The top 5 Factors That Affect Forex Trading.

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what affects forex trading?

The top 5 factors that affect forex trading

Deciding to invest in the foreign exchange market is the first step to becoming wealthy. However, this investment is not all roses and diamonds. Today’s exchange rate is almost certainly different from what it will be tomorrow because numerous factors affect forex trading, which I will sensitize you about. 

Some of the factors that affect forex trading have a more significant effect on the exchange rate compared to others. For this reason, I have compiled the top five factors which influence the exchange rate to educate you and make you a better investor than before.

Having this information will not only increase your knowledge base but also help you to understand the things to look out for to avoid making a blunder. Below are the top five factors which influence exchange rate;

  1. International trade

If you have been asking yourself what affects the forex market, then you should know that the main factor is the trade between countries, which happens daily. The importance of exchange rate in international trade is because the amount of commerce that one country does with another automatically affects the local currency.

If, for instance, your country exports more items than it imports, it is said to have a trade surplus, which in turn increases the currency value. The increased value is because of the increased revenues, which means that there is a higher demand for the country’s currency.

When a country exports less than it imports, it has a trade deficit. This means that the value of its currency decreases due to decreased revenues. In turn, the exchange rate depreciates. The importance of the exchange rate in international trade, therefore, cannot be overlooked. 

As an expert trader, I can also advise you to be aware of your country’s current account, which shows the balance of earnings versus trade. If the current account has a deficit, the government is spending more on imports and making less on exports, which leads to a trade deficit.

  • Natural disasters or phenomena

What are the five major factors that influence foreign exchange rates? Natural disasters or phenomena that affect the world have a great impact on the value of different currencies. In 2020, for example, you and I have already witnessed the effects of the COVOD-19 outbreak.

Disasters such as earthquakes, tsunamis, novel diseases, floods, and the like instantly affect the currency of any country. How global events can affect the foreign exchange market? When these events occur, the citizens and residents of the affected region, spend less money on investments to deal with the prevailing circumstances. Some of them are rendered unable to continue investing because of the loss of jobs. The loss of loved ones also shifts attention from investing to grieving. 

The affected government also redirects its funds to salvaging the country instead of conducting international trade. In such moments, all political leaders unite on a common mission to rescue their people. They use a lot of money to mitigate the impact of the catastrophe. The central bank shifts its attention from making significant monetary exchanges to provide the basic amenities for its citizens to rebuild their lives.

  • Political instability and government policies

Political instability and government policies impact of exchange rate fluctuations in various ways. Every year, the government comes up with a well-deliberated annual budget that dictates the amount of money that will be spent on different industries. As a result, the country’s currency is affected.

One of the other top factors that affect the value of money is the central bank of a country, which invests and moves hefty sums of money around. Each decision made by the central bank has the power to change the value of the country’s currency.

On the other hand, the political leadership of a country can significantly alter the value of a specific currency. Some leaders from certain countries are believed to be one of the causes of currency depreciation, while others are more beneficial to the forex market. As an expert in Forex trading, I can say with certainty that most brokers closely monitor national elections to predict what will happen to a particular country economically.

How does news affect the Forex market? A good forex trader knows the importance of monitoring news, especially political news and any changes in economic policies. This is because even small changes in rules can have a significant impact on markets. If civil war erupts in a country, for instance, its economy is affected within minutes, which could potentially make you lose your investment if you are not careful.

  • Economic factors

The economic status of a country influences the value of its currency, and it can be one of the causes of currency appreciation or otherwise. All expert traders will tell you that you should study your country’s debt ratio, employment rate, purchasing power, gross domestic product, and even the interest rates. When you fail to do this research, I can assure you that you risk losing your investment.

How does Forex affect economy? It primarily influences capital flows. You should not invest in countries with a deteriorating currency. If you notice some dwindling in the value of your money, you should liquidate your stocks and bonds to avoid making losses. 

  • Inflation and interest rates

The currency exchange rates are affected by the inflation rates in any country. Under normal circumstances, countries with lower inflation rates witness an increase in the value of their currencies and vice versa. Countries with higher inflation rates also have higher interest rates.

