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21.02.2020

XAU/USD: gold prices are rising

Gold prices show steady growth during today’s Asian session, updating record highs of February 2013. The quotes are supported by the continuing uncertainty surrounding the further spread of the coronavirus. Despite all the efforts of the Chinese authorities, as well as the relatively stable statistics of cases, investors are extremely sensitive to any new cases recorded outside of China.

Morning Market Review

EUR shows a slight increase against USD during today's Asian session, consolidating near three-year lows, once again updated on Thursday. Market problems dominate over EUR, which has been showing the worst results since 2015. Negative macroeconomic statistics, the threat of a recession in the German economy, as well as the uncertain prospects for trade negotiations with the UK negatively affect the dynamics of the instrument. At the end of the week, investors expect the publication of statistics on business activity from Europe, but the forecasts again do not promise anything good for EUR. Manufacturing PMI in Germany may fall in February from 45.3 to 44.8 points; Markit Composite PMI may decline from 51.2 to 50.8 points. In addition, on Friday, traders expect the publication of January statistics on consumer inflation in the euro area.

USD/CAD: wave analysis

The pair may grow.

On the daily chart, a downward correction of the higher level formed as the second wave (2), and the development of the wave (3) started. Now, the first entry wave of the lower level i of 1 of (3) is forming, within which a local correction has ended as the wave (iv) of i. If the assumption is correct, the pair will grow to the levels of 1.3400–1.3564. In this scenario, critical stop loss level is 1.3208.

USD/JPY: wave analysis

The pair may grow.

On the daily chart, the third wave of the higher level 3 of (C) forms, within which the wave iii of 3 develops. Now, the third wave of the lower level (iii) of iii is forming. If the assumption is correct, the pair will grow to the levels of 113.50–114.30. In this scenario, critical stop loss level is 109.62.

EUR/CHF: Ichimoku clouds

On the daily chart Tenkan-sen line is below Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (1.0500). The closest resistance level is Tenkan-sen line (1.0650).

AUD/CAD: Ichimoku clouds

On the daily chart Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (0.8600). The closest resistance level is Tenkan-sen line (0.8850).

EUR/JPY: Ichimoku clouds

Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the red line is directed upwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Tenkan-sen line (120.385). One of the previous maximums of Chikou Span line is expected to be a resistance level (121.368).

Consumer Price Index. Japan, 01:30 (GMT+2)

The data on Japan's Consumer Price Index for January are due at 01:30 (GMT+2). It is the main indicator of inflation in the country and determines the change in the level of retail prices for a particular basket of goods and services: food, transportation, utilities, healthcare, etc. It has a significant impact on monetary policy decisions. It is expected that on annual basis CPI may decline from 0.8% to 0.7%, and Core CPI may increase from 0.7% to 0.8%.

Manufacturing and Services PMIs. Australia, 00:00 (GMT+2)

At 00:00 (GMT+2), preliminary data on Manufacturing and Services business activity indices in Australia for February will be released. The indicators are compiled from the enterprises responses about their purchasing activities and supply situations. At the same time, the attitude of purchasing managers to the current economic situation and prospects for its further development is evaluated. It is expected that the Manufacturing PMI will decrease from 49.6 to 48.9 points, while Services PMI will increase from 50.6 to 52.4 points.