Pound sinks below 1.20 in worsening coronavirus market crisis
SWING TRADING SIGNAL – GBP/USD – SELL @ 1.20
The pound gets hammered by deterioration in global risk sentiment. The currency has experienced yet another day of deep downhill momentum against majority of the worlds currencies with losses coming not only against the Euro and Dollar, but also against other currencies which it has in the past tended to advance against in the current market conditions such as the Canadian Dollar and Australian Dollar.
The last time the Pound-to-Dollar exchange rate was this law was back in 1985. "Sterling has completed one of its steepest declines in memory by hitting its weakest level since 1985, excluding if you will the brief dive of the Oct 2016 'flash crash'," says Neil Wilson, Chief Market Analyst
The pound has suffered heavily in the wake of the coronavirus crisis. The current weakness is actually vert common with the 2008 market crash. When investors are running scared the pound tends to suffer. This is due to the fact that the UK runs a persistent current account deficit, which means it is importing more than it exports. So due to this reason, the pound is very sensitive to global investor meltdowns.
U.S Dollar Index breaks above 100.0
SWING TRADING SIGNAL – EUR/USD – SELL AT 1.1050
The U.S Dollar index (DXY) which tracks the greenback vs a bundle of its main rivals (EUR = 56.7%) Is trading to the upside at nearly 3 year highs at the 100.8 region.
We have observed increasing buying pressure around the greenback in combination with high demand which is stemming from weakness in its competitors like the Euro and British Pound. We are currently observing DXY advancing 1.27% at 100.8 and a breakout above 101.0 could poteintaly lead to a re-test of major tops at 103.8