The fluctuation of interest rate also affects the value of your country’s money. When the interest rate is high, the value of the currency increases because the lenders have a higher borrowing cost. They, therefore, attract more foreign capital that ultimately leads to a higher exchange rate.

 There are numerous factors that affect forex trading. If you are a serious investor like I am, it is essential to know how each of these factors will affect your financial status. This will help you determine the optimal time for conducting international money transfers and shield you from making losses in your trade.

INDIAN RUPEE, US DOLLAR, USD/INR, CREDIT SPREADS, CORONAVIRUS – TALKING POINTS

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INDIAN RUPEE, US DOLLAR, USD/INR, CREDIT SPREADS, CORONAVIRUS – TALKING POINTS

  • Indian Rupee could face uphill battle as country struggles with virus
  • Local credit spreads have been widening and may continue that path
  • USD/INR consolidating as bearish chart pattern lacks follow-through

As India approaches the expiration of extended lockdown measures this Sunday, the Indian Rupee may still face a challenging fundamental landscape. In late April, I warned that gains in INR could be short-lived if the nation extends social distancing measures. Since then, the currency has been in much of a congestion range against the US Dollar.

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The nation is mulling resuming commercials flights by May 18 or perhaps sooner, but India seems to be struggling to make further inroads into lowering average case growth over a rolling weekly period. Meanwhile Markit India services and manufacturing PMI clocked in at a record-low 5.4 and 27.4 in April, down from 49.3 and 51.8 in March. Values below 50 indicate increasingly larger contractions in business activity.

Check out the newly-enhanced DailyFX economic calendar which now includes Indian data

According to the Centre for Monitoring the Indian Economy (CMIE), the unemployment rate is estimated to be at a record-high 27.1 percent. To help cope with the economic severity of the coronavirus outbreak, both fiscal and monetary authorities have jumped into action. Though there have been rising calls for more of the former. The government has thus far delivered on about INR1.7 trillion in stimulus, or about 0.8% of GDP.

In response, Prime Minister Narendra Modi outlined a plan to borrow INR12 trillion this fiscal year which is 54% more than what was budgeted. However, this plan could risk leaving out the corporate sector as state companies tend to account for most of local debt issuance. That may further inflate yields on domestic corporate bonds if they are perceived to be at a relatively higher likelihood to default on debt payments.

On the chart below, I have visualized the widening Indian credit spread since the beginning of this year. This is done by taking the difference between local 3-year AAA corporate bonds and the equivalent of sovereign notes. The spread is hovering around 260-basis points. Meanwhile global economic uncertainty is on the rise. As such, the Rupee may struggle in the coming weeks as the nation weighs easing social distancing rules.

How can central banks impact currencies?

WIDENING INDIAN CREDIT SPREADS

Indian Rupee May Struggle as USD/INR Wobbles, Credit Spreads Widen

INDIAN RUPEE TECHNICAL ANALYSIS

USD/INR continues to trade sideways since prices approached new highs in late March. A Rising Wedge bearish chart pattern and negative RSI divergence preceded the pair topping just under 77. Downside follow-through has since been lacking. Resuming losses entails taking out 74.94 which would expose former peaks from 2018. Otherwise, uptrend resumption may have USD/INR surpassing 77.00.

USD/INR DAILY CHART

Indian Rupee May Struggle as USD/INR Wobbles, Credit Spreads Widen

USD/INR Chart Created in TradingView

— Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter.

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Non-Manufacturing Index: Service With Smiles And Scowls

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Summary

The ISM Non-Manufacturing Index may have fallen to a 128-month low, but it’s not all bad news.

Sure enough, most business segments have done badly, and I would consider exiting their stocks.

However, a few service segments have gotten a boost from the COVID-19 disruption.

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Headlines, in a way, are what mislead you because bad news is a headline, and gradual improvement is not.

