Asian stocks and American and European futures dropped as the fallout over Coronavirus continued. In Asia-Pacific, the ASX, Shanghai, and A50 dropped by 7.8%, 2.55%, and 2.88% respectively. In the US, futures tied to the Dow, Nasdaq, and S&P500 have dropped by more than 4%. Part of the reason is that negotiations about a big $2 trillion spending stimulus failed in the US senate. Only 47 senators voted for the deal. Democrats blamed the deal for having large corporate bailouts with no protection for workers. This now leaves the country in a state of confusion at a time when many companies, especially airlines and restaurants, are struggling.
The price of crude oil declined as traders continued to worry about demand and supply. On demand, traders are worried that the current global shutdowns will lead to a low demand of the commodity. On supply, they are worried about high volume coming from countries like Saudi Arabia and Russia. This weekend, the Wall Street Journal reported that US oil executives had started talks with the Saudis. Still, it is not clear whether Saudi leaders, who have never loved US shale producers, will agree to slash production.
The price of gold was relatively unchanged during the Asian session as traders reflected on the impact of Covid-19. The price of gold, which is considered a safe-haven, has declined in the past few weeks as investors sell their holdings to cover margin calls in stocks. We have also seen low demand from institutional investors, who have seen their stocks holdings wiped out. The same is true with Bitcoin, which dropped by more than 6% in the Asian session.
The EUR/USD pair rose slightly from an intraday low of 1.0635 to the current high of 1.0727. On the 30-minute chart, the volume being traded has increased while the price has moved slightly above the 14-day and 28-day exponential moving averages. The pair may continue rising to test the important resistance level 1.0753, which is shown in pink below.
The XBR/USD pair declined by more than 3% as traders continued to worry about demand and supply. The pair is trading at 27.86, which is slightly higher than the intraday low of 27.34. The price is slightly below the 14-day and 28-day exponential moving averages. The RSI and the signal line of the MACD have been falling. The pair may continue declining unless a deal is reached between the US and Saudi Arabia.
The BTC/USD pair declined to an intraday low of 5585.05 as most traders moved to cash. The pair is trading below the 14-day and 28-day exponential moving averages on the hourly chart. The price is also along the important support line shown in pink below. The signal line of the Chaikin oscillator is along the centreline. The pair will likely continue being volatile as the fallout about coronavirus increase.