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Forex News Timeline

Friday, April 23, 2021

The buying interest around the European currency gathers extra pace and lifts EUR/USD to new daily highs around 1.2060 at the end of the week. EUR/USD

EUR/USD resumes the upside well above 1.2000.EMU, German Manufacturing PMI surprised to the upside.Chairwoman Lagarde due to speak later in the session.The buying interest around the European currency gathers extra pace and lifts EUR/USD to new daily highs around 1.2060 at the end of the week. EUR/USD bid after positive PMIs, looks to Lagarde EUR/USD fades Thursday’s negative price action and resumes the march north to the 1.2060/70 band following the resumption of the downside pressure around the greenback and auspicious results from euro fundamentals. Indeed, advanced Manufacturing and Services PMIs in the core Euroland (France, Germany, and the euro bloc) came in above expectations for the month of April, all indicative that the morale in those sectors remain firm. Adding to the pair’s upside, the greenback looks offered against the backdrop of increasing outflows into the risk complex and absence of traction in yields of the US 10-year reference, which keep navigating near recent lows around 1.54%. Also adding to the upbeat note in the single currency, the ECB published its quarterly Survey of Professional Forecasters (SPF), where inflation tracked by the broader HICP is seen higher this year (1.6% vs. 0.9%) and unchanged in 2022 and 2023 (1.3% and 1.5%, respectively). Regarding the GDP, the SPF now sees the economy of the region expanding a tad lower in 2021 (4.2% vs. 4.4% from the previous forecast), 4.1% next year (from 3.7%) and 1.5% in 2022 (unchanged). Later in the session, Chief Lagarde will participate in the panel “A Global Tipping Point: The Power of Global Capital Markets in the Fight Against Climate Change”. Data wise across the pond, Markit will also publish its flash gauges seconded by March’s New Home Sales. What to look for around EUR EUR/USD moved to fresh peaks around 1.2080 before losing some traction amidst the resurgence of dollar demand and volatility on fresh coronavirus woes. The continuation of the rally has been so far supported by the renewed offered bias in the dollar along with the investors’ shift to the growth prospect in Europe now that the vaccine campaign appears to have gained some serious pace. In addition, solid results from key fundamentals and the improvement in the sentiment in the euro area as of late also appear to bolster the momentum surrounding the single currency.Key events in the euro area this week: ECB Lagarde speech (Friday).Eminent issues on the back boiler: Asymmetric economic recovery in the region. Sustainability of the pick-up in inflation figures. Progress of the vaccine rollout. Probable political effervescence around the EU Recovery Fund. EUR/USD levels to watch At the moment, the index is gaining 0.35% at 1.2056 and faces the next hurdle at 1.2079 (monthly high Apr.20) followed by 1.2243 (monthly high Feb.25) and finally 1.2349 (2021 high Jan.6). On the other hand, a breach of 1.1953 (50-day SMA) would target 1.1919 (200-day SMA) en route to 1.1762 (78.6% Fibo of the November-January rally).

GBP/USD below 1.3810/09 can end thoughts of a “double bottom”, clearing the way for a move back towards the lower end of the broader range at 1.3717,

GBP/USD below 1.3810/09 can end thoughts of a “double bottom”, clearing the way for a move back towards the lower end of the broader range at 1.3717, the Credit Suisse analyst team reports. Cable to end thoughts of a “double bottom” base below 1.3810/09 “GBP/USD is not only back well below the ‘neckline’ to the ‘double bottom’ base at 1.3919 but also its rising 55-day average, throwing a serious question mark over this base.  “Below 1.3810/09 would see the base fully negated to reinforce the broader sideways range again, albeit with an immediate downside bias. Support would then be seen next at the recent ‘reversal day’ low at 1.3717, below which can clear the way for a retest of the lower end of the sideways range at 1.3670/69. Whilst we would look for a fresh hold here, a break though would now instead complete a bearish continuation pattern.”  “Resistance is seen at 1.3886 initially, with the immediate risk now seen lower whilst below 1.3919. Above 1.3950 though is needed to clear the way for a retest on the top of the range at 1.4001/17.”  

EUR/GBP maintains a choppy tone and above 0.8703 can see a retest of key price and “neckline” resistance at 0.8721/32. Beyond here would now see a “he

EUR/GBP maintains a choppy tone and above 0.8703 can see a retest of key price and “neckline” resistance at 0.8721/32. Beyond here would now see a “head & shoulders” base established to mark a more important turn higher, according to economists at Credit Suisse. Choppy price action rekindles thoughts of a potential base “EUR/GBP maintains a near-term choppy tone and the failure to follow-through to the downside following its recent bearish ‘reversal day’ and subsequent recovery rekindles thoughts of a potential basing process. Above 0.8703 can add weight to this view for a retest of key price and ‘neckline’ resistance at 0.8721/32.”  Beyond 0.8721/32 would now see a ‘head & shoulders’ base established to mark a more important turn higher with resistance then seen initially at the 38.2% retracement of the fall from December at 0.8761 ahead of 0.8793/99 and then more importantly at the ‘neckline’ to the medium-term top at 0.8851/61.”  “Support moves to 0.8647/44 initially, with a break below 0.8634 needed to ease the immediate upside bias for a fall back to 0.8613, then the 0.8588/78 recent low.”  

The GBP/USD pair struggled to capitalize on its intraday positive move and retreated few pips from daily tops. The pair was last seen trading around t

GBP/USD regained positive traction on Friday and stalled its recent slide from multi-week tops.The prevalent bearish sentiment surrounding the USD was seen as a key factor lending support.The British pound got an additional boost following the release of upbeat UK PMI prints for April.The GBP/USD pair struggled to capitalize on its intraday positive move and retreated few pips from daily tops. The pair was last seen trading around the 1.3870-75 region, still up over 0.30% for the day. The pair managed to regain some positive traction on the last trading day of the week and for now, seems to have stalled this week's retracement slide from the key 1.4000 psychological mark. This marked the first day of a positive move in the previous four and was exclusively sponsored by the prevalent bearish sentiment surrounding the US dollar. The market now seems convinced with the view that any spike in inflation is likely to be temporary and have been scaling back their expectations for an earlier than anticipated Fed lift-off. This was evident from the fact that the USD bulls largely shrugged off Thursday's upbeat US Jobless Claims data and a modest uptick in the US Treasury bond yields. The British pound got an additional boost following the release of better-than-expected UK flash PMI prints for April. The preliminary estimate indicated that business activity in both manufacturing and services sector expanded more than anticipated in the current month. This, in turn, allowed the GBP/USD pair to snap three consecutive days of the losing streak. Despite the supporting factors, the uptick lacked any strong bullish conviction and stalled just ahead of the 1.3900 round-figure mark. Some cross-driven effect stemming from a fresh leg up in the EUR/GBP seemed to be the only factor capping gains for the GBP/USD pair. This makes it prudent to wait for some follow-through buying before positioning for any further gains. Market participants now look forward to the US economic docket, highlighting the release of flash Manufacturing and Services PMI prints later during the early North American session. This, along with the US bond yields, might influence the USD price dynamics and produce some short-term trading opportunities around the GBP/USD pair. Technical levels to watch  

The ECB Survey of Professional Forecasters (SPF) for the second quarter of 2021 showed a downward revision to the real GDP expectations for this year

The ECB Survey of Professional Forecasters (SPF) for the second quarter of 2021 showed a downward revision to the real GDP expectations for this year and upward in 2022, implying a further delay in recovery. Additional findings “HICP inflation expectations stood at 1.6%, 1.3% and 1.5% for 2021, 2022 and 2023, respectively. Compared with the previous round for the first quarter of 2021, these were revised upward by 0.7 percentage points for 2021 but unchanged for 2022 and 2023.”  “The expectations imply a return of GDP during 2022 to above its 2019 level. However, this would still be 2.6% lower than the level for 2022 implied in the survey round for the first quarter of 2020, i.e. before Europe was affected by the coronavirus (COVID-19). Average longer-term expectations for real GDP growth were unchanged at 1.4%.” “The profile of unemployment has been revised down for 2021-23 but longer-term expectations were unchanged at 7.4% for 2025, implying an overall slightly less pronounced downward trajectory.”

Hong Kong SAR Consumer Price Index up to 0.5% in March from previous 0.3%

The UK manufacturing and services sector activities improve further in April, the preliminary report from IHS Markit showed this Friday. more to come

UK Manufacturing PMI beats estimates with 60.7 in Apr.Services PMI in the UK jumps to 60.1 in Apr, a beat. GBP/USD keeps its range below 1.3900 despite the upbeat UK PMIs.The UK manufacturing and services sector activities improve further in April, the preliminary report from IHS Markit showed this Friday.    more to come ...

