US covid- 19 cases impacts dollar

An official from the Japanese Finance Ministry said on Monday, they will keep monitoring the forex developments with a sense of urgency. The official, however, said that he cannot comment on the reasons behind FX moves, on the US election impact as well as on the level of FX itself. 

Business sentiment of Japanese manufacturers and service-sector firms was the least pessimistic in nine months in November, likely as the world’s third-largest economy showed signs of pulling out of a corona virus-induced recession. But both sectors believed conditions will remain negative over the coming months, highlighting the struggle to completely shake off the drag from COVID-19, according to the monthly Reuters Tankan, which tracks the Bank of Japan’s (BOJ) closely watched tankan quarterly survey.

In the poll of 485 large- and mid-sized companies, in which 225 firms responded on condition of anonymity, many complained about the pandemic’s lingering impact, and negative comments about business conditions outnumbered positive ones.

On the other hand, cases of the novel corona virus in the United States have surpassed 10 million. However, this is not new news as according to Worldometer, as of Friday, there were already 10,058,586 confirmed cases of COVID-19 in the US.

According to the same chart, 242,230 people have died from the virus in the US and 6,391,208 have recovered so far from a population of some 327,200,000.This, therefore, equates to around 3% of the country that has already been infected and tested positive.

However, the real number is unknown as there will be people that have had the virus and were asymptomatic or were not tested, so that number could be higher. Nevertheless, the risk of lockdowns is real as the President select has the corona virus as a number one priority to deal with. He is supposed to select a task force as soon as Monday in the US.

He said in his victory speech that “Our work begins with getting Covid under control.”

“I will spare no effort, none, or any commitment to turn around this pandemic,” Mr. Biden said Saturday.

USD/JPY 4 Hours Chart:

Support: 103.07 (S1), 102.83 (S2), 102.49 (S3).

Resistance: 103.65 (R1), 104.00 (R2), 104.24 (R3).

In the prevailing market condition, we expect a mixed trend for USD/JPY.

BTC/USD Weekly Forecast (9th November 2020 – 13th November 2020)

Fundamental view:

Bitcoin rose in the last week an reached 15700 level. According to crypto analytics platform Messari, Bitcoin has now spent more than 20 days above the $15,000 barrier. Now U.S. presidential candidate Joe Biden is six electoral votes away from victory, with officials continuing to count ballots in Georgia, Pennsylvania, North Carolina, Arizona, and Nevada. Many industry experts are predicting continued volatility among cryptocurrencies and the stock market until a winner is determined.

The major economic events deciding the movement of the pair in the next week are JOLTS Job Openings at Nov 10, OPEC Monthly Oil Market Report, Fed Governor Quarles Speech at Nov 11, EIA Crude Oil Stocks Change, Initial Jobless Claims at Nov 12, and PPI monthly report at Nov 13 for US.

BTC/USD Weekly outlook:

Technical View:

Last week’s high was 13.38% higher than the previous week. Maintaining high at 15965.1 and low at 13190.6 showed a movement of 2774 pips.

In the upcoming week we expect BTC/USD to show a bullish trend. The Instrument is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 16650.0 may open a clean path towards 17685.8 and may take a way up to 19415.5. Should 13884.5 prove to be unreliable support, the BTCUSD may sink downwards 12154.8 and 11119.0 respectively. In H4 chart Ascending scallop pattern formation favors prospects of a bullish trend. Bullish spinning top pattern constructs a bullish outlook for the pair in the upcoming week.

 Preference
Buy: 15751.5 target at 17684.2 and stop loss at 13879.9

 

Alternate Scenario
Sell: 13879.9 target at 11125.2 and stop loss at 15751.5

XAU/USD Weekly Forecast (9th November 2020 – 13th November 2020)

Fundamental view:

Gold started the week on a strong footing and preserved its bullish momentum with the USD struggling to find demand throughout the week. With the early results from exit polls showing that US President Donald Trump was performing much better in the presidential race than what the polls suggested allowed USD to gather strength. However, after former Vice President Joe Biden started to narrow the gap, risk flows returned to markets and caused the greenback to come under strong selling pressure.

Later in the week, the USD selloff intensified as Biden took the lead in battleground states, namely Michigan, Georgia and Nevada. As it currently stands, Biden seems to be on his way to become the next president of the US. However, Trump is likely to fight the results in states where the margin is slim and it could take some time before an official result is announced.

The major economic events deciding the movement of the pair in the next week are JOLTS Job Openings at Nov 10, OPEC Monthly Oil Market Report, Fed Governor Quarles Speech at Nov 11, EIA Crude Oil Stocks Change, Initial Jobless Claims at Nov 12, and PPI monthly report at Nov 13 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 2.56% higher than the previous week. Maintaining high at 1960.3 and low at 1873.4 showed a movement of 869 pips.

In the upcoming week we expect XAU/USD to show a bullish trend.  The Instrument is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1984.7 may open a clean path towards 2016.0 and may take a way up to 2071.6. Should 1897.8 prove to be unreliable support, the XAUUSD may sink downwards 1842.2 and 1810.9 respectively. In H4 chart Ascending Triangle breakout favors prospects of a bullish trend. Also to be noted spinning top formation exerts the expectation of uptrend for the pair.

Preference
Buy: 1948.2 target at 2015.9 and stop loss at 1893.5

 

Alternate Scenario
Sell:  1893.5 target at 1815.2 and stop loss at 1948.2

AUD/USD Weekly Forecast (9th November 2020 – 13th November 2020)

Fundamental view:

The Australian dollar has rallied rather significantly during the course of the week but has given up some of the gains on Friday. For election, Joe Biden has 273 electors granted, which means he will become the next occupant of the White House. However, US President Donald Trump has sent to courts his allegations of large-scale fraud and theft. The drama is not over and won’t be for at least a few more days.

Australia Building Approvals monthly report on 2nd November and US Wards Total Vehicle Sales on 3rd November created uptrend for the pair whereas US Final Services PMI on 4th October and US Unemployment Claims on 5th November created downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are NAB Business Confidence, US JOLTS Job Openings at Nov 10, OPEC Monthly Oil Market Report, Fed Governor Quarles Speech at Nov 11, Australia MI Inflation Expectations, US Initial Jobless Claims at Nov 12, and US PPI monthly report at Nov 13.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was 1.85% higher than the previous week. Maintaining high at 0.7289 and low at 0.6991 showed a movement of 298 pips.

In the upcoming week we expect AUD/USD to show a bullish trend.  The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 0.7371 may open a clean path towards 0.7479 and may take a way up to 0.7670. Should 0.7073 prove to be unreliable support, the AUDUSD may sink downwards 0.6883 and 0.6774 respectively. In H4 chart cup and handle pattern formation favors prospects of a bullish trend. Also to be noted Bullish engulfing formation exerts the expectation of uptrend for the pair.

Preference
Buy:  0.7242 target at 0.7478 and stop loss at 0.7068

 

Alternate Scenario
Sell: 0.7068 target at 0.6784 and stop loss at 0.7242