Wondering about Covid impact during winter months and did a little reading while market chops around. I'm no where near qualified but facts/evidence suggests the pandemic could drag on much further if adequate precautions aren't taken...
1/
COVID vs SEASONAL FLU
Flu's are viruses and studies imply Covid like the flu can survive better and thrive in colder drier climates. But while people have built up immunity to seasonal flu strains, covid is new to which no one has immunity.
2/
COLDER AND DRIER WEATHER
On existing evidence, warm wet climates seem to reduce Covid spread. In winter, viruses survive longer indoors as air is sealed and less humid than it is outside thus able to land/survive on surfaces longer as well as linger in the air longer.
3/
WEAKER IMMUNITY IN WINTER
Less sunlight exposure lowers Vit-D & melatonin levels, both requiring sunlight for their generation. Immune systems and ability to fight viruses are compromised. Covid symptoms could surface and deteriorate quicker thereby increasing risk of death.
4/
FLU SEASON PEAKS IN FEB
In US, it can begin as early as OCT but usually does not get into full swing until DEC. The season generally reaches its peak in FEB and ends in MAR according to Harvard's 'science in the news' blog.
5/
If we absorb the above and think about the mechanics of how people move during the winter holiday season, social spaces contracts and people effectively move from one huddle to another huddle and in many cases, over greater distances during the holiday season.
6/
Risks of Covid spreading therefore remains high, if not higher during the holiday season and, this would imply the pandemic could drag on well into 2021 if social interactions and travel is not restricted to a great extent and on a global scale.
/End
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Hope you had a good week/end.
Here's my updated look at $USD charts and themes:
📉📈USD index $DXY $DJFXCM shoulderline to hold?
📉📈$USDCNH driving USD weakness but did we bottom?
📈📉$EURUSD strong recent demand out of steam?
$DXY looking oversold trading outside the 1sd band. $DJFXCM equal-weighted index showing similar except it has broken out of channel and completed measured move up, and consolidating back down. Both holding above key shoulderline support area.
$USDCNH completes measured move down from neckline at 6.91 to last weeks low at 6.627. A (weak) weekly reversal candle with momentum divergence on lows all makes a strong technical case for a bounce.
PBOC are concerned about sharp $CNY appreciation which can hurt exports and ...
Had some strong price action on Friday which can confuse the weekly signals, so something to keep in mind with the weekly view. With that, I'm going through all major crosses, Oil gold and some equity indices.
$EURUSD
*Weeklys: bearish inside week following huge candle prior week, month and a half rejection of 1.09. Attempted to bottom and sustain a rally unconvincingly.
*Dailys: confirms weekly narrative with each rejection of key technical levels coming down e.g. 20dma and bband
$GBPUSD
*Weeklys: breakdown exposing 1.2 handle
*Dailys: Friday biggest daily bear candle, price action traders usually skeptical/suspicious of this but given news flow I think this technical picture is well supported with bitter brexit looking likely regardless.