happened previously?
Market shows great relief after crisis may be easing in some areas, sending stocks soaring. Italy, France, Germany and Spain reported lower numbers of new cases. S&P 500 jumped 7% to 2663.68 as of 4 pm in New York, to the highest since March 13.It rose above its 200-week moving average of 2645.50.
Asian market is set to see their back-to-back gain on continuing optimism in Asia trading hours.
What can we expect?
We turn bullish as price broke above our previous 1st resistance at 2.24386, which confirmed our bullish bias. The upside confirmation level happens to be where the 50% Fibonacci retracement and previous swing high resistance line up. Price is likely to bounce further from here given that the Ichimoku is also showing signs of bullishness.
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Desmond Leong runs an award-winning research firm (The Technical Analyst finalists 2018/19/20 for Best FX and Equity Research) advising banks, brokers and hedge funds. Backed by a team of CFA, CMT, CFTe accredited traders, he takes on the market daily using a combination of technical and fundamental analysis.