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Fear and the U.S. election

The dollar appreciated against most of its major rivals at the end of the week, as coronavirus-related concerns weighed on equities and the market’s mood. Several companies reported the close of their US stores amid resurgent coronavirus cases, with the focus in Florida, Texas, and in general, the region known as the Sun Belt. US President Trump refuses to go back into lockdown.

In general, data beat expectations but continued to show steep economic downturns worldwide.

The EUR/USD pair finished the week at 1.1175, around the 38.2% retracement of its latest daily advance. The GBP/USD pair established at 1.2350, both at their lowest levels since June 1st.

Commodity-linked currencies came under selling pressure at the end of the week, weighed by the sour tone of equities. Gold prices soared, with spot ending at $1,742.70 a troy ounce, although crude oil prices retreated alongside equities.

US President Trump kick-started its election rally last Saturday in Tulsa, Oklahoma. Once again, he blamed China on the global spread of coronavirus, calling COVID-19, “Kung-Fu.” According to data released the same day, the Republican National Committee raised $74 million in May for Trump’s campaign. Also, the campaign came under fire for using a symbol once used by Nazis in some Facebook ads — a red inverted triangle- that Facebook already removed.

https://www.fxstreet.com/news/forex-today-fear-and-us-election-202006211538



The Week Ahead – Geopolitics and June PMIs in Focus

For the Dollar:

It’s a busy week ahead on the economic data front.

We are now moving beyond April and May and getting end of 2nd quarter numbers that will influence risk sentiment. The numbers will also give the markets a view of what the economic recovery will look like.

Prelim June private sector PMIs are due out on Tuesday and expect the services PMI to have the greatest influence.

The focus will then shift to a busy 2nd half of the week.

On Thursday, the weekly jobless claims and May’s core durable goods orders will have the greatest influence.

At the end of the week, we don’t expect too much direction from inflation and finalized consumer sentiment figures.

According to Trading Central (3rd party RIA) the USDCHF short positions below 0.9650 with targets at 0.9375 & 0.9255 in extension.

* Past performance is not a guarantee of future performance

https://europefx.tradingcentral.com/Product?PK_ANALYSE=10786957

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 0.9375
1€ 2,981.51€ 1,490.76€ 1,361.55
5€ 14,907.57€ 29,815.15€ 6,807.75
10€ 29,815.15€ 59,630.29€ 13,615.50
25€ 74,537.87€ 149,075.73€ 34,038.75
50€ 149,075.73€ 298,151.46€ 68,077.50

For the EUR:

In the 1st half of the week, prelim June private sector PMIs for France, Germany, and the Eurozone will be in focus.

Expect the stats to have a material influence, with service sector PMIs likely to have a greater impact.

On Wednesday and Thursday, the focus will then shift to Germany. June’s IFO Business Climate Index and July’s GfK Consumer Climate figures are due out.

A pickup in both business and consumer confidence is needed to support the economic recovery.

The EUR/USD ended the week down by 0.69% to $1.1178.

According to Trading Central (3rd party RIA) the EURUSD is long positions above 1.1000 with targets at 1.1495 & 1.1565 in extension.

* Past performance is not a guarantee of future performance

https://europefx.tradingcentral.com/Product?PK_ANALYSE=10789812

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 1.1495
1€ 3,333.33€ 1,666.67€ 2,859.84
5€ 16,666.67€ 33,333.33€ 14,299.20
10€ 33,333.33€ 66,666.67€ 28,598.40
25€ 83,333.33€ 166,666.67€ 71,496.00
50€ 166,666.67€ 333,333.33€ 142,992.00

For the Pound:

It’s a quiet week ahead on the economic calendar.

Key stats are limited to June CBI Industrial Trends and prelim June private sector PMIs.

Expect the services PMI to garner the greatest interest on Tuesday. The UK economy has continued to struggle following a particularly dire April.

Last week’s BoE move failed to ease the pain so more will have to come from the British government.

Away from the economic calendar, expect Brexit negotiations to intensify, which should deliver a more volatile Pound.

The GBP/USD ended the week down by 1.52% to $1.2350.

According to Trading Central (3rd party RIA) the GBPUSD is long positions above 1.2335 with targets at 1.2810 & 1.3200 in extension.

* Past performance is not a guarantee of future performance

https://europefx.tradingcentral.com/Product?PK_ANALYSE=10786956

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 1.2810
1€ 3,683.24€ 1,841.62€ 4,111.02
5€ 18,416.21€ 36,832.41€ 20,555.10
10€ 36,832.41€ 73,664.83€ 41,110.20
25€ 92,081.03€ 184,162.06€ 102,775.50
50€ 184,162.06€ 368,324.13€ 205,551.00

For the Japanese Yen:

June’s Prelim private sector PMIs are due out in the 1st half of the week. We don’t expect too much influence from the numbers.

In the 2nd half of the week, June inflation figures will draw some interest.

For the Japanese Yen, however, expect support to continue should new COVID-19 cases continue to rise. Disappointing PMIs from the Eurozone and the U.S would also be Yen positive in the week.

The Japanese Yen ended the week up by 0.47% to ¥106.87 against the U.S Dollar.

https://www.fxempire.com/news/article/the-week-ahead-covid-19-numbers-geopolitics-and-june-pmis-in-focus-656451

According to Trading Central (3rd party RIA) the USDJPY is short positions below 109.65 with targets at 106.00 & 104.50 in extension.

* Past performance is not a guarantee of future performance

https://europefx.tradingcentral.com/Product?PK_ANALYSE=10786955

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 105.15
1€ 2,982.85€ 1,491.42€ 1,386.00
5€ 14,914.24€ 29,828.49€ 6,930.00
10€ 29,828.49€ 59,656.97€ 13,860.00
25€ 74,571.22€ 149,142.43€ 34,650.00
50€ 149,142.43€ 298,284.86€ 69,300.00