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xysoom · Registrato: Mag 15, 2020 Messaggi: 1676

Markets to expect the unexpected?

April has kicked off on a positive note with Asian shares marching higher as investors digest data from China and Japan. European markets are expected to open mixed ahead of a barrage of economic releases from the region, while US futures are green after the S&P 500 rallied overnight.To get more news about WikiFX, you can visit wikifx.com official website.

Risk sentiment was boosted by President Bidens “once in a generation” $2.25 trillion spending plan. Given his speech yesterday, this is certainly no April fools. According to the new President, the hefty spending will “create the strongest, most resilient, innovative economy in the world”. However, the ambitious plan will be funded with higher corporate taxes with Biden calling for the current rate of 21% to be hiked to 28%. This is probably the biggest sticking point with the new stimulus and may create resistance when the plan is discussed in Congress, so grab your popcorn and enjoy the show.

More trouble in Europe
Things are not looking pretty in Europe.A third wave of Covid-19 is sweeping through the continent, forcing countries to renew lockdown restrictions. One of the latest victims has been France which is struggling with a jump in Covid-variant cases. President Emmanuel Macron has announced a nationwide four-week lockdown that will commence in two days and go on until May 2. During this period, schools and businesses will be closed,something that will inflict more pain on the economy.

Fears around Europe losing control of the pandemic is likely to darken the economic outlook and result in a weaker Euro.Looking at the charts, the EURUSD remains under intense pressure on the daily timeframe. A solid breakdown below 1.1700 could open the doors to levels not seen early November 2020 around 1.1620.

OPEC to pull April fools？
Crude oil prices edged higher this morning, clawing back some of the previous sessions losses ahead of the OPEC+ meeting later in the day.

OPEC and its allies are widely expected to leave production targets unchanged despite the Covid-19 restrictions in Europe and Iranian crude oil exports to China. However, when dealing with OPEC+ it may be wise to expect the unexpected. Saudi Arabia has already stunned markets this year and any surprise moves could catch investors off-guard today.

Should todays meeting go by the book, oil markets may offer little reaction as this was already widely expected.

Commodity spotlight – gold
After rebounding from the $1680 support level, gold bulls seem to be on a mission to retest the $1730 level. While a softer dollar may support upside gains, the improving market mood and jump in risk-sentiment may ensure prices remain depressed. The precious metal is likely to oscillate within the $1680 to $1730 regions ahead of the US jobs report on Friday.