Here’s a rundown of what’s happening in commodity, forex, and cryptocurrency markets during the COVID-19 outbreak. As of today, there have been 17,390 cases with 362 deaths in 27 countries. Note that there is no guarantee that market trends will continue in the same direction. Trade with caution.
First stop, oil. The Coronavirus outbreak will likely dampen international travels causing lower demand for Crude Oil making prices in the market go low. Here’s what the 4-hour chart looks like starting the end of December 2019 to the first week of February 2020.
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Copper slid as well starting January 16, 2020. Copper is widely used in construction, electronics, transportation equipment, among others and has been regarded as a barometer for global economic health.
As uncertainties and fear grow, investors prefer to put their money on safe-haven assets such as gold. Gold prices are trending up.
In forex, the Japanese Yen (JPY) has always been considered a safe-haven asset. JPY is “stronger” as shown in the USD/JPY price chart which is going down. This means you can buy more USD with less JPY.
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For non-believers, even Bitcoin is rallying. Bitcoin and other cryptocurrencies are considered by some investors to be the safe-haven asset of the digital age.
How to Trade
The safest way to go now is to go heavy on cash, wait for stability before entering. If you are a seasoned trader then volatility presents opportunities for you. If you do not have time to watch the markets, stay away from trading in the next few days and just park your cash in safer alternatives.
Check out COVID-19 timeline here. Stay safe everyone.