– Bill Gates

In April 2020, the ISM Non-Manufacturing Index crashed to 41.8%, a number that is 10.7% lower than the March 2020 number of 52.5%. What is more disturbing is that it represents a contraction that comes after 122 months of continuous growth. It also corresponds to a 2.3% decline in real GDP on an annualized basis.

I had noticed the Services PMI dipping in February 2020 and had warned about its implication on the economy in The Lead-Lag Report, and later followed it up with a tweet:

01ISM.jpg

(Image Source: Twitter)

So, does the current data spell curtains for the entire services sector in the near term?

No. There are a few sectors that are doing well among the many that are doing badly. Let’s start with the underperformers:

The Laggards

1. Accommodation and Food Services: This business segment was very badly impacted because of the lockdown, and it will continue to suffer because COVID-19 is changing the way we interact. The virus is likely to linger in our memories for a long time, because more than 40% of American adults have experienced someone in their household losing a job or taking a pay cut. Therefore, even after hotels and restaurants reopen for business, they will experience a substantial drop in revenues. This segment may continue to underperform until a vaccine is developed and the fear of virus transmission completely disappears.

2. Agriculture, Forest, Fishing and Hunting: This segment has gone into a tailspin. Milk is being dumped, surpluses are being burnt, and livestock are being destroyed as agricultural products’ prices crash. Employees are afraid to work in close proximity of their colleagues, and meat plants are either shut or are not operating despite President Trump’s executive order. It, too, will take some time to recover.

3. Arts, Entertainment and Culture: Most venues in this service segment are either shut or may find it difficult to breakeven after a limited reopening. Even after a full reopen, venues may find it difficult to pull in the usual crowds (benchmark: January 2020). This segment, like the accommodation and food services segment, will see sunshine only after a vaccine is developed.

4. Construction: Stay-at-home orders, cancellations, supply chain disruptions, worker shortages, health, and safety of workers – the sector is passing through a “force majeure” event. In a PWC survey of the COVID-19 impact, 41% of respondents feared the COVID-19 impact on their workforce, 40% feared a drop in demand, while 23% were concerned about supply disruptions. Events are yet to unfold, and this sector may see further pain ahead.

02ISM.jpg

(Image Source: PWC)

5. Healthcare and Social Assistance: Healthcare distributors tripped badly in planning the inventory, resulting in shortages and recalls of the critical PPE. Distributors who did not respond with alacrity to the pandemic may find it difficult to recover their business, especially because of the recalls. I would check which listed healthcare equipment makers and distributors faltered, and quickly get rid of their stocks.

6. The Usual Suspects: Retail suffered, which is obvious because people were at home and unemployment claims rose. However, it is too early to write off retail businesses that have been in existence for decades. Oil management and support services are suffering because the shakeout in the industry has just about started.

The Leaders

1. Select Wholesale Businesses: Though most of the wholesale businesses witnessed a substantial reduction in business, sales of janitorial supplies, sanitation, and paper picked up. That was natural given the boost that hygiene and cleanliness received because of the pandemic. These products are likely to remain in demand for a long time to come.

2. Finance: Though financial services were in demand for a variety of reasons – low interest rates, stimulus checks, refinancing, small business distress loans, etc. – banks have reasons to worry. For example, they have to make space for social distancing in their branches, and that may compromise on their real estate capacity. They also will face other challenges like:

  • Servicing ATMs.
  • They may have to increase call center staff to answer the increased volume of calls.
  • They may have to face risks if they have outsourced their processes to third-party contractors.
  • They may have to reach out to customers to manage brand perception (the disruption has angered many people).

So, the challenges to banks are many. That said, online banking and payment systems are two services that will do extremely well and may emerge as the leaders after the disruption goes away.

3. Insurance: According to Becker’s Healthcare, approximately 25-40 million Americans will lose their health insurance if the unemployment rate hits the projected 20%. But the Chicago Fed estimates the real unemployment rate to hit be as high as 34%.

More than 50% of Americans who lose their jobs will get covered by Medicaid in states that expanded the program under the Affordable Care Act (ACA). About 33% of newly unemployed Americans will qualify for health insurance in states that didn’t. Uncovered folks will have to fend for themselves.

