 The second wave of coronavirus pandemic had finally become a main theme in the markets last week. Or, investors could have just waited for Fed to confirm its done with more easing for moment, and started profit taking. Either way, massive selloff was seen in the stock markets towards the end of the week. In the currency markets, Yen and Swiss Franc ended as overwhelmingly the strongest, followed by Dollar and Euro. Australian Dollar was the worst performing, and led commodity currencies and Sterling lower. We're preferring the case of reversing the unjustifiably strong rebound in stocks since late March. But a near term support zone in DOW needs to be taken out to confirm. AUD/JPY will be watched as confirmation of overall risk sentiments again and a corresponding support zone needs to be broken decisively too. As for Dollar's come back, the DXY also needs to overcome a near term resistance level. The levels are discussed below. As for the coronavirus pandemic, as it's said, the second wave is still "small" and "distant" for some parts of the US. But situations in some countries look out of control. Those countries that worth attention included Mexico, Brazil, India, Pakistan and Saudi Arabia. |
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