The market opened with growth amid a decision by the US Federal Reserve to cut rates by 100 bp, to the level of 0.0%-0.25%. The general weakening of the dollar and falling stock indices supported the euro throughout the day.
Major US stock indices fell at the close trading by 11% -12%. The index of business activity in New York came out significantly below the forecast, trading in the negative zone. Markets remain in disarray due to the easing of monetary policies by central banks, as well as the rapid spread of the new coronavirus outside of China.
Today’s news (GMT 3):
- 12:30 UK: ILO Unemployment Rate (3M) (Jan), Average Earnings Including Bonus (3Mo/Yr) (Jan).
- 13:00 Germany: aZEW Survey - Economic Sentiment (Mar).
- 15:30 Canada: Canadian Portfolio Investment in Foreign Securities (Jan), Manufacturing Sales (MoM) (Jan).
- 15:30 USA: G7 Call on Coronavirus.
- 16:15 USA: Industrial Production (MoM) (Feb).
- 17:00 USA: NAHB Housing Market Index (Mar).
According to the wave structure expected movement in prices were justified. Since there were more negative factors against the US currency, the price path turned out to be higher than laid out in the forecast scenario.
The price is currently trading near the balance line (Lb). Given that futures for US indices are trading in positive territory at 3.7%, it can be assumed that European indices will also grow after the market opens. This means that the euro will be under pressure at the beginning of the session, and in the American session, we can consider a recovery to 1.1225 along the upper-line of the channel.
Naturally, the focus is on coronavirus and its effects on the global economy. From the news, it is worth highlighting the forthcoming report covering the US labour market.