To make matters worse, the economy is being opened up without fully understanding the virus or developing a vaccine. The economic hurt may intensify. These factors are likely to set off a flurry of activity in the insurance sector.

Summing Up

Here is the strategy I would play based on the analysis above:

(a) Exit hotel, leisure, bank, construction services, and restaurant stocks.

(b) Reduce exposure to dairy stocks.

(c) Consider investing in stocks in the hygiene, medical supplies services, online payments, and insurance sectors.

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InterGlobe Enterprises mulls Virgin Australia Bid By Investing.com

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© Reuters.

By Gina Lee

Investing.com – Rahul Bhatia, a majority shareholder of Indian budget carrier IndiGo, is considering joining the line of potential buyers for Virgin Australia.

Bhatia holds the IndiGo share through InterGlobe Enterprises Ltd, which is preparing a bid proposal.

At least 20 potential buyers have expressed interest in the distressed airline, as its administrator Deloitte seeks indicative bids by Friday, binding offers by June and to wrap the sale up by the end of June.

Virgin Australia owed AUD 6.84 billion ($4.45 billion) to more than 10,000 creditors at the time of its collapse. It was hit hard by COVID-19 lockdowns shutting down travel and reducing revenue.

The airline had requested an AUD 1.4 billion ($910.95 million) bailout from the Australian government at the end of March as it attempted to tackle its debt. Its much larger rival Qantas then demanded a loan of AUD 4.2 billion to “level the playing field.”

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Bitcoin Miners Sell BTC Months After Halving, On-Chain Data Suggests

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Bitcoin’s third halving is less than a day away and the cryptocurrency community remains divided on whether the price will rise or drop after the event. Interestingly, on-chain data from previous halvings suggests that after the halving Bitcoin price may not see an immediate drop.

Google Trends data shows that searches for the halving have already surpassed previous all-time highs, and the crypto community has been issuing a variety of price estimates for the post halving price.

Some analysts have pointed to the Efficient Market Hypothesis to support their view that the halving is already priced in, meaning it’s a foreseeable event investors can take into account early. Even a prominent Bitcoin whale who’s known as Joe007 recently argued that the price of Bitcoin would crash after the halving.

What does on-chain data show pre-halving

Blockchain data shared by on-chain data analysis firm CryptoQuant shows that miners are not keen on selling their newly minted BTC ahead of the halving. Using the Miners’ Position Index (MPI), CryptoQuant found that over the last three months, miners have been avoiding selling.

Miner Position Index. Source: CryptoQuant

Miner Position Index. Source: CryptoQuant

An MPI reading above 2 suggests miners are selling their BTC after mining, while a negative value shows they’re avoiding selling as much as possible in favor of accumulation.

As shown on the chart above, the MPI was slightly above 0 in December 2019 and it began to drop in January. By February the reading had hit -0.5.

Miners do not sell right away

Bitcoin miners have historically been a driving force behind Bitcoin’s price as they are the suppliers of new coins in the market. They are also one of the primary groups that create constant sell pressure for BTC as they liquidate newly minted coins to cover their electricity and operating expenses.

Thus, miner sentiment is important for the market and something investors keep a close eye on. Back in 2017, when the price of Bitcoin hit a new all-time high near $20,000, the MPI hit a high of 3.9, showing miners sold coins they seemingly deemed overpriced.

In the subsequent year-long bear market, the MPI dropped below -1, showing miners avoided selling as much as possible despite the low prices.

Data shows that in the first and second halvings, miners did not sell their funds right away. Ahead of the halvings, the MPI was below 0 and as the price increased so did the MPI. When the MPI reading surpassed 2 just a few months after the halving, the price crashed.

Furthermore, when the first halving occurred in November 2012, miners rode the bull run until April 2013, then they finally started selling their coins.

Mason Yang, CSO at CryptoQuant told Cointelegraph:

After the two previous halvings, the Bitcoin price did not skyrocket immediately after the halving. The Bitcoin price had risen over several months. If traders want to avoid trading risks, the most important thing is monitoring whether whales and miners are cashing out rather than expecting short-term price changes.

