Today I will begin the review with the appearance of extremely shocking information from the Harvard School of Public Health. According to a study, or rather a report published yesterday, the United States may need to continue quarantine measures until 2022. This may be needed if the number of hospital beds for intensive care is not significantly increased or if a vaccine is not available.
As we see today, the demand for riskier assets as well as commodity currencies, has fallen dramatically. In the list of commodity currencies, I include AUD and NZD, since these countries are highly dependent on the export of raw materials to China. CAD is also sensitive to changes in oil prices. All these currencies have dropped today, but have since stabilized.
And now let us consider in more detail the situation in the oil market to understand the future movement, with which the CAD will be closely tied. Let me remind you that the deal between OPEC+ and other countries that support the organization will not compensate for the reduced demand. In support of this, the International Energy Agency (IEA) published a report that shows oil reserves are growing by 12 million barrels per day. All this contributes to lower oil prices and most likely the trend will continue in the coming days.
As a result, the CAD is likely to weaken, and the USD/CAD currency pair may also fall further, even taking into account the latest correction that has occurred. Thus, I do not exclude the possibility of a more powerful wave of growth and the pair's return to 1.4060–1.4080.
Moving to the American trading session, I will mention the upcoming publication of reports for retail sales figures and industrial production. If the numbers come in below expectations then pressure on USD will increase, thereby weakening the activity of sellers of the AUD/USD and NZD/USD, as well as buyers of USD/CAD.
Nevertheless, expectations of when the US and Europe can resume business activity remain more significant for the markets. After all, everyone understands that the economic situation is now catastrophic and will remain so until a significant reduction in quarantine measures happens around the world.
The above review is not a direct guide to trading, and can only be classed as recommendations.
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#MarketWatch
As we see today, the demand for riskier assets as well as commodity currencies, has fallen dramatically. In the list of commodity currencies, I include AUD and NZD, since these countries are highly dependent on the export of raw materials to China. CAD is also sensitive to changes in oil prices. All these currencies have dropped today, but have since stabilized.
And now let us consider in more detail the situation in the oil market to understand the future movement, with which the CAD will be closely tied. Let me remind you that the deal between OPEC+ and other countries that support the organization will not compensate for the reduced demand. In support of this, the International Energy Agency (IEA) published a report that shows oil reserves are growing by 12 million barrels per day. All this contributes to lower oil prices and most likely the trend will continue in the coming days.
As a result, the CAD is likely to weaken, and the USD/CAD currency pair may also fall further, even taking into account the latest correction that has occurred. Thus, I do not exclude the possibility of a more powerful wave of growth and the pair's return to 1.4060–1.4080.
Moving to the American trading session, I will mention the upcoming publication of reports for retail sales figures and industrial production. If the numbers come in below expectations then pressure on USD will increase, thereby weakening the activity of sellers of the AUD/USD and NZD/USD, as well as buyers of USD/CAD.
Nevertheless, expectations of when the US and Europe can resume business activity remain more significant for the markets. After all, everyone understands that the economic situation is now catastrophic and will remain so until a significant reduction in quarantine measures happens around the world.
The above review is not a direct guide to trading, and can only be classed as recommendations.
=========
#MarketWatch
