Wall Street rallied yesterday as investors remained optimistic about the $2.2 trillion packages that was passed by the Senate yesterday. The Dow rose by more than 1,300 points, capping its biggest three-day gain since 1931. The S&P500 and Nasdaq each rose by more than 5%. The gains came on the same day that the Labour Department released the worst jobless claims in history. These claims did not move the market because they were already priced-in. Today, the focus will be on Donald Trump, who has been reviewing the options of reopening the country.
Chinese stocks rose today even as the country released weak industrial data. Numbers from the National Bureau of Statistics (NBS) showed that profits earned by the country’s industrial sector declined by more than 38% in the first two months of the year. The profits declined to $58.15 billion after rising by about 6% in December. The profits declined as most companies remained unproductive in the first part of the year because of Coronavirus. Economists and market watchers expect the industrial productivity in the country to start stabilizing as more firms reopen their operations. Shanghai and A50 indices rose by 0.72% and 0.91% respectively.
The economic calendar will be relatively light today. The main data to watch out for will be the house price index numbers from the UK. These numbers are expected to soften as more people hold off purchasing homes in a time of crisis. From the US, we will receive personal consumption and income data for February. These numbers measure how consumers are spending their income. However, the data will not have a major impact on the financial market because the economic situation has had major changes since February.
EUR/USD
The EUR/USD pair continued to rally after the US released weak jobless claims data. The pair is now trading at 1.1067, which is its highest level since March 17. On the hourly chart, this price is slightly above the 50% Fibonacci Retracement level. It is also slightly above the 14-day and 28-day exponential moving averages while the RSI has moved to the overbought level. The pair may continue to rise, with the next target being the 38.2% Fibonacci level at 1.1155.
GBP/USD
The GBP/USD pair rose to an intraday high of 1.2270 in the Asian session. This is significantly higher than when it started the week at 1.1410. The price is above the 14-day and 28-day moving averages and above the Ichimoku cloud. The RSI has moved above the overbought level of 70 also. This means that the pair may continue rising, with the next support being at 1.2350.
AUD/USD
The AUD/USD pair rose to an intraday high of 0.6115 as the dollar weakness continued. The pair is trading at its highest level since March, 17 this year. As with the EUR/USD and GBP/USD pair, the price is trading above the 14-day and 28-day exponential moving averages. It is also above the important support shown in yellow below. The pair may continue to rise today, with the next level to watch being 0.6200.
