(14 April 2020)DAILY MARKET BRIEF 2: Gold above $1700 per oz.

(14 April 2020)DAILY MARKET BRIEF 2: Gold above $1700 per oz.

14 April 2020, 09:24
Jiming Huang
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Gold started the week with a heavy rise in demand. The price of an ounce cleared the $1700 offers as investors piled into the precious metal in preparation for potentially hectic price moves over the coming days and weeks.

US treasuries remain bid, with the 10-year US treasury yield below the 0.80% mark. But the US dollar slipped below the 100-mark leaving some space for G10 to advance.

The USDJPY retreated to 107.50.

The EURUSUD is preparing to test the 50-day moving average (1.0962), if surpassed, should encourage a further rise toward the 1.10 mark.

Cable cleared its 50-day moving average (1.2550) and is set to challenge the 200-day moving average (1.2715) on the back of a softening US dollar.

Elsewhere, oil currencies are better bid despite the little convincing OPEC+ decision.

After a series of heated teleconferences over four days, OPEC+ finally agreed to curb production by a historical 9.7 million barrel per day. The US, Brazil and Canada will cut another 3.7 million barrel per day. Together, the total drop in oil production is around what investors were hoping for, but with the coronavirus-led slowdown taking a toll on the global oil demand, the supply side news could be rapidly forgotten. WTI crude trades below the $23 mark per barrel, confirming that the historic cut didn’t spark the market reaction that oil producers were hoping for. Not only that the OPEC+ cut remained a touch below the lower range of expectations, but more importantly, wide controversies among oil producer nations hinted that a further action is probably unlikely. Hence, oil is left to its destiny this week and should find a direction based on the overall market mood, that will be mostly set by economic data and company results over the coming weeks.

By Ipek Ozkardeskaya

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