United Kingdom Markit Services PMI came in at 60.1, above forecasts (59) in April

United Kingdom Markit Manufacturing PMI above forecasts (59) in April: Actual (60.7)

Gold surrendered its modest intraday gains and refreshed daily lows, around the $1,781 region during the early European session, albeit lacked follow-

Gold struggled to capitalize on its intraday positive move to the $1,790 region.A modest bounce in the equity markets, US bond yields exerted some pressure.The prevalent USD selling bias should help limit the downside for the commodity.Gold surrendered its modest intraday gains and refreshed daily lows, around the $1,781 region during the early European session, albeit lacked follow-through selling. A combination of factors failed to assist the precious metal to capitalize on its early uptick, instead prompted some fresh selling around the $1,790 region. Bearish traders might now be looking to extend the previous day's retracement slide from the vicinity of the $1,800 round-figure mark, or near two-month tops. Investors seemed to have digested the overnight report that the Biden administration is seeking an increase in the capital gains tax for wealthy individuals to near 40%. This was evident from a goodish rebound in the US equity futures. This, in turn, was seen as a key factor that undermined the safe-haven XAU/USD. Apart from this, a modest uptick in the US Treasury bond yields further acted as a headwind for the non-yielding yellow metal. The negative factors, to a larger extent, were offset by the prevalent bearish sentiment surrounding the US dollar, which languished near multi-week lows amid reduced bets for an earlier Fed lift-off. Investors now seem convinced with the view that any spike in inflation is likely to be transitory and that the Fed will keep interest rates near zero levels for a longer period. This was seen as a key factor that extended some support to the dollar-denominated commodity and should help limit deeper losses, at least for now. Market participants now look forward to the release of the flash Manufacturing and Services PMI prints. The data will offer fresh insight into how the economy is performing and influence the USD. This, along with the US bond yields and the broader market risk sentiment, might provide some impetus to the XAU/USD. Technical levels to watch  

India M3 Money Supply registered at 11.3%, below expectations (12.2%) in April 9

ECB and other major central banks to discontinue 84-day USD liquidity operations from July developing story ...

ECB and other major central banks to discontinue 84-day USD liquidity operations from July  developing story ...

The Eurozone manufacturing sector activity improved much beyond expectations in the reported month, the latest manufacturing activity survey from IHS/

Eurozone Manufacturing PMI arrives at 63.3 in Apr vs. 62.0 expected.Bloc’s Services PMI expands to 50.3 in Apr vs. 49.1 expected.The Eurozone manufacturing sector activity improved much beyond expectations in the reported month, the latest manufacturing activity survey from IHS/Markit research showed on Friday. The Eurozone Manufacturing purchasing managers index (PMI) improved from 62.5 in March to 63.3 in April and beat 62.0 expectations by a big margin.    more to come ...

FX Strategists at UOB Group noted that the selling pressure in USD/CNH remains well in place for the time being. Key Quotes 24-hour view: “Yesterday,

FX Strategists at UOB Group noted that the selling pressure in USD/CNH remains well in place for the time being. Key Quotes 24-hour view: “Yesterday, we held the view that USD ‘could dip below 6.4850 but the next major support at 6.4700 is unlikely to come under threat’. We highlighted that ‘there is another minor support at 6.4800’. USD subsequently dropped to 6.4802 before rebounding. Downward pressure appears to have eased and for today, USD is likely to trade sideways between 6.4830 and 6.5030.” Next 1-3 weeks: “Two days ago (21 Apr, spot at 6.5000), we indicated that the ‘downside risk in USD remains intact and the next support below 6.4850 is at 6.4700’. USD broke 6.4850 yesterday and dropped to 6.4802. Despite the breach of 6.4850, downward momentum has not improved by much. That said, the risk is still for a lower USD but any weakness is expected to encounter solid support at 6.4700. O the upside, a breach of 6.5200 (no change in ‘strong resistance’ level) would indicate that the weakness in USD that started more than a week ago (see annotations in the chart below) has come to an end.”

European Monetary Union Markit PMI Composite registered at 53.7 above expectations (52.8) in April

European Monetary Union Markit Services PMI above forecasts (49.1) in April: Actual (50.3)

European Monetary Union Markit Manufacturing PMI above expectations (62) in April: Actual (63.3)

The greenback, in terms of the US Dollar Index (DXY), reverses Thursday’s pullback and revisits the vicinity of the 91.00 neighbourhood at the end of

DXY looks weaker and challenges the 91.00 mark.US 10-year yields bounce off lows near the 1.54% level.Flash PMIs, housing data next of note in the US calendar.The greenback, in terms of the US Dollar Index (DXY), reverses Thursday’s pullback and revisits the vicinity of the 91.00 neighbourhood at the end of the week. US Dollar Index looks to risk trends, data Thursday’s positive price action around the buck has been sustained by the recent pick-up in coronavirus cases – particularly in India and Japan – and President Biden’s plans to increase the capital gains tax. However, the index resumes the downside and puts the 91.00 mark once again to the test on Friday, always on the back of the better mood in the risk complex and the lack of serious traction in US yields. Indeed, the dollar loses momentum and extends the choppy activity seen in past sessions while navigating the lower end of the recent range around the key support at the 91.00 zone. Later in the US calendar, Markit will publish its preliminary PMIs for the month of April seconded by New Home Sales for the month of March. What to look for around USD The dollar struggles to keep business around the 91.00 area amidst the ongoing consolidative mood, always looking to the renewed soft note in US yields and the loss of enthusiasm on the US reflation/vaccine trade. Also weighing on the buck emerges the mega-accommodative stance from the Fed (until “substantial further progress” in inflation and employment is made) and hopes of a strong global economic recovery, all morphing into a source of support for the risk complex and a most likely driver of probable weakness in the dollar in the second half of the year.Key events in the US this week: Flash Markit Manufacturing PMI (Friday).Eminent issues on the back boiler: Biden’s new infrastructure bill worth around $3 trillion. US-China trade conflict under the Biden’s administration. Tapering speculation vs. economic recovery. US real interest rates vs. Europe. Could US fiscal stimulus lead to overheating? US Dollar Index relevant levels At the moment, the index is losing 0.27% at 91.03 and faces the next support at 90.85 (weekly low Apr.20) ahead of 89.68 (monthly low Feb.25) and then 89.20 (2021 low Jan.6). On the other hand, a break above 91.65 (50-day SMA) would open the door to 92.08 (200-day SMA) and finally 93.43 (2021 high Mar.31).

The USD/CAD pair maintained its offered tone through the early European session and was last seen hovering near daily lows, around the 1.2475-70 regio

A combination of factors prompted some fresh selling around USD/CAD on Friday.The USD remained depressed near multi-week lows amid reduced Fed rate hike bets.An uptick in crude oil prices underpinned the loonie and contributed to the selling bias.The USD/CAD pair maintained its offered tone through the early European session and was last seen hovering near daily lows, around the 1.2475-70 region. Following the previous day's directionless price moves, the pair witnessed some fresh selling pressure on Friday and has now moved well within the striking distance of the post-BoC swing lows. The downfall was sponsored by the prevalent bearish sentiment surrounding the US dollar and positive crude oil prices, which tend to underpin the commodity-linked loonie. Investors seem convinced with the view that any spike in inflation is likely to be temporary and have been scaling back their expectations for an earlier than anticipated Fed lift-off. This, to a larger extent, offset an uptick in the US Treasury bond yields and kept the USD bulls on the defensive near multi-week lows through the first half of the trading action. On the other hand, a more hawkish forward guidance by the BoC extended some support to the Canadian dollar. The Canadian central bank, at its policy meeting held on Wednesday, brought forward its guidance for the first interest rate hike to the second half of 2022. This, along with a follow-through recovery in oil prices, acted as a headwind for the USD/CAD pair. In fact, WTI crude oil built on the previous day's recovery from over one-week lows and was supported by expectations for higher fuel demand in the US and Europe amid easing lockdown restrictions. That said, renewed fears about another dangerous wave of coronavirus infections in Japan and India – the world's third-biggest oil importer – capped gains for the commodity. From a technical perspective, the USD/CAD pair, so far, has been struggling to register any meaningful recovery or find acceptance above the 1.2500 psychological mark. This, in turn, suggests that the bearish pressure might still be far from being over. A subsequent fall below the 1.2460 region (weekly lows) will add credence to the negative outlook and set the stage for further weakness. Market participants now look forward to the US economic docket, highlighting the release of the flash Manufacturing and Services PMI prints. The data will offer fresh insight into how the economy is performing and influence the USD. This, along with oil price dynamics, should allow traders to grab some short-term opportunities around the USD/CAD pair. Technical levels to watch  

Since 12 March, the Nasdaq has outperformed US small caps by 8.9% and this, in the view of economists at DBS Bank, reflects rising moderation in enthu

Since 12 March, the Nasdaq has outperformed US small caps by 8.9% and this, in the view of economists at DBS Bank, reflects rising moderation in enthusiasm for vaccine-related “reflation trade”; and the rationale are the resurgence of COVID-19 cases, a peakish macro momentum and retracing US Treasury yields. Retracing bond yields is positive for gold and it is time to take a relook “Resurgence of COVID-19 cases and slow vaccine rollout: COVID-19 cases are rising while vaccination among developing countries remain slow. A delay in the return to normalcy for businesses will weigh on global growth.” “Peakish macro momentum: At 64.7, the US ISM Manufacturing Index is looking toppish and a retracement in the index has historically coincided with a moderation in the rally on S&P 500 Index.” “Retracing UST yields: US Treasury (UST) bond yields are retracing despite strong macro data. This suggests rising caution on this year’s economic growth assumptions.”  “The relative underperformance of Technology is turning the corner and we expect the positive momentum to continue. The virtual and borderless nature of the technology space requires less face-to-face human interactions. A deterioration of the COVID-19 situation will therefore have less negative impact on Technology and we expect the sector to regain cyclical leadership.” “The retracement in bond yields is positive for the outlook of gold and it is time to have a relook of the precious metal.”  

