Another Big Week for China shares?

Chart of the Day: GBP/CHF (4hr Candlesticks)
Source: GKFX / MT4 (July 12, 2020)

GBP/CHF has broken the neckline of an inverse head and shoulders pattern, in which both shoulders formed at 1.1725, matching the May 15 low.

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•    CHART: GBP/CHF Inverted H&S
 

MARKETS

It was a rough week for the US dollar after haven flows dried up on optimism about new coronavirus treatments and the progress toward creating a vaccine. A 1% weekly gain in the Chinese yuan (USD/CNH) added to the pressure on the dollar as Chinese stock markets rallied. The British pound completed a second weekly gain after the UK government announced new fiscal stimulus (see GBP/CHF below).

It was a huge week for Chinese shares, which carried on a 2-week rally through Thursday before finally having a down-day on Friday. Wall Street too finished the week on a high with the Nasdaq making a fresh record high led by gains in Tesla. Other global indices in Europe and Japan edged closer to peaks made in early June.

Gold ended the week off the 9-year high below the $1800 per oz achieved on Wednesday but the uptrend remains intact. Oil had its highest weekly close since March.