Daily summary: Coronavirus in focus once again

  • Coronavirus fears hit the market sentiment
  • Stock indices launched a correction move
  • EURUSD plunged below 1.0850
  • EURGBP is trading near December lows
  • Headline price growth in the US accelerated to 2.5% YoY in January from 2.3% YoY in December

The markets are dominated by news from China today, moods in the Asian and European sessions were poor and the opening on Wall Street was also weak. US major indices started today’s session lower as the markets reacted to the increased number of confirmed cases of Coronavirus and higher death toll in China. In the first hours of trading the session is still negative but much of the decline has been recovered which could lead to believe traders weren't as affected by the news.

EURUSD is trading lower today, the declines extended after US data which showed the acceleration in headline price growth in the US. The pair plunged to almost 3-year low following a break below 1.0900. On the other hand one can see that GBPUSD is performing well, the pair broke above the psychological barrier at 1.30 USD.The pound is gaining after the resignation of the Chancellor the Exchequer Sajid Javid.

GBPUSD reached the resistance area at 1.3070 marked with the 61.8% Fibonacci retracement of the downward move started at the beginning of February and previous price reactions.The nearest support to watch is the lower limit of Overbalance structure (red rectangle). In case of a bigger correction buyers may also appear at 1.30 USD.

GBPUSD H1 interval. Source: xStation5

Economic calendar: UK supplementary budget and EIA report
Morning wrap
Daily summary: Stocks decline while gold is approaching the $1,800.00 mark
Daily summary: European shares decline in quiet trading session
Coronavirus: market update
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