MPI shifts during previous Bitcoin halvings. Source: CryptoQuant

MPI shifts during previous Bitcoin halvings. Source: CryptoQuant

Bitcoin miners’ role is expected to decrease in in 2020

The cryptocurrency space has evolved significantly since the last halving in 2016. Data from cryptocurrency data provider CryptoCompare shows that throughout 2020 daily trading volumes have consistently been at least 10 times larger than those in 2016.

In 2016 Bitcoin volumes on spot exchanges rarely exceeded $1 billion a day, while they now consistently surpass $10 billion a day. Readers will also note that April 30 saw record-breaking volumes leading to the Bitcoin halving.

Total Spot Volume. Source: CryptoCompare

Total Spot Volume. Source: CryptoCompare

Crypto derivatives markets have also grown significantly, with Binance, Huobi, OKEx, and BitMEX trading well over $50 billion each throughout April. This suggests that Bitcoin miners are now smaller players in the space, although they are still responsible for creating constant sell pressure in the Bitcoin price.

Recently Blockware Solutions CEO Matt D’souza told Cointelegraph:

I think we may get a bit of the buy the rumor, sell the news. In 2016 we had a significant 80% run-up before halving and that got sold into halving and the day of halving we sold off further. We bottomed 3 weeks beyond halving and began an amazing bull run. This time we haven’t had the run-up but we’re getting some buy-side demand presently. I think it gets sold right into or after halving, but I also think that the selloff will be smaller and shallower as we didn’t have the run-up.

Miner selling pressure, as such, may not be expected to have such a significant impact on the price of Bitcoin right after the halving this year.

Obviously, past performance is no guarantee of future results but it is worth considering given that miners are minting 1,800 BTC (nearly $18 million) per day.

Exchange inflows provide valuable insight

Cryptocurrency exchange inflows may be a better indicator of what is going to happen at the time of the halving. These precede significant price rises and sharp drops, as miners and whales move their coins to trading platforms before shifts in price occur.

As shown by the exchange inflow chart below, there was a surge before and during the March 13 market crash to $3,750.

Total BTC inflow to all exchange wallets. Source: CryptoQuant

Total BTC inflow to all exchange wallets. Source: CryptoQuant

After the Black Thursday crash, inflows have remained relatively low as whales and miners were not moving coins from their wallets to trading platforms. This suggests that they may be looking for the price to perform as it did during the last two halving events.

Whatever the short-term price action is after the halving, many are bullish about the event, especially in the long-run. According to D’souza:

Overall, it seems we’re transitioning into a bull market. The fundamentals have never been better for Bitcoin and funds, retail, hodlers are deploying capital towards Bitcoin which counterbalances sell pressure.

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Below are links to information you may find helpful. All links collected by our team. We will endeavour to ensure that this directory is up to date and useful.

Top websites about Trading:

FXstreet – source for reliable news and real time Forex analysis. Real-time exchange rates, charts and an economic calendar.

DailyFX – portal for forex trading news and analysis. Every tool you need to trade in the foreign exchange market.

ForexCrunch – site about the foreign exchange market: forex news, basics of currency trading,  forex analysis, technical analysis.

Actionforex – Features forex news, analysis, and educational materials.

FxEmpire – Source for everything Finance – Stocks, Indices, Forex & Commodities. News, Technical & Fundamental Analysis.

Live Charts:

TradingView – offers the best charts and a community of investors who are passionate about sharing trading ideas.

FXStreet – Live charts from fxstreet.

ProfitF – Live Forex chart on our website.

Forums:

ForexFactory — Popular Forex forum

Forex TSD — a Forex forum specializing in robots, indicators and other tools.

BabyPips – Learn How to Trade Forex. Beginner’s Guide to Forex Trading

Trade2win – Community website and portal for active traders seeking to profit from stocks, futures, options and forex.

