Daily Market Outlook, April 13, 2020

<p><b>U.S. futures dropped, while Asian open saw mixed sentiment in Japan, South Korea, and China. </b><span>USD dropped after OPEC+ agreed to cut 9.7 million barrels a day from the global crude output. Risk appetite is neutral on Monday with the Asian equity market mixed after a celebration of an oil production cut. JPY is picking up and commodity currencies are heading south. Treasuries were little changed. The EUR steadies after France, Germany, Italy, and Spain reported a slowdown in new coronavirus cases. </span></p>
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<p><b>The world’s top oil producers finally struck a historic deal to cut global petroleum output</b><span> by nearly a 10th, putting an end to the price war between Saudi Arabia and Russia. </span><b>The OPEC+ has agreed to reduce output by 9.7 million barrels per day </b><span>for the coming May and June, after four days of talks. U.S. President Trump added pressure by threatening leader Saudi Arabia with oil tariffs and other measures if it did not fix the market’s oversupply problem. Oil price pared gains on Monday after Brent oil surged to $36.30 during the meeting. However, OPEC has expected the global oil demand to plunge 20 million barrels a day, almost double the 9.7 million barrels a day cut agreed. </span><b>Although the deal provided some stability, the supply and demand imbalance is capping the upside of oil prices. </b></p>
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<p><b>CAD strengthened against USD due to the OPEC+ deal reached</b><span>. The Bank of Canada rate meeting is scheduled this week on the economic calendar and is expected to keep rates on hold. However, markets will be laser-focused on the rhetoric surrounding the central bank’s outlook for the economy and subsequent implications for quantitative easing measures pertaining to COVID-19. We could see enlarged volatility in the market ahead of the BOC rate meeting.</span></p>
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<p><b>Gold edged higher towards 1703.70- the peak it marked in recent equity market turmoil.</b><span> Investors have fled to the safe haven as most of the economies are facing extended shutdowns. According to Fed Bank of Minneapolis President Neel Kashkari, the U.S. economy could face 18 months of rolling shutdowns as the outbreak recedes and flares up again. Meanwhile, some of the worst hit countries are seeing slowing infections. Countries including Spain, Italy, and France reported fewer new cases, and the government is actively thinking of ways to safely ease shutdowns. Still, without an effective vaccine for the virus, the market sentiment is generally cautious, buoying XAUUSD. </span><b>Overall, the market has shown some green shoots of slowing infections, but safe-haven assets are likely to remain supported in times of uncertainties. </b></p>
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<p><b>The market is expecting manufacturing activities to pick up among a consistent decline in copper inventories in China.</b><span> Holdings of copper shrank for a fourth week, and are now 16% lower than the near-record peak that was hit in mid-March. This provided some hope that the global economy has bottomed with China speeding up manufacturing.</span></p>
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<p><b>Technical &amp; Trade views</b></p>
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<p><b>USDCAD (</b><b>Intraday bias: Bearish below 1.3945 neutral above)</b></p>
<p><img class="aligncenter size-large wp-image-41633" src="http://blog.tickmill.com/wp-content/uploads/2020/04/usdcad1-1024×459.png" alt="" width="1024" height="459" srcset="https://blog.tickmill.com/wp-content/uploads/2020/04/usdcad1-1024×459.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/04/usdcad1-300×135.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/04/usdcad1-768×344.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/04/usdcad1.png 1057w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>We are seeing the price to test the downside confirmation at 1.3945. The downside confirmation is a confluence level of horizontal swing low. If price breaks below the downside confirmation, it will open up a bigger drop  towards 1st support which happens to be where the 100% fibonacci extension and horizontal swing low line up well. </span></p>
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<p><b>UKOIL (</b><b>Intraday bias: bullish above 31.10 bearish below)</b></p>
<p><img class="aligncenter size-large wp-image-41634" src="http://blog.tickmill.com/wp-content/uploads/2020/04/ukoil1-1024×465.png" alt="" width="1024" height="465" srcset="https://blog.tickmill.com/wp-content/uploads/2020/04/ukoil1-1024×465.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/04/ukoil1-300×136.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/04/ukoil1-768×349.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/04/ukoil1.png 1071w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
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<p><span>We turn bullish for today’s trading.  We are seeing the price approaching 1st support. 1st support happens to be where the 50% Fibonacci retracement and 61.8% Fibonacci extension line up well.1st resistance is where the 78.6% Fibonacci retracement and previous swing high are.  Currently the Ichimoku cloud is also sending mixed signals where price is likely to cross above the cloud and bounce further. </span></p>
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<p><b>XAUUSD ( </b><b>Intraday bias: Bearish below 1701.08 bullish above) </b></p>
<p><img class="aligncenter size-large wp-image-41635" src="http://blog.tickmill.com/wp-content/uploads/2020/04/xauusd1-1024×466.png" alt="" width="1024" height="466" srcset="https://blog.tickmill.com/wp-content/uploads/2020/04/xauusd1-1024×466.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/04/xauusd1-300×136.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/04/xauusd1-768×349.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/04/xauusd1.png 1055w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>We remain bearish technically as the price is approaching 1st resistance at 1701.08 and is likely to reverse from there.1st resistance is where the 78.6% fibonacci extension and previous horizontal swing high are. Ichimoku cloud is showing a further pushup towards 1st resistance is possible before a deep drop. Price is likely to reverse at 1st resistance towards 1st support at 1641.82. The 1st support happens to be where 38.2% Fibonacci retracement and horizontal overlap support line up well and could serve as a key support level. </span></p>
<p><b>XCUUSD ( </b><b>Intraday bias: Bullish above2.4179 neutral below)</b></p>
<p><img class="aligncenter size-large wp-image-41636" src="http://blog.tickmill.com/wp-content/uploads/2020/04/xcuusd1-1024×464.png" alt="" width="1024" height="464" srcset="https://blog.tickmill.com/wp-content/uploads/2020/04/xcuusd1-1024×464.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/04/xcuusd1-300×136.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/04/xcuusd1-768×348.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/04/xcuusd1.png 1057w" sizes="(max-width: 1024px) 100vw, 1024px" /></p>
<p><span>Our call is still valid. We remain bullish  as price broke above our previous upside confirmation at 2.24386. Now price is approaching our new upside confirmation at 2.3375 where the important horizontal overlap resistance is. If price breaks above the upside confirmation, it will open up a bigger bounce. Our previous upside confirmation is now our 1st support, where the 50% fibonacci retracement and horizontal overlap support happen to line up well.</span></p>
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