EUR/USD has been bouncing off 1.20 as markets digest the news of US tax hikes. In the view of FXStreet’s Analyst Yohay Elam, the euro is well-position

EUR/USD has been bouncing off 1.20 as markets digest the news of US tax hikes. In the view of FXStreet’s Analyst Yohay Elam, the euro is well-positioned as the ECB's upbeat message may keep the shared currency bid. See: EUR/USD to surge towards 1.2349 and beyond amid a tone of quiet transformation – DBS Bank There are better chances for EUR/USD to rise than fall “Growth without inflation, does it get better than that? That has been the message from the European Central Bank, which could lead to fresh gains on Friday, assuming no new fears for markets. The ECB acknowledged better prospects for the old continent while pledging to keep supporting it with its bond-buying scheme. Since the pandemic broke out, euro-printing has proved positive for the common currency, as it supports government spending. Additional positive comments are also promising for euro bulls.” “President Joe Biden is set to raise taxes on capital gains. Will fears of the taxman continue spooking markets? It is essential to note that the Commander in Chief pledged such moves on the campaign trail and that such moves still need to pass Congress. If the focus shifts away from this news to other topics – such as the improving virus situation on both sides of the pond – EUR/USD has room to rise.” “The economic calendar features Markit's preliminary Purchase Managers' Indexes for April on both sides of the pond and businesses have likely remained optimistic about the recovery. On the other hand, worries about the rapid spread of the coronavirus in India and Japan may dampen the market mood.” “Resistance awaits at 1.2065, Thursday's high, which defends the April peak of 1.2080. Further above, the upside target is 1.2130.”  “Support below 1.20 is at 1.1950, followed by 1.1930 and 1.1860.”  

The German manufacturing sector continued to improve in April, the preliminary manufacturing activity report from IHS/Markit research showed this Frid

German Manufacturing PMI arrives at 66.4 in Apr vs. 65.8 expected.Services PMI in Germany expands to 50.1 in Apr vs. 50.8 expected.EUR/USD remains firmer but below 1.2050 on mixed German PMIs.The German manufacturing sector continued to improve in April, the preliminary manufacturing activity report from IHS/Markit research showed this Friday.   more to come ...

Germany Markit Services PMI registered at 50.1, below expectations (50.8) in April

Germany Markit Manufacturing PMI above forecasts (65.8) in April: Actual (66.4)

Germany Markit PMI Composite registered at 56, below expectations (56.8) in April

The European Central Bank (ECB) made no new policy announcements or changes in forward guidance at the April Governing Council meeting. There were, ho

The European Central Bank (ECB) made no new policy announcements or changes in forward guidance at the April Governing Council meeting. There were, however, five interesting points from the press conference, Aline Schuiling, Sr. Economist at ABN Amro, reports. See – EUR/USD: ECB release is not an upside catalyst for the euro – OCBC Taper talk dismissed as premature “No taper – ECB President Lagarde made it clear that the Governing Council had not discussed the phasing out of net purchases under the PEPP at the meeting as it was ‘premature’. This was in response to a question pointing out that a number of hawkish national central bank heads had recently signalled that they would be in favour of tapering purchases in the second half of the year. Her comments suggest that this is not a majority view in the Council.” “Focus still on financing conditions – The Council reconfirmed ‘it’s very accommodative monetary policy stance’ and expected ‘purchases under the PEPP over the current quarter to continue to be conducted at a significantly higher pace than during the first months of the year’. In our view there remains some confusion about what the ECB is trying to achieve. Chief Economist Philip Lane had suggested earlier that the aim was to return to December levels of the yield curve, but the latest remarks at the press conference and ECB purchase behaviour suggest that they are content to roughly stabilise yields.” “Economic assessment unchanged – The ECB continued to judge that ‘progress with vaccination campaigns, which should allow for a gradual relaxation of containment measures, should pave the way for a firm rebound in economic activity in the course of 2021’. It repeated that ‘while the risks surrounding the euro area growth outlook over the near term continue to be on the downside, medium-term risks remain more balanced’. At the same time the ECB sounded more convinced that the rise in inflation was transitory and continued to assert that ‘underlying price pressures remain subdued in the context of significant economic slack and still weak demand’.” “Eurozone ≠ US – She made it clear that the economy of the eurozone was not on the same ‘page’ as that of the US and therefore monetary policy would not move in tandem. Indeed, she signalled given the different outlook for the economy and inflation, the ECB’s exit would likely significantly lag that of the US. We judge that the big difference between the outlook in the US compared to the eurozone is that the fiscal stance is far more aggressive in the former.” “Call to speed up fiscal support – Indeed, the Governing Council strengthened its call for the Recovery Fund to become operational and therefore provide fiscal support without further delay. In our view, even assuming the funds are rolled out according to plan, the aggregate fiscal stimulus in the eurozone falls short in the sense that an output gap will remain in the coming years.”  

Even as the AUD/USD pair slipped under 0.7600 earlier this month, economists at Westpac saw the underlying up trend as intact. This week's rebuff from

Even as the AUD/USD pair slipped under 0.7600 earlier this month, economists at Westpac saw the underlying up trend as intact. This week's rebuff from above 0.7800 strikes the Australian bank as a buying opportunity, with any trade into the 0.7600 to 0.7700 region appealing for longs targeting a return to above 0.8000 multi-week/ month. Aussie is cheap below the 0.7700 level “The huge jump in spot iron ore prices to 10 year highs around $187/tonne are backed by record Chinese demand and the ongoing constrained supply confirmed by Vale, BHP and Rio this week. Australia seems set to continue to report historically large trade surpluses. We think the implications of the iron ore price surge are being underestimated in FX markets, with the midpoint of our short term fair value model rising to 0.80, but should come into clearer focus as the federal government's annual Budget looms on 11 May.” “There is concern over Australia's vaccine rollout and the end of the JobKeeper wage support scheme, but employment is already back above pre-pandemic levels, the NAB business conditions index is at a record high and Westpac consumer sentiment at an 11 year high. The RBA will maintain its dovish tone but that still leaves plenty of upside room within A$ fair value ranges.” “The US$ could, and arguably should, garner support from the super strong US data that will be released through May and beyond, plus the explosion of Covid cases in India; China/Taiwan incursions and Russian/Ukraine tensions could also exert downward pressure in risk sentiment in the weeks ahead.” “We look to buy the dip below 0.7700, then add on any further weakness to 0.7600 with a target of the aussie returning to 0.8000 and potentially higher later in May-June.” “The trade will be run with an initial stop at 0.7525, but this will be raised should A$ start to rebound.”  

France Markit PMI Composite above expectations (48.8) in April: Actual (51.7)

France Markit Services PMI came in at 50.4, above forecasts (46.5) in April

France Markit Manufacturing PMI above expectations (59) in April: Actual (59.2)

Austria Industrial Production (YoY) climbed from previous -3.8% to 1.9% in February

The AUD/USD pair maintained its bid tone through the early European session and was last seen hovering near the top end of its intraday trading range,

Sustained USD selling bias assisted AUD/USD to regain positive traction on Friday.Fresh COVID-19 jitters, cautious mood to cap gains for the perceived riskier aussie.The formation of a head and shoulders further warrants caution for bullish traders.The AUD/USD pair maintained its bid tone through the early European session and was last seen hovering near the top end of its intraday trading range, around the 0.7730-35 region. Following an early dip to one-and-half-week lows, the pair attracted some fresh buying near the 0.7690 region and has now recovered a major part of the previous day's negative move. The uptick was sponsored by the emergence of some fresh selling around the US dollar, which remained depressed amid speculations that the Fed will keep interest rates low for a longer period. The market now seems convinced with the view that any spike in inflation is likely to be temporary and have been scaling back their expectations for an earlier than anticipated Fed lift-off. This was evident from the fact that the USD bulls largely shrugged off Thursday's upbeat US Jobless Claims data and also seemed unimpressed by a modest uptick in the US Treasury bond yields. That said, a softer tone around the equity markets might keep a lid on any runaway rally for the perceived riskier Australian dollar. Investors turned cautious amid renewed fears about another dangerous wave of coronavirus infections in some countries. The risk sentiment was further hit by reports that the Biden administration is seeking an increase in the capital gains tax. Even from a technical perspective, the recent price action constitutes the formation of a bearish head and shoulders on intraday charts. This makes it prudent to wait for some strong follow-through buying before positioning for any further gains. Conversely, sustained weakness below the 0.7700-7690 region will reaffirm the bearish pattern and turn the AUD/USD pair vulnerable to slide further. Market participants now look forward to the US economic docket, highlighting the release of the flash Manufacturing and Services PMI prints. The data will offer fresh insight into how the economy is performing. This, along with the broader market risk sentiment, should provide some impetus to the AUD/USD pair and allow traders to grab short-term opportunities on the last day of the week. Technical levels to watch  

The tensions in the Donbass area near the border of Ukraine and Russia represent a new tail risk for the RUB. As such, USD/RUB has moved higher. The l

The tensions in the Donbass area near the border of Ukraine and Russia represent a new tail risk for the RUB. As such, USD/RUB has moved higher. The latest US sanctions will have limited economic impact on Russia but the risks of even tougher sanctions will continue to weigh on RUB, economists at Danske bank appraise. See: USD/RUB risks a visit to the 72.65/54 area while below April high at 78.04 – Commerzbank Risks related to the Ukrainian situation remain high “Rapid escalation still seems unlikely, as in reality, Russia has little to gain by attempting invasion of Ukrainian territory. The Kremlin has mentioned domestic security as a reason for strengthening the military presence in the area, but the economic damage caused by possible new sanctions would outweigh any possible gains Russia could achieve in Eastern Ukraine.” “The Biden administration seems to take a harsher approach on Russia than Trump did. Latest US sanctions block US institutions from investing into newly issued Russian sovereign debt, but the economic and market consequences may not be too big as the financing needs of Russia are limited going forward. However, the risk of further escalation in the Donbass area and US criticism of the treatment of Navalny will keep risks of new sanctions alive.” “Despite our generally bullish view on RUB given the strong economic fundamentals, Kremlin’s strategy of maintaining constant pressure on Ukraine (and the west) seems to lead Russia from one conflict to another, meaning the sanctions discount in the RUB is here to stay. As such, we revised our EUR/RUB forecast higher to 89 in 1-3M, 84 in 6M and 83 in 12M.”   