Services for analyzing FX accounts:

Myfxbook — analyze your trading account activity and share it. Allow anlysing detailed stats of other traders.

FXblue – web-based service for analyzing trades from MT4, MT5, cTrader, Oanda fxTrade, xOpenHub, Vertex FX, FXCM TS2.

Financial News:

Bloomberg – Bloomberg Markets delivers financial news, data, analysis, and video to the world.

FInance.Yahoo – The latest in financial news and the latest breaking stories in business, personal finance newsю

Money.cnn – business, markets, technology, media, luxury, personal finance and …

Reuters – Business news & Financial news.

Theguardian – Business and finance news.

BBC markets – Breaking personal finance, company, financial and economic news.

Software Developers:

ninZa – Programms for NinjaTrader and Kinetick. Company  provides traders best NinjaTrader indicators (many FREE) for forex, futures, stocks trading. Larry Pi –  founder of ninZa with  5+ years of trading experience. Since 08-May-2014, ninZa.co has become an official partner of NinjaTrader and Kinetick

Rebate services:

PipSafe –  If you open Forex account via pipsafe affiliate link they get back some part of this commission – Up to 85% to clients

Popular e-payment methods:

PayPal  |  Skrill  | Neteller  |  WebMoney | Payza | Neteller  | CashU

Platforms for FX Trading:

MetaTrader  |  TradeStation  |  NinjaTrader  |  MultiCharts   |  eSignal   |  JForex  |  CTrader

FUNDAMENTAL EURO FORECAST: NEUTRAL

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FUNDAMENTAL EURO FORECAST: NEUTRAL

  • After so much bad news from the Eurozone, EUR/USD is due at least a pause for breath.
  • Of course there’s no guarantee that it won’t be knocked back further by yet more unwelcome developments, but with pessimism already so pervasive a rally can’t be ruled out.

EURO PRICE OUTLOOK: DUE FOR A BREAK

The Euro was hit hard last week by a German Constitutional Court ruling that gave the European Central Bank three months to justify purchases under its bond-buying program or lose the Bundesbank’s participation in one of its principal schemes to boost the Eurozone economy.

To make matters worse still, the European Commission predicted that the Eurozone economy will contract by a record 7.7% this year because of the Covid-19 pandemicand that both public debt and budget deficits will surge. This prompted Paolo Gentiloni, the European Commissioner for Economic and Financial Affairs, to declare that “Europe is experiencing an economic shock without precedent since the Great Depression.”

Underlining the point about public debt, Germany, France and Spain all unveiled government bond sales, and the reaction in EUR/USD took the pair back below the 1.08 level for the first time since April 24.

EUR/USD PRICE CHART, DAILY TIMEFRAME (JANUARY 29 – MAY 7, 2020)

EURUSD Price Chart

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For now, the ECB seems to be the only player in the market trying to ease the Eurozone’s economic pain caused by the spread of the coronavirus – with Eurozone governments still unable to agree on a joint fiscal response. However, the question that needs to be asked in the week ahead is whether market participants have become too negative on EUR/USD.

The latest Commitments of Traders report from the US Commodity Futures Trading Commission showed them less net-long the pair than previously, with short positions creeping higher – arguably a positive signal. As for the technical picture, as the chart above shows, the price is now close to trendline support. If it breaks to the downside, the 1.0636 March low would come into focus but if it holds it could be a base for a rally.

WEEK AHEAD: GDP DATA

Turning to the coming week’s economic statistics, Friday’s first-quarter economic

growth numbers for Germany and the Eurozone as a whole could attract attention but there is unlikely to be much of a response given how much has changed since then.MAY 121:30 PM +03:00

RECOMMENDED BY MARTIN ESSEX, MSTATrading SentimentRegister for webinar

Market movements can be unpredictable but the stop loss can provide protection against losses. To learn more, check out this article in the newly revamped DailyFX education section.

