Daily Market Outlook, June 24, 2020
<h2><span>Daily Market Outlook, June 24, 2020 </span></h2>
<p><span><strong>Sentiment was mixed during the Asian market session</strong>. Yesterday’s PMI reports reaffirmed expectations of a global economic recovery at least in the near term. However, reports of rising Covid-19 cases in parts of US, including Texas, Florida and California, weighed on risk appetite. Elsewhere, the Reserve Bank of New Zealand kept interest rates unchanged at 0.25%, as expected, but noted it is “prepared to use additional monetary policy tools as needed”, which weighed on the kiwi dollar.</span></p>
<p><span><strong>Germany’s IFO business survey for June is the main economic data release today</strong>. After falling sharply in March and April, last month saw the headline index rise 5.3 points to 79.5 (still well below pre-pandemic levels), reflecting a rebound in the expectations component. Watch for potential improvements in both current conditions and future expectations indices in today’s report and an increase in the headline IFO index to 84.0. The risk may be skewed to the upside following yesterday’s flash PMIs which signalled the economic recovery was proceeding more quickly than expected.</span></p>
<p><span><strong>The International Monetary Fund (IMF) is scheduled to provide an update to its World Economic Outlook at 2pm (UK time).</strong> The previous report in April predicted a fall in world output of 3% this year. That estimate is likely to have been too optimistic and, judging from consensus forecasts and the recent OECD update, a downward revision seems likely. The IMF also previously predicted a growth rebound of 5.8% in 2021, so it will be interesting to see if it remains as bullish.</span></p>
<p><span><strong>A few central bank speakers will make scheduled appearances today, including ECB Chief Economist Philip Lane this morning.</strong> This evening sees the Chicago Fed President Charles Evans and St Louis Fed President James Bullard discuss Covid-19, the economy and monetary policy. Bullard yesterday said the economy is bouncing back although he was concerned about persistently high unemployment. He was also sceptical about adopting yield curve control, noting that interest rate expectations are already very low.</span></p>
<p><span><strong>Yesterday,UK PM Boris Johnson confirmed that lockdown restrictions would be eased further in England on 4 July</strong>. That included a change to the 2-metre distancing rule to ‘1 metre plus’, while pubs, restaurants and museums, among other establishments, can reopen.</span></p>
<h3><b>Today’s Options Expiries</b><span> for 10AM New York Cut (notable size in bold)</span></h3>
<ul>
<li><span>EURUSD: </span><span>1.1245 (410M), 1.1290 (454M), 1.1300 (665M), 1.1400 (410M)</span></li>
<li><span>AUDUSD 0.6770 (450M)</span></li>
<li><span>USDJPY:</span> <span>106.00-10 (405M), 106.25-35 (350M), 107.00 (655M)</span></li>
</ul>
<h3><span>Technical & Trade Views</span></h3>
<p><b>EURUSD Bias: Bullish above 1.1170 targeting 1.15</b></p>
<p><span>From a technical and trading perspective, as symmetry swing support at 1.1170 supports there is a window for fresh demand to take prices higher again to retest cycle highs above 1.14 enroute to an ultimate retest of year to date highs at 1.15. However, it is noteworthy that the daily volume weighted average price has flipped bearish as such a failure to hold support at 1.1170/50 would open a deeper corrective phase to rest bids back to 1.10 UPDATE prices have reversed from the equality support objective, printing a bullish key reversal candle yesterday opening a window for a retest of cycle highs above 1.14. UPDATE As yesterday’s highs cap there is the potential for a pullback to retest bids to 1.1250 before the next leg higher may develop </span></p>
<p><img class="aligncenter size-full wp-image-45840" src="http://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58.png" alt="" width="2145" height="1236" srcset="https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58.png 2145w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58-300×173.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58-1024×590.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58-768×443.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58-1536×885.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.54.58-2048×1180.png 2048w" sizes="(max-width: 2145px) 100vw, 2145px" /></p>
<p><b>GBPUSD Bias: Bullish above 1.24 targeting 1.27</b></p>
<p><span>GBPUSD From a technical and trading perspective, 1.2324 equality downside objective achieved, buyers have stepped in and as this level is defended look for a move to test descending trendline resistance at 1.25. Bearish reversal patterns in this area would set up a move to retests and ultimately erode support at 1.2320 opening a move to test 1.21. On the day only a close back through 1.2510 would suggest a more meaningful low is in place for another attempt to take out stops above 1.28 UPDATE the daily chart has flipped bullish as per the volume weighted average price, expect some supply around the symmetry swing resistance at 1.2570 as 1.2450 continues to support bulls will target a test of offers and stops above 1.27</span></p>
<p><img class="aligncenter size-full wp-image-45841" src="http://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40.png" alt="" width="2158" height="1238" srcset="https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40.png 2158w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40-300×172.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40-1024×587.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40-768×441.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40-1536×881.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-07.57.40-2048×1175.png 2048w" sizes="(max-width: 2158px) 100vw, 2158px" /></p>
<p><b>USDJPY Bias: Bearish below 107 targeting 105</b></p>
<p><span>USDJPY From a technical and trading perspective, sharp rejection above 109.50 suggests a return to range trade and a retest of support back to 107 UPDATE target achieved as 108 caps upside attempts bears will play for a test of year to date lows to 106 UPDATE target achieved as 107 symmetry swing resistance contains corrections look for a move to test the pivotal 105 next</span></p>
<p><img class="aligncenter size-full wp-image-45842" src="http://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59.png" alt="" width="2154" height="1234" srcset="https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59.png 2154w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59-300×172.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59-1024×587.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59-768×440.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59-1536×880.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.01.59-2048×1173.png 2048w" sizes="(max-width: 2154px) 100vw, 2154px" /></p>
<p><b>AUDUSD Bias: Bearish below .6900 Bullish above)</b></p>
<p><span>AUDUSD From a technical and trading perspective, after the rejection from above the .7050 level and the subsequent failure to hold .6900 as support, anticipate a test of the corrective equality objective back to .6650. Only a close back through .6910 would reignite bullish spirits suggesting the current correction is complete opening another run to test offers and stops above .7050</span></p>
<p><img class="aligncenter size-full wp-image-45843" src="http://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33.png" alt="" width="2151" height="1237" srcset="https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33.png 2151w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33-300×173.png 300w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33-1024×589.png 1024w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33-768×442.png 768w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33-1536×883.png 1536w, https://blog.tickmill.com/wp-content/uploads/2020/06/Screenshot-2020-06-24-08.03.33-2048×1178.png 2048w" sizes="(max-width: 2151px) 100vw, 2151px" /></p>
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