After increasing significantly in the first quarter of this year, long-term Treasury yields have slipped back a bit this month. The 10-year yield, for

After increasing significantly in the first quarter of this year, long-term Treasury yields have slipped back a bit this month. The 10-year yield, for example, which increased by ~80bp in Q1, has since fallen by ~20bp. Nevertheless, economists at Capital Economics don’t see a fundamental argument for lower long-term yields, and think that they will resume their rise before long. The recent fall in long-term Treasury yields will not persist “Very rapid economic growth is on the way this year and next. We think the stage is set for a significant pick-up in inflation in the near-term, perhaps even more than is currently discounted in markets. And this may cause investors to factor in a tighter stance of policy further down the line, even if they believe the Fed when it suggests it is in no rush to tighten over the next couple of years. We expect this to help push up long-term real yields over the next couple of years.”  “We are sticking with our projections for the 10-year US Treasury yield. We forecast it to reach 2.25% and 2.50% by end-2021 and end-2022, respectively, compared with its current level of ~1.6%.”  

GBP/USD has rallied to and so far failed at key resistance offered by 1.4018, the March high. Cable should now stabilize and re-try the topside as Kar

GBP/USD has rallied to and so far failed at key resistance offered by 1.4018, the March high. Cable should now stabilize and re-try the topside as Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, is looking for further US dollar weakness. GBP/USD to hold off the nine-month uptrend at 1.3680 “Near-term dips are indicated to hold around 1.3825 and should find some initial support offered by the 20-day ma at 1.3815 and the previous downtrend at 1.3777.  “A close above 1.4018 will target 1.4238/45, the recent high and the March 2018 high.”  “Dips lower will find additional support at 1.3717, the mid-April low, and be contained by the nine-month uptrend line at 1.3680.”  

EUR/USD is hovering above 1.20. The pair extended higher amid Lagarde’s presser but retraced lower subsequently. There are soundbites for both hawks a

EUR/USD is hovering above 1.20. The pair extended higher amid Lagarde’s presser but retraced lower subsequently. There are soundbites for both hawks and doves to take away but as the ECB is not leaning hawkish at this point, upside potential for the euro remains limited, per OCBC Bank. See: EUR/USD to surge towards 1.2349 and beyond amid a tone of quiet transformation – DBS Bank Lagarde gave very little in terms of concrete policy direction “There are bits to take away from the ECB meeting for both EUR/USD bulls and bears, but the failure to come out net-hawkish (in our opinion) should cap the immediate topside for the pair.” “Near-term, the focus shifts to global preliminary PMIs later on Friday for a gauge of how EZ economic activity held out during the latest round of virus resurgence.” “The 1.2000 to 1.2080 range is still governing, but with upside momentum fading.”  

EUR/USD has consolidated within a 4.4% price corridor since February, but this phase of consolidation is changing to a tone of quiet transformation. T

EUR/USD has consolidated within a 4.4% price corridor since February, but this phase of consolidation is changing to a tone of quiet transformation. Technically, the recent EUR decline to 1.1704 proved to be light-weighted, suggesting the pair is shifting to a basing pattern, Benjamin Wong, Strategist at DBS Bank, briefs. EUR/USD is seeing basing action  “While EUR’s decline to 1.1704 sufficed to meet our prior expectation of a move towards the 38.2% retracement of 1.2349-1.0638 (January 2021’s spike high to March 2020’s lows), at 1.1695; there is a broad disappointment on the lack of follow-through that would have contoured another decline towards the prior double bottom zone around 1.1603, or even the 50% Fibonacci retracement at 1.1494.”  “The higher return has EUR testing all the key moving average levels from 1.1927 to 1.2057; and on the Ichimoku chart, the Kijun support is steadily pushing higher to 1.1892. All these are hinting that EUR is attempting a basing.” “This quiet transformation remains a test of patience. EUR has the required momentum over the Ichimoku cloud resistance of 1.2092, and 1.2113 the dropped-down resistance that connects 1.2349 (early January high) and 1.2243 (late February highs). Conversely, EUR needs a strong sustained push over the 61.8% Fibonacci retracement of 1.2349-1.1704, at 1.2103.” “We are in the early stages of a push higher of five legs which would target 1.2349 and beyond.”  

FX Strategists at UOB Group noted the outlook for USD/JPY remains tilted to the downside in the short-term horizon. Key Quotes 24-hour view: “We highl

FX Strategists at UOB Group noted the outlook for USD/JPY remains tilted to the downside in the short-term horizon. Key Quotes 24-hour view: “We highlighted yesterday that ‘the underlying tone still appears to be a tad soft but any weakness is viewed as part of a lower range of 107.80/108.25’. We added, ‘a clear break of 107.80 is unlikely’. In line with our expectations, USD traded between 107.80 and 108.23 before closing little changed at 107.96 (-0.08%). The bias for today appears to be tilted to the downside but the major support at 107.65 is unlikely to come under threat (107.80 is already quite a strong level). On upside, a break 108.25 (minor resistance is at 108.10) would indicate that the current mild downward pressure has eased.” Next 1-3 weeks: “USD traded in a quiet manner for the past couple of days and our latest narrative from Tuesday (20 Apr, spot at 108.15) still stands. As highlighted, USD is likely to weaken further but the major support at 107.65 may not come into the picture so soon. On the upside, a break of 108.55 (‘strong resistance’ level previously at 108.85) would indicate that the pullback in USD that started about 2 weeks ago (see annotations in the chart below) has run its course. Looking ahead, the next support below 107.65 is at 107.30.”

Friday's economic docket highlights the release of the flash version of Eurozone PMI prints, scheduled during the early European session. The German a

German/ Eurozone flash PMIs Overview Friday's economic docket highlights the release of the flash version of Eurozone PMI prints, scheduled during the early European session. The German and the composite Eurozone PMI hold more relevance in terms of their impact on the shared currency. The Germany Manufacturing PMI, due at 073:0 GMT, is anticipated to have eased from a record high level of 66.6 to 65.8 in April. The gauge for the services is also expected to slow a bit to 50.8 from 51.5 in March, though remain in the expansion territory for the second straight month. Separately, the Eurozone flash manufacturing PMI (due at 08:00 GMT) is foreseen at 62 April, down from 62.5 in the previous month. The Eurozone services sector PMI is likely to show a contraction for the eights straight month and fall to 49.1 from 49.6 in March. How could they affect EUR/USD? The preliminary estimates will offer fresh insight into how the region's economy is performing amid the pandemic-related challenges. Given the market expectations for a modest slowdown, surprisingly stronger readings would bound well with the ECB's optimism about a strong economic recovery and push the euro higher into the end of the week. Conversely, weaker PMIs could send the EUR/USD pair tumbling lower below the key 1.2000 psychological mark. Valeria Bednarik, Chief Analyst at FXStreet offered a brief technical outlook for the major and explained: "The near-term picture is bearish, as the pair is extending its decline below a 20 SMA that has lost directional strength. The longer moving averages remain well below the current level, and with the 100 SMA advancing above the 200 SMA." "Technical indicators, on the other hand, hold within negative levels, with the Momentum aiming to recover but the RSI heading south around 45. Another leg south should be expected on a break below the 1.1990 region, where the pair met intraday buyers several times this week," Valeria added further. Key Notes   •  EUR/USD Outlook: Bulls have the upper hand above 1.2000, Eurozone PMIs eyed   •  EUR/USD defends 1.2000 ahead of PMI data, ECB’s Lagarde   •  EUR/USD now focuses on 1.1965 – UOB About German/ Eurozone flash PMIs The Manufacturing Purchasing Managers Index (PMI) released by the Markit Economics captures business conditions in the manufacturing sector. As the manufacturing sector dominates a large part of total GDP, the manufacturing PMI is an important indicator of business conditions and the overall economic condition in the Euro Zone. Usually, a result above 50 signals is bullish for the EUR, whereas a result below 50 is seen as bearish.