— Written by Martin Essex, Analyst and Editor

Feel free to contact me via the comments section below

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Dow Jones, DAX 30 & ASX 200 Forecasts for the Week Ahead

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Dow Jones, DAX 30 & ASX 200 Price Outlooks:

DOW JONES FORECAST OUTLOOK: BEARISH

The Dow Jones enjoyed a moderately strong performance last week as investors grappled with the possibility of a negative Federal Funds rate. The prospective decline in rates was laid against a backdrop of soaring unemployment as Friday’s non-farm payrolls report revealed the sharpest employment decrease on record. Still, the potential for lower rates alongside a gradual reopening of the US economy proved sufficient catalysts for an opportunistic Dow Jones.

Find out what type of trading style suits you best.

It could be argued, however, that the Dow’s ascent is slowing as it has failed to establish a fresh high despite slowing coronavirus cases, an easing in quarantine restrictions and an accommodative Federal Reserve. With that in mind, further strength may require another string of positive developments or bullish themes – but with a relatively calm economic calendar, the Dow may be left grasping for influence. With price showing signs of topping out in the shorter-term, the prospect of a brief trip lower is not out of the question.

DOW JONES PRICE CHART: 4 – HOUR TIME FRAME (FEBRUARY – MAY)

Dow Jones Four-Hour Price Chart

DAX 30 FORECAST

OUTLOOK: NEUTRAL

The DAX 30 also has a relatively sparse economic calendar apart from a flash GDP reading this Friday. The data for both Germany and the Euro Area will provide crucial insight for investors looking to ascertain the depth of economic despair in the region.MAY 136:00 PM +03:00RECOMMENDED BY PETER HANKSWeekly Stock Market OutlookRegister for webinar

Since Germany has already challenged the ECB’s stimulus program – arguing German taxpayers will end up on the hook – a growth reading beneath expectations could spark calls for further easing and more resistance from German lawmakers. While the shorter-term implications may be minor, each skirmish between the ECB and Germany will work to undermine the European Union’s fragile existence.

ASX 200 FORECAST

OUTLOOK: NEUTRAL

Similarly, upcoming Australian employment data will shed light on the ASX 200. As it stands, unemployment in Australia has been relatively contained compared to the United States, which could see a surprise reading seriously undermine sentiment. Until the data is delivered, the ASX will likely track other equity markets and broader risk trends. In the meantime, follow @PeterHanksFX on Twitter for updates and analysis.

ASX 200 PRICE CHART: 4 – HOUR TIME FRAME (FEBRUARY – MAY)

ASX 200 Four-Hour Price Chart

–Written by Peter Hanks, Analyst for DailyFX.com

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Israeli ministry to decide on El Al support loans By Reuters

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© Reuters. El Al Israel Airlines planes are seen on the tarmac at Ben Gurion International airport in Lod, near Tel Aviv, Israel
TEL AVIV (Reuters) – Israeli Finance Minister Moshe Kahlon is set to meet officials from El Al Israel Airlines (TA:) later on Sunday to decide on a recovery plan for the cash-strapped airline that has been grounded due to the coronavirus outbreak.El Al, Israel’s flag carrier, is seeking state-backed loans of $400 million to help it through the crisis as foreigners are barred from entering the country and incoming Israelis must enter quarantine.El Al has suspended passenger flights until at least the end of May while about 6,000 of its workers are on unpaid leave until June 30.El Al and the ministry have been at odds over demands El Al must cut jobs as part of a recovery plan, while shareholders are also resisting injecting new funds, a ministry spokesman said.Workers opposed to the layoffs plan to hold a protest at the time of the meeting outside the ministry.El Al has presented a plan that includes an unknown number of layoffs, according to the ministry. Any layoffs would require approval by the airline’s union which is yet to happen, an El Al spokesman said.The spokesman for Kahlon said another key issue is a demand by the ministry that El Al’s owners inject some cash into the firm.“That’s the core issue,” he said. “The problem is the owners don’t want to pay.”He rejected Israeli media reports that Kahlon was seriously considering dissolving El Al, which has twice delayed publishing fourth-quarter financial results.The airline said last month it was in advanced talks with an Israeli bank to receive a loan that will be partly backed by government guarantees.Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.