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China GDP & emergency use vaccine

EUR/AUD – Daily Candlesticks
Source: GKFX / MT4 (October 18, 2020)

EUR/AUD has calmed down following a very volatile start to the year. The top of its current tight trading range sits just below 1.66, where a break could mark the start of a new uptrend.
 

TAKEAWAYS


•    Pound volatile: Brexit hangs on a thread
•    Pfizer applies for COVID-19 vaccine emergency use 
•    Remdesivir has “little to no effect” says WHO
•    NZD: Jacinda Ardern wins landslide New Zealand election
•    Q3 Earnings: IBM, Halliburton
•    DAY AHEAD: China GDP, China retail sales & industrial production, Powell speech
 

GURU WISDOM


“How you gonna win if you ain’t right within?” – Lauryn Hill
 

MARKETS


Rising virus cases are weighing on stocks in Asia as traders look to an avalanche of economic data from China – including Q3 GDP. European markets pulled off a strong rebound on Friday but still ended down from Thursday’s drubbing. Stocks on Wall Street snapped a 3-day losing streak – the first such occurrence this month.

The New Zealand dollar could be in focus on Monday after current Prime Minister Jacinda Ardern won a landslide election over the weekend- as New Zealanders rallied around her and her response to the pandemic. 

 A surprisingly strong US retail sales report saw the US dollar (acting as a haven) turn lower on Friday. September sales jumped 1.9% compared to 0.7% expected and the 0.6% in August. However, tightening virus restrictions in Europe and a lack of US fiscal stimulus helped the buck to its best week in three.

After a sharp drop to start the week gold and silver stabilised at $1900 per oz and $24 per oz respectively. WTI crude saw buying near $40 per barrel in a choppy week that saw prices basically go sideways.
 

Australian Brexit


A stand-off has begun between the EU and UK – each stating it is the other that needs to ‘move’ on its trade negotiating demands. The net result was the UK’s Boris Johnson saying Britain should get ready for an ‘Australia-style’ trading relationship with the EU – namely trading via WTO rules without a deal. 
 

Stimulus vs. Earnings


A strong first week of Q3 US corporate earnings got sidelined by virus cases and stimulus talks. That means the bad news trumped the good news. House Speaker Nancy Pelosi signalled a willingness to work on it on Friday then over the weekend gave the White House two days to come up with an alternative to the $2.2trillion deal already passed in the House of Representatives. Democrats and Republicans are fighting over who will get credit for any deal or blame for no deal before the election.
 

COVID latest


It was a mixed bag of news on coronavirus treatments on Friday. Pfizer has been producing its COVID-19 vaccine in the hopes its application for emergency use will be approved. The company released a video of the vials coming off the production line. Offsetting the good news was that the WHO concluded after its own trials that Remdesivir has” little to no effect” in reducing COVID-19 deaths.
 

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