Yesterday did not differ much from Friday In terms of market activity. And this is not surprising, since Europe continued to rest, and formally, Monday was a public holiday. Although in conditions of widespread quarantine and other restrictive measures, whether it is a holiday or not, there is no difference. The vast majority of people still sit at home, even though financial markets continue to function, as before. But on holidays, the markets still do not work. And in theory, the market was supposed to win back Friday's data on inflation in the United States since the opening of the American session. However, the market behaved as if there was no sharp decline in inflation. In general, at least some activity was observed only in the single European currency, and it coincides with the receipt of information about the agreement to reduce the volume of oil production in a strange way. The negotiations themselves seemed to end on Sunday, but there was no clear specificity regarding the parameters of the agreement. There were discrepancies even on the issue of production cuts, which ranged from 10 million barrels to 19 million barrels. In other words, it was perfectly clear to everyone that many fundamentally important issues remained unresolved. Naturally, against this background, oil continued to fall in price, and the dollar went up. But by late afternoon, all questions were closed. It turns out that the largest oil exporters have agreed to reduce production by only 9.7 million barrels per day. However, this does not prevent you from continuing to call it the largest transaction in history. In addition, if it was initially assumed that the reduction in production would be effective for two years, then in the end, the deal was concluded for a period of two months. And although we talked about a much larger reduction in production volumes at first, at least some specifics were enough to give the markets a little optimism. Oil immediately began to rise in price. And with it, a single European currency. But because of the holiday in Europe, the scale of the movements was not so impressive. Surprisingly, the pound stood still in contrast to the single European currency and only began to grow in the evening following the single European currency.
At the same time, the market did not react at all to the situation with coronavirus in the United States, where there has been a steady decline in new cases of coronavirus infection for more than a day. But this situation has already led to the discussion that the quarantine may be lifted earlier than planned. And it's kind of an incredibly positive situation. However, it is too early to rush to conclusions, since exactly the same situation began in Europe with new cases of coronavirus infection, but no one is going to cancel any restrictive measures. And the thing is that the situation remains critical after passing the peak and a certain reduction in the number of new infections. The number of new cases of infection does not continue to decline and does not tend to zero. Therefore, there is no reason for crazy joy.
However, it is precisely today that the market will most likely react sharply to reports regarding the coronavirus. Holidays in Europe are over, which means everything is assembled. But the problem is that the macroeconomic calendar is completely empty. Yes, just like yesterday. Although yesterday, at least there could be at least some reaction to inflation, published on Friday. To date, this is a fully developed issue. Accordingly, market participants do not have any guidelines at all. They won't appear until tomorrow, but it will be only tomorrow. Therefore, today, market participants have no choice but to work out the information background. If there is one, of course.
The EUR/USD currency pair continues to move horizontally, where the original accumulation framework of 1.0920/1.0950 was overcome, and a new amplitude of 1.0893/1.0967 came in its place. It can be assumed that the fluctuation in the given boundaries will remain in the market, but it will be temporary.
The GBP/USD currency pair managed to restrain the upward mood, eventually overcoming the Friday accumulation of 1.2440/1.2485, on the basis of which the main level of 1.2500 was overcome. It can be assumed that the slow down of the market will not end there and the current day will be expressed in a variable fluctuation between the values of 1.2500/1.2580.