Traders scaled back their open interest positions for the fourth consecutive session on Thursday, this time by around 4K contracts, as per flash data

Traders scaled back their open interest positions for the fourth consecutive session on Thursday, this time by around 4K contracts, as per flash data from CME Group. On the flip side, volume reversed two daily drops in a row and went up sharply by around 142K contracts, the largest single day build since February 16. Natural Gas still targets $2.90 Further gains in Natural Gas could face some headwinds in the very near-term, as Thursday’s positive move was on the back of shrinking open interest. However, the noticeable build in open interest could still lend some legs to the commodity. That said, the next target of note is seen at the $2.90 mark per MMBtu.  

GBP/USD is licking its wounds around 1.3850. After succumbing to dollar strength, sterling can recover as upbeat UK data may counter dollar domination

GBP/USD is licking its wounds around 1.3850. After succumbing to dollar strength, sterling can recover as upbeat UK data may counter dollar domination, according to FXStreet’s Analyst Yohay Elam. PMIs and further reactions to proposed tax hikes are set to move markets “British Retail Sales surged by 5.4% in March, more than triple the early expectations and on top of upward revisions. YoY, the increase is 7.2%. UK shoppers have been out and about after several restrictions were lifted in early March. That allows the pound to recover.”  “Markit's preliminary Purchasing Managers' Indexes for March are eyed later in the day, with figures for both the services and manufacturing sectors set to remain robust.”  “The main upside driver for the greenback has come from the White House. While the general media focuses on President Joe Biden's climate commitments, the administration's intent to raise taxes on capital gains for high-earners has rattled markets. The S&P 500 Index dropped nearly 1% and investors sought the safety of the greenback.” “Investors are concerned about India's worsening covid situation after the nation hit yet a new infections record of over 330,000. The UK's travel ban on flights from the large south-Asian nation has come into effect and worries about global growth are weighing on sentiment.”  “Support awaits at the daily low of 1.3820, followed closely by 1.38, which capped GBP/USD earlier this month. Some resistance is at 1.3860, the daily high, followed by 1.3885, a swing low from Thursday.”  

Heading into the final trading day of this week, gold has turned positive once again, looking to retake the $1800 mark, as the upside bias remains int

Heading into the final trading day of this week, gold has turned positive once again, looking to retake the $1800 mark, as the upside bias remains intact amid bullish technical setup, FXStreet’s Dhwani Mehta briefs. See – Gold Price Analysis: XAU/USD to climb towards the $1857/83 area – Credit Suisse News on Biden’s tax proposal, US PMIs and covid updates in focus “The greenback has resumed its bearish momentum amid improving market mood, as investors appear to move past Biden’s tax hike reports. The US Treasury yields are stabilizing after the previous drop, although its impact on the yieldless gold is likely to be limited, as the technical setup remains in favor of the bulls.”  “Markets look forward to the Eurozone and US PMI reports from fresh hints on the post-pandemic global economic recovery. Meanwhile, the covid vaccines and infections updated will be closely eyed as well.” “A daily closing above the $1800 threshold is needed to revive the double bottom bullish reversal. The 100-DMA at $1804 would be the next bullish target, above which the doors are likely to open up towards the February 24 high of $1814.” “A drop below Thursday’s low of $1777 is likely to put this week’s low at $1764 at risk. Further down, the confluence of the 21 and 50-DMAs at $1747 is the level to beat for the XAU bears.”  

In opinion of FX Strategists at UOB Group, AUD/USD should keep the 0.7660-0.7800 side-lined theme unchanged for the time being. Key Quotes 24-hour vie

In opinion of FX Strategists at UOB Group, AUD/USD should keep the 0.7660-0.7800 side-lined theme unchanged for the time being. Key Quotes 24-hour view: “Yesterday, we held the view that AUD ‘could edge above 0.7775’. Our expectation did not materialize as AUD registered a high of 0.7765. However, the sharp sell-off in AUD during NY session that sent it to a low of 0.7692 came as a surprise. While the rapid drop appears to be a bit overdone, the weakness in AUD could test 0.7685 first before stabilizing. Resistance is at 0.7730 followed by 0.7755.” Next 1-3 weeks: “We continue to hold the same view as from Wednesday (21 Apr, spot at 0.7730). As highlighted, the current movement is viewed as the early stages of a consolidation phase and AUD is expected to trade between 0.7660 and 0.7800 for now. While the underlying tone has softened somewhat, it is too early to expect a clear break of 0.7660.”

CME Group’s advanced prints for Crude Oil futures markets noted open interest dropped for the second session in a row on Thursday, this time by around

CME Group’s advanced prints for Crude Oil futures markets noted open interest dropped for the second session in a row on Thursday, this time by around 10.5K contracts. Volume followed suit and went down markedly for the second consecutive day, now by around 195.6K contracts. WTI: Gains appear limited around $64.00 Thursday’s positive price action in WTI came amidst declining open interest and volume, hinting at some loss off upside momentum in the commodity, at least in the very near-term. On the upside, occasional bullish attempts in WTI are expected to struggle around the $64.00 mark per barrel.  
The UK Retail Sales came in at 5.4% MoM in March.Core Retail Sales for the UK rose by 4.9% MoM in March.The cable keeps its range around 1.3860 on upbeat UK Retail Sales.more to come ...

USD/CHF holds lower ground near 0.9167, down 0.03% intraday, ahead of Friday’s European session. In doing so, the major currency pair respects Thursda

USD/CHF stays pressured following a bearish candlestick formation of the previous day.Sustained trading below 50-day SMA, downbeat MACD also backs sellers to eye 200-day SMA.USD/CHF holds lower ground near 0.9167, down 0.03% intraday, ahead of Friday’s European session. In doing so, the major currency pair respects Thursday’s bearish Doji, as well as seller-supportive MACD conditions. Also backing the USD/CHF bears is the pair’s sustained trading below 50-day SMA, which in turn highlights another attempt to revisit the 200-day SMA level of 0.9089. During the fall, the weekly bottom surrounding 0.9130 and the 0.9100 round-figure may offer intermediate halts. Meanwhile, an upside break of the 0.9200 threshold will defy the bearish Doji and could direct the USD/CHF prices toward a 50-day SMA level of 0.9220. It’s worth mentioning that the previous month’s lows add strength to the 0.9220 hurdle. In a case where the quote rises beyond 0.9220, USD/CHF bulls may not refrain to target mid-March tops near 0.9320 wherein the 0.9250 level can act as a buffer during the rise. USD/CHF daily chart Trend: Further weakness expected  

Cable is now seen navigating within the 1.3750-1.3950 range in the next weeks, suggested FX Strategists at UOB Group. Key Quotes 24-hour view: “The su

Cable is now seen navigating within the 1.3750-1.3950 range in the next weeks, suggested FX Strategists at UOB Group. Key Quotes 24-hour view: “The sudden and sharp sell-off in GBP came as a surprise (we were expecting GBP to trade sideways). Downward momentum is relatively robust and GBP could decline further but oversold conditions could ‘limit’ any weakness to a test of 1.3795. The next support at 1.3750 is unlikely to come into the picture. Resistance is at 1.3875 followed by 1.3900. A break of 1.3900 would indicate that the current downward pressure has eased.” Next 1-3 weeks: “Our latest narrative was from Tuesday (20 Apr, spot at 1.3990) where we indicated that GBP ‘could advance further even though the next major resistance at 1.4100 may not come into the picture so soon’. The sharp drop yesterday (22 Apr) that cracked our ‘strong support’ level at 1.3850 came as a surprise (low of 1.3825). The break of the ‘strong support’ indicates that the GBP strength that started one week ago has topped out at 1.4009. The current movement is viewed as the early stages of a consolidation phase and GBP is expected to trade between 1.3750 and 1.3950 for now.”

United Kingdom Public Sector Net Borrowing above expectations (£22.064B) in March: Actual (£27.271B)

Open interest in Gold futures markets shrunk by around 2.6K contracts on Thursday, partially reversing the previous daily build according to prelimina

Open interest in Gold futures markets shrunk by around 2.6K contracts on Thursday, partially reversing the previous daily build according to preliminary readings from CME Group. In the same line, volume went down by around 11.6K contracts, extending the choppiness seen as of late. Gold meets strong hurdle around $1,800 The upside momentum in Gold met a tough nut to crack around the $1,800 mark per ounce troy so far. Thursday’s downtick, however, was on the back of shrinking open interest and volume, leaving the door open to another attempt to break that key resistance area in the very near-term.    

UOB Group’s FX Strategists expect further gains in EUR/USD as long as it trades above the 1.1965 level. Key Quotes 24-hour view: “Yesterday, we held t

UOB Group’s FX Strategists expect further gains in EUR/USD as long as it trades above the 1.1965 level. Key Quotes 24-hour view: “Yesterday, we held the view that EUR ‘could edge higher to 1.2060 but is unlikely to break the next resistance at 1.2080’. Our view was not wrong as EUR rose to 1.2069. That said, we did not anticipate the subsequent sharp and swift sell-off (EUR fell to 1.1992 during NY hours). While downward momentum has not improved by much, there is room for EUR to drop below the overnight low. However, any weakness is viewed as part of a lower range of 1.1985/1.2045. In other words, a clear break of 1.1985 is unlikely.” Next 1-3 weeks: “Our update from yesterday (22 Apr, spot at 1.2035) still stands. As highlighted, the positive phase that started more than 2 weeks ago is still intact as long as EUR does not move below 1.1965. That said, upward momentum is beginning to wane and the prospect for EUR to advance to 1.2115 has diminished. From here, EUR has to move and stay above 1.2070 within these 1 to 2 days or a break of 1.1965 (no change in ‘strong support’ level) would not be surprising and would indicate that the positive phase has ended.”

