What’s going on?
The Financial market risk sentiment has been deteriorated further after Trump imposes an additional $200billion in Chinese products. Tremors spread across the board as Risk-off mood escalated from Wednesday Asian session to NY session.
Here’s a glance at the best & worst performers:
With Yen appreciation against the most traded currencies, Equities skid, FX weakened and the commodities melted were the themes on Wednesday.
FX Scoreboard (Base currency: USD):
TRY weakened 3.5% followed by ZAR 1.80%, CNH nearly a percent, MXN 0.90% respectively. In the G10 block, AUD and NZD were the weakest down 1.2% each, followed by JPY and SEK 0.90% each and CAD 0.80% respectively.
There is a strong inverse correlation between the greenback and the commodities. As a result, precious metal and the industrial commodities hammered.
Downward pressure continues:
Scoreboard: Brent oil plunged by 5.00% followed by Copper 3.00%, Platinum 2.5%, Silver 1.50% and finally Gold down by a percent (Wednesday closing).
Overview: At the time of preparing the article TRY fell as low as 4.9734 in an early Asian bid against the dollar.
Our bullish forecast on USDJPY has been doing well, trading at 111.95.
After Trump imposes an additional $200billion in Chinese products, USDCNH popped into early July high in the Asian session and later further extended the gains in NY session. We believe the cross has entered the supply zone, worth to observe for a reversal. Now the conviction factor is low.
All we can say is AUDJPY, AUDUSD, USDCNH, and Copper prices directly associated with the Trade-War.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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