FX option expiries for Apr 23 NY cut at 10:00 Eastern Time, via DTCC, can be found below. - EUR/USD: EUR amounts 1.1850 402m 1.1900 573m 1.1980 741m 1

FX option expiries for Apr 23 NY cut at 10:00 Eastern Time, via DTCC, can be found below. - EUR/USD: EUR amounts         1.1850 402m 1.1900 573m 1.1980 741m 1.1990/00 748m 1.2250 491m - GBP/USD: GBP amounts         1.3900 650m 1.4000 494m - USD/CAD: USD amounts        1.2440/50 1.7b1.2500 1b1.2550 421m1.2580 1.1b    

Here is what you need to know on Friday, April 23: Stock markets are on the back foot amid concerns of higher US capital tax increases and rising covi

Here is what you need to know on Friday, April 23:  Stock markets are on the back foot amid concerns of higher US capital tax increases and rising covid cases in Asian countries. Cryptocurrencies are suffering an extended sell-off. PMIs from Europe, the UK and the US stand out.  The White House is mulling a substantial hike to capital tax gains for high-earners, in an attempt to fund social programs. Passing such legislation would fulfill campaign promises but the news caught markets wrong-footed, with the S&P 500 falling on Thursday the most since March. Global equities are trying to recover on Friday. Investors are also concerned about India's horrendous coronavirus wave. The country hit a new record in infections, around 330,000 and the death toll is also on the rise. Japan is also adding restrictions amid a new wave.  US 10-year Treasury yields have stabilized around 1.55%, pushing the dollar lower after safe-haven flows underpinned it on Thursday. The greenback also received support from jobless claims, which surprised with a drop to 547,000. Markit's Purchasing Managers' Indexes for April and New Home Sales figures are eyed in the US session.Preliminary PMIs stand out in the European session as well, with economists expecting them to fall off their highs despite optimism about Europe's reopening. The European Central Bank moderately upgraded its views in Thursday's rate decision, saying that medium-term risks are balanced. EUR/USD is hovering above 1.20. See ECB Analysis: Lagarde offers four subtle changes that may send the euro higherGBP/USD is licking its wounds around 1.3850 ahead of UK Retail Sales and PMIs. The country is set to reach 50% with one vaccine shot in the coming days. Bitcoin has tumbled down below $50,000, down some 20% from the peak near $65,000 but still some 80% higher year-to-date. Tax hikes, legal issues and an unfavorable technical situation have been cited as reasons for the extended falls.  See Bitcoin falls below $50K as investors rush to exit crypto markets on Biden's tax proposal      

Gold drops 0.03% despite the latest corrective pullback to $1,784 ahead of Friday’s European session. In doing so, the yellow metal respects the previ

Gold extends Thursday’s losses from two-month top, bounces off intraday low.Downbeat momentum signals further weakness but 100-HMA, eight-day-old support line tests intraday sellers.Bulls need a clear break above $1,798 to regain market acceptance.Gold drops 0.03% despite the latest corrective pullback to $1,784 ahead of Friday’s European session. In doing so, the yellow metal respects the previous day’s U-turn from the highest levels since late February. Given the Momentum indicator flashing sluggish signs, the commodity prices can stay pressured. However, a convergence of 100-HMA and an ascending support line from April 13 near $1,781 challenges the metal sellers. Should the quote remain depressed below $1,781, the weekly bottom surrounding $1,763 and last Friday’s low near $1,760 will be in the spotlight. Meanwhile, the corrective pullback will aim for the $1,790 hurdle comprising multiple levels marked since Monday, a break of which should direct gold buyers toward the key $1,798 resistance comprising recent highs. It’s worth mentioning that the bullion’s upside past $1,798 needs validation from the $1,700 psychological magnet before eyeing the top late February downswing, near $1,816. Gold hourly chart Trend: Further weakness expected  

Markets in Asia fail to cheer China’s upbeat performance during early Friday. The reason could be traced from the coronavirus (COVID-19) fears in the

Asian shares trade mixed even as equities in Beijing rally.Vaccine optimism, doubts over Biden’s tax plan back the bulls.Covid woes in India, Japan’s readiness for emergencies in Tokyo and three prefectures weigh on market sentiment.Preliminary PMIs for April become the key amid global claims of faster economic recovery.Markets in Asia fail to cheer China’s upbeat performance during early Friday. The reason could be traced from the coronavirus (COVID-19) fears in the region and the previous day’s losses on Wall Street. Read: Wall Street Close: Bears look set to snap four-week uptrend on fears of US capital gains tax hike MSCI’s index of Asia-Pacific shares, ex-Japan, rises 0.45% but Japan’s Nikkei 225 drops 0.80% by the press time of the pre-European session. Aussie stocks couldn’t cheer welcome prints of the Commonwealth Bank of Australia’s (CBA) preliminary PMIs for April on finding the first covid infection at home in multiple days. Though, New Zealand’s NZX 50 gain over half a percent while copying moves from China. Beijing benefits from a run-up in blue-chip equities while shares in Hong Kong, South Korea and Indonesia follow the suit, although with mild reaction. On a broader front, S&P 500 Futures rise 0.20% and the US 10-year Treasury yield snap a three-day losing streak when being around 1.56%. Expectations of the Johnson & Johnson’s vaccine to regain acceptance after today's key verdict in the US while faster jabbing in Canada and the UK’s confirmation that inoculation is benefitting amid the pandemic also favor the risk-on mood. Read: S&P 500 Futures: Mildly bid as vaccine hopes battle Biden’s tax hike proposal, covid fears Although covid fears from India and Japan are likely to keep Asian markets pressured, expected strong Markit PMIs for Eurozone, the US and the UK may restore investor confidence.

Ireland Consumer Confidence up to 77.9 in April from previous 77.1

Singapore Consumer Price Index (YoY) above forecasts (0.6) in March: Actual (1.3)

USD/INR prints a three-day losing streak while taking the offers around 75.00 threshold, down 0.10% intraday, amid the initial Indian trading session

USD/INR refreshes intraday low inside a bearish chart pattern.Failures to stay beyond 75.50 hurdle, normal RSI conditions suggest momentum weakness.Late-March top, 200-SMA confluence eyed on break of 74.95.USD/INR prints a three-day losing streak while taking the offers around 75.00 threshold, down 0.10% intraday, amid the initial Indian trading session on Friday. The Indian rupee pair’s pullback from 75.63 portrays a bearish chart pattern on the four-hour (4H) play. The RSI conditions also favor the continuation of the recent pullback. As a result, USD/INR sellers keenly await a downside break of 74.95 to confirm the bearish formation and look for the 73.60 support level comprising 200-SMA and March-end tops. During the fall, the 74.20 figure including April 08 low can act as a buffer whereas the 73.00 round-figure could lure USD/INR bears past-73.60. Alternatively, the corrective pullback may eye 75.30 before battling the 75.50-52 upside hurdle that consists of multiple highs marked since July 2020. Also acting as the resistance is an upper line of the stated rising wedge, near 75.70 by the press time. USD/INR four-hour chart Trend: Further weakness expected  

EUR/USD is back on the bid above 1.2000, snapping three straight days of sluggishness. The US dollar has resumed its downtrend, helping the spot to ma

EUR/USD turns north once again, with eyes on the 100-DMA barrier. US dollar meets fresh supply amid improving market mood. The daily technical setup appears in favor of the EUR bulls. EUR/USD is back on the bid above 1.2000, snapping three straight days of sluggishness. The US dollar has resumed its downtrend, helping the spot to make another attempt towards 1.2050. Eurozone/US PMIs will offer fresh cues later this Friday. The greenback is losing ground once again, as the risk sentiment improves, with investors moving past the Bloomberg report, which cited that US President Joe Biden is considering hiking the capital gains to pay for his social plan. The US tax hike chatters triggered a fresh sell-off in Wall Street indices and yields, boosting the haven demand for the greenback. Meanwhile, the European Central Bank (ECB) monetary policy announcement turned out to be a non-event, which disappointed the hawks and added to the weight on the euro. EUR/USD technical outlook At the time of writing, the EUR/USD pair is challenging daily highs near 1.2025, as the bulls keep their sight once again on the critical 100-daily moving average (DMA) at 1.2055. Note that the price has failed to find acceptance above that hurdle since March 4. Recapturing that level is critical to extending the upside towards Thursday’s high of 1.2069. EUR/USD daily chart The 14-day Relative Strength Index (RSI) edges slightly higher above the midline, allowing room for more gains.   On the flip side, the mildly bearish 50-DMA at 1.1955 could offer strong support. Ahead of that the sellers could target the 1.2000 psychological mark. EUR/USD additional levels to watch  

GBP/USD stays mildly bid around mid 1.3800s, up 0.11% intraday, while heading into Friday’s London open. In doing so, the cable pares the heaviest los

GBP/USD consolidates the heaviest losses in nearly two weeks.Vaccine hopes, doubts over Biden’s capital gains tax hike proposal portray mild risk-on mood.Brexit jitters renew ahead of April 27 deadline, French fisherman eyes blockade ports over no access to UK waters.CBI hints British factories expect strongest rebound since 1973, Retail Sales for March, April’s preliminary PMIs bear upbeat forecasts.GBP/USD stays mildly bid around mid 1.3800s, up 0.11% intraday, while heading into Friday’s London open. In doing so, the cable pares the heaviest losses in 12 days as risks benefit from covid vaccine updates and optimism concerning the key statistics from the UK. UK scientists back claim that vaccines slash the coronavirus (COVID-19) infections with a 65% success ratio among adults, even as the study was conducted amid spreading virus variants, per Reuters. Elsewhere, increasing odds over the Johnson & Johnson vaccine’s return to the shelf, after discontinuation over blood clotting issues, join faster jabbing in the West to print vaccine optimism. Elsewhere, The Sun came out with the news suggesting French fishermen will launch a blockade of UK exports to the continent in protest at lost access to the British waters. This came when the European Union (EU) and the UK are already jostling over the Northern Ireland (NI) protocol ahead of the deadline to sign the final deal on April 27. The UK’s post-Brexit deal isn’t only struggling when it comes to the EU but has recently roiled when noticing developments concerning trade pact with Australia and New Zealand (NZ). While Australia gives high priority to the deal with the bloc, NZ marked its ties with China as a weak point to agree with England inside the five-eye group that also consists of the US, Canada and Australia as other members. Also challenging  optimism for GBP/USD could be The Guardian’s news saying, British MPs voted to declare that China is committing genocide against the Uyghur people in Xinjiang province.” Amid these plays, stock futures print mild gains during the aftershocks of US President Joe Biden’s proposal to hike capital gains tax. However, the US 10-year Treasury yields stay undecided near 1.56% whereas the US dollar index (DXY) drops 0.10% by the press time. Looking forward, the UK’s Retail Sales for March is expected to reverse the previous -3.7% contraction with +3.5% YoY figures whereas Manufacturing and Services PMIs are also up for a strong recovery during their April’s flash readings. As per the Confederation of British Industry’s (CBI) quarterly survey of manufacturers, UK manufacturers hope for an economic rebound rose to their strongest in 48 years this month as the country began to recover from the slump caused by the COVID-19 pandemic. It should be noted that the US PMIs for the said period is also up for publishing during the North American session and can keep the GBP/USD pressured amid hopes of upbeat outcomes. However, risk-on mood may weigh on the US dollar and hence the sterling has brighter spots to remain on the front foot. Technical analysis The upbeat forecasts for the scheduled UK data and recovery in the MACD signals back the GBP/USD bulls. As a result, an upside break of 200-HMA level around 1.3845 can escalate the recovery moves toward Wednesday’s low near 1.3885. Though, a convergence of 100-HMA and four-day-old resistance line around 1.3920-25 will be a tough nut to crack for buyers. Meanwhile, sellers need a clear break below an upward sloping trend line from April 12, around 1.3833 by the press time, to direct the quote towards 61.8% Fibonacci retracement of April 12-20 upside, close to the 1.3800 threshold.  

Gold (XAU/USD) is attempting a tepid bounce after falling 1% on Thursday amid a sharp recovery staged by the US dollar. Risk-aversion gripped the mark

Gold (XAU/USD) is attempting a tepid bounce after falling 1% on Thursday amid a sharp recovery staged by the US dollar. Risk-aversion gripped the markets on Bloomberg report that the Biden administration is proposing higher taxes on the wealthy to pay for its social plan. Flight to safety lifted the safe-haven greenback at the expense of stocks and gold. However, the losses in the yellow metal were limited by the sell-off in Treasury yields as well. The focus now remains on the dynamics in the yields and the dollar for fresh trading impetus. In the meantime, let's take a look at how gold is positioned on the technical charts? Gold Price Chart: Key resistance and support levels The Technical Confluences Detector shows that gold looks to recapture the Fibonacci 61.8% resistance at $1791. A break above which would clear the path towards $1796, the pivot point one-day R1. Further up, the XAU buyers need to find acceptance above $1800 to take on the further upside. That level is the confluence zone of the previous day high, pivot point one-week R and pivot point one-month R2.   Alternatively, gold is likely to find solid demand around $1786, where a cluster of minor support levels lies, which comprises of the previous high four-hour and Fibonacci 38.2% one-day. The next support is seen at the previous week high of $1784, below which the convergence of the Fibonacci 23.6% one-day and SMA5 one-day at $1781 could get tested. The Fibonacci 23.6% one-week at $1771 could be challenged if the previous day low of $1777 gives way. Here is how it looks on the tool          About Technical Confluences Detector   The TCD (Technical Confluences Detector) is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

“Japan's economy continued to expand gradually due to aggressive monetary easing, which has had a positive impact on bank profits,” the Bank of Japan

“Japan's economy continued to expand gradually due to aggressive monetary easing, which has had a positive impact on bank profits,” the Bank of Japan (BOJ) Governor Haruhiko Kuroda said while speaking before the parliament on Friday. Kuroda added: “Banks' profitability has diminished as a trend due to prolonged low-rate environment, structural factors such as aging population.” "I don't think the Bank of Japan (BOJ) is undertaking a negative rate policy because Japan's public debt balance is high. I also don't think negative rates are cooling the economy," the country Finance Minister Taro Aso said, defending the central bank’s negative interest rates policy. Aso further said that the “government is ready to tap reserves set aside for covid relief to deal with further costs if infections rise more or battle with a pandemic is prolonged.”

One-month risk reversal on USD/CNY, a measure of the spread between prices drawn by call options (bullish bets) and put options (bearish bets), turns

One-month risk reversal on USD/CNY, a measure of the spread between prices drawn by call options (bullish bets) and put options (bearish bets), turns positive for the first time after April 13, to +0.050 the latest, per data source Reuters. This goes hand-in-hand with the latest USD/CNY moves as the quote extends recovery moves from March 13, tested the previous day, while flashing the strongest intraday gains in two weeks, up 0.12% on a day around 6.4983 by the press time. While the options market suggests the return of bulls, backed by recent risk-on mood, traders keenly await the preliminary readings of April activity numbers for fresh impulse. Read: S&P 500 Futures: Mildly bid as vaccine hopes battle Biden’s tax hike proposal, covid fears

US economic growth for this year is peaking – Goldman Sachs more to come ..

US economic growth for this year is peaking – Goldman Sachs  more to come ..

S&P 500 Futures defend 4,100 threshold, up 0.20% intraday around 4,135 by the press time of early Friday. Even so, the risk barometer remains on track

S&P 500 Futures pare weekly losses amid mixed clues.Hopes over J&J vaccine, Canada’s faster jabbing join fewer odds favoring US President’s capital gains proposal to recall risk-on mood.Australia, New Zealand turn cautious over covid, Japan prepares for emergency in Tokyo and three prefectures.Preliminary readings of April PMIs will be the key.S&P 500 Futures defend 4,100 threshold, up 0.20% intraday around 4,135 by the press time of early Friday. Even so, the risk barometer remains on track to snap a four-week uptrend. Wall Street benchmarks rejected Wednesday’s recovery moves on US President Joe Biden’s 40% tax hike proposal for capital gains the previous day. Also challenging the market sentiment was the coronavirus (COVID-19) fears emanating from Asia and downbeat updates over the Aussie-China and Iran-Iraq tussles, not to forget the Russia-Ukraine tension. Read: Wall Street Close: Bears look set to snap four-week uptrend on fears of US capital gains tax hike It should, however, be noted that the reassessment of market risks highlights the fact that the Democratic Party holds a thin majority in the US House and the Senate, which in turn dims fears of tax hike for wealthy American investors. Further, increasing odds of Johnson & Johnson regaining its vaccine approval from the US Centers for Disease Control and Prevention (CDC) joins Canada's upbeat vaccination drive to recall the buyers. Ottawa’s jabbing marches toward the standards of the US, Israel and the UK, as per the COVID-19 vaccine progress data from the Organization for Economic Co-operation and Development (OECD). Even so, Japan’s readiness to recall emergency in Tokyo and surrounding three prefectures and Australia’s first infection case in multiple days challenge the bulls. Additionally, New Zealand recently joined the Western countries to tighten border controls following the recent covid resurgence, which in turn offer an extra burden on the market sentiment. Amid these plays, the US 10-year Treasury yield stabilizes around 1.55% whereas the US dollar index (DXY) drops back towards 91.00. With the flash readings of April activity numbers from Markit are up for publishing, global traders will check whether the cautious optimism in Europe, the UK and the US is worth believing or not.

Thanks to a strong recovery momentum building up in most major economies, the global economy is set to rebound from its coronavirus slump at the faste

Thanks to a strong recovery momentum building up in most major economies, the global economy is set to rebound from its coronavirus slump at the fastest pace since 1970, the latest Reuters poll of 500 economists showed. Key findings “That optimism was largely led by the widely expected vaccine-driven recovery, massive liquidity injections, unprecedented fiscal support - primarily by the United States.” “But 2021 growth views for 55% of 44 economies polled on were upgraded from three months ago, led by the US economy - which was predicted to mark the fastest annual expansion since 1984 - and China, set to return to pre-crisis levels this year.“ “Over 85% of economists, or 152 of 178, in response to an additional question said the recovery would be faster than previously expected or about the same pace versus the remaining 26 predicting a slower pace of rebound.” “Despite those upgrades to economic growth, the job market recovery was expected to lag, with unemployment rates not forecast to return to pre-crisis levels this year or next for most advanced economies polled on.” “Following massive stimulus and the pandemic-led supply constraints, the 2021 inflation outlook for over 70% of 44 economies polled on was upgraded from previous surveys, with over 80% of 207 economists answering a question saying risks to their already elevated forecasts skewed more to the upside.” Related readsUS economy on a solid footing, coronavirus still top threat – Reuters PollSlow vaccine rollouts biggest risk to Eurozone economy – Reuters Poll

The following is a topdown analysis that shows the weekly chart's compelling bullish case transpiring into a daily reverse head and shoulders. Weekly

GBP/AUD is on the verge of an upside extension from a longer-term perspective.Bulls are seeking to engage once hourly resistance is broken. The following is a topdown analysis that shows the weekly chart's compelling bullish case transpiring into a daily reverse head and shoulders.  Weekly chart At this stage, it looks as though the market will close bullish this week and leave a bullish closing wick that would be expected to be filled up from price action on the lower timer frames during the course of next week.  This makes for a compelling bullish case on the daily chart as follows: Daily chart The bulls are looking for a competition of the reverse head and shoulders and for an extension to test the resistance area ahead.  Bulls can start to prepare for an optimal entry opportunity on the lower time frames, such as the hourly:

US dollar index (DXY) prints mild losses of 0.08% while taking offers around 91.22 during early Friday. In doing so, the greenback gauge versus the ma

DXY marks another pullback from seven-week-old horizontal resistance.Upward sloping trend line from Tuesday offers immediate support.Monthly resistance line, 61.8% Fibonacci retracement add to the upside filters.US dollar index (DXY) prints mild losses of 0.08% while taking offers around 91.22 during early Friday. In doing so, the greenback gauge versus the major currencies again steps back from the key horizontal resistance while trimming the previous day’s recovery moves from a three-day-long rising support line. Not only the sustained trading below an immediate hurdle established from early March but the downward sloping trend line from March 31 and a 61.8% Fibonacci retracement of the previous month’s upside moves also back the US dollar index bears. As a result, the quote is ready to retest the nearby support line, around 91.00 by the press time, before challenging the monthly low, marked earlier in the week, of 90.85. Should the US dollar remains pressured past-90.85 level, March’s bottom near 90.63 will be the key to follow. Alternatively, an upside break of 91.35-40 resistance area will aim for the short-term falling trend line hurdle, close to 91.45, as well as a 61.8% Fibonacci retracement level of 91.70. However, any further upside beyond 91.70 needs to cross the April 16 high of 91.81 to keep the DXY bulls hopeful. DXY four-hour chart Trend: Further weakness expected  

AUD/USD is attempting a comeback above 0.7700, having hit fresh six-day lows at 0.7690 on Thursday after the US dollar rebounded sharply amid risk-ave

AUD/USD attempts a bounce, as bulls regain 0.7700Hourly chart points to a bumpy road to recovery amid bearish RSI. The aussie takes a reprieve from fresh DXY selling. AUD/USD is attempting a comeback above 0.7700, having hit fresh six-day lows at 0.7690 on Thursday after the US dollar rebounded sharply amid risk-aversion. Reports that US President Joe Biden is proposing to hike the capital gains tax triggered a wave of risk-aversion and knocked-off Wall Street indices, lifting the haven demand for the greenback. At the time of writing, the aussie is looking to recapture the 200-hourly moving average support-turned-resistance at 0.7719, as it bounces off daily lows at 0.7698. The renewed uptick in the spot is back by the sharp reversal seen in the Relative Strength Index (RSI) from lower levels. The indicator still remains below the midline, suggesting a shallow recovery for the AUD bulls. Therefore, the bearish 21-HMA at 0.7726 could offer stiff resistance if the rebound extends. The next test for the buyers is seen at the 50-HMA, which is now located at 0.7732. AUD/USD hourly chart Alternatively, a rejection at higher levels could once again recall the sellers, exposing the multi-day lows. The psychological 0.7650 level could be next on the sellers’ radars. AUD/USD additional levels to watch  

EUR/USD picks up bids to refresh intraday top to 1.2021 amid early Friday. While consolidation in the market sentiment seems to favor the quote’s late

EUR/USD eases from intraday high, keeps bounce-off three-day low flashed the previous day.Vaccine hopes battle market pessimism over US President Biden’s Tax hike proposal.Preliminary readings of April’s PMI are expected to soften for Germany, Eurozone but may recover for the US.ECB President Lagarde will be looked for consistency in her post-ECB meeting speech.EUR/USD picks up bids to refresh intraday top to 1.2021 amid early Friday. While consolidation in the market sentiment seems to favor the quote’s latest recovery, traders remain cautious ahead of the key PMIs for April and ECB President Christine Lagarde’s speech. Not only expectations that Johnson & Johnson will get the US Centers for Disease Control and Prevention (CDC) approval to restart its vaccine distribution but Canada’s recently strong jabbing also portrays vaccine optimism. Also, the market’s expectations that adjustments will be made in US President Joe Biden’s capital gains tax hike proposal offer an extra favor to the risk-on mood. Global traders ignored upbeat US data and the European Central Bank’s (ECB) cautious optimism as market sentiment dropped amid fears of higher capital gains tax in the US. Also previously challenging the mood could be the coronavirus (COVID-19) conditions in Asia and geopolitical tension concerning China, Russia and some of the Middle East nations. Amid these plays, S&P 500 Futures pare weekly losses, the first in five, with mild gains on an intraday basis. Further, the US 10-year Treasury yield also stabilizes around 1.55% whereas the US dollar index (DXY) fails to keep Thursday’s recovery moves. Although risk catalysts are likely to keep the driver’s seat, EUR/USD traders will also closely observe the preliminary activity numbers for April to confirm the ECB’s cautious optimism. Even if the German and Eurozone PMIs manage to surpass downbeat forecasts, ECB President Lagarde needs to repeat the previous day’s statement around 14:30 GMT to keep the buyers hopeful. On the other hand, the US Markit PMIs for April, bearing upbeat forecasts, will also be watched closely Technical analysis With the sustained trading below 100-day SMA level of 1.2055, EUR/USD battles monthly rising channel’s support and a clear downside break below the 1.2000 will be enough for bears to re-test 50-day SMA, around 1.1955 by the press time.  

In recent trade today, the People’s Bank of China (PBOC) set the yuan mid-point at 6.4934 vs the estimated 6.4918 and previous 6.4902. About the fix C

In recent trade today, the People’s Bank of China (PBOC) set the yuan mid-point at 6.4934 vs the estimated 6.4918 and previous 6.4902. About the fix China maintains strict control of the yuan’s rate on the mainland. CNY differs from its offshore yuan, or CNH, which is not as tightly controlled as the onshore yuan. Each morning, the People’s Bank of China (PBOC) sets a so-called daily midpoint fix, based on the yuan’s previous day closing level and quotations taken from the inter-bank dealer.    

USD/JPY is trading at 107.92 and flat on a quiet start to the last Asian session of the week. The price is stuck in a 13-pip range. It's been a solid

USD/JPY bears in charge as US dollar fading heads to  50% mean reversion. Eyes will turn to the Fed next week and US yields will be in the picture as will stocks. USD/JPY is trading at 107.92 and flat on a quiet start to the last Asian session of the week. The price is stuck in a 13-pip range.   It's been a solid past few session for the greenback with US yields stabilising from the weekly 10-EMA as well as positive US data ahead of the Federal Reserve next week. In data, the Initial Jobless Claims were low again for the second week in a row providing a clear sign the US economy is improving. There were just 547,000 new claims for benefits, well below expectations.  Meanwhile, the Chicago Fed National Activity Index lifting to 1.71pts from -1.2pts and the Kansas City Fed Manufacturing Activity lifting to 31pts in April from 26pts with the composite index reaching an all-time high. The Fed will be a key event, especially given the recent switch up in tone from both the Canadian and European central banks this week.  Meanwhile, on the domestic from, the Japan preliminary PMIs for April arrived with the Manufacturing at 53.3 (prior 52.7) and Services at 48.3 (prior 48.3) before that, we had the Japan inflation data for March. National headline Consumer Price Index came in as -0.2% YoY (vs. expected -0.2%) Meanwhile, Japan finance minister Aso has said that he is discussing support policies for the upcoming State of Emergency The markets are on alert for the official announcement. The four states at risk are Tokyo, Osaka, and Kyoto
Hyogo. 'Strong measures will be sought to significantly reduce movement. Meanwhile, the Bank of Japan Governor Kuroda speaking is from 0225GMT. USD/JPY technical analysis It's really a US dollar story that is negatively correlated to stocks.  The US stock market was under pressure following news that US president Joe Biden has indicated that he plans to double taxes on capital gains to nearly 40% for the wealthy in order to support those less well off. DXY shot higher as the benchmarks rolled over from below key daily resistance and record highs.  However, USD/JPY is still falling as the US dollar heads towards a 50% mean reversion of the move from overnight: The W-formation is drawing in the bid in the greenback. USD/JPY has subsequently met resistance at a 38.2% Fibo and bears have eyes on a downside extension to prior resistance structure looking left.               

Goldman Sachs cites the Democratic Party’s 'razor-thin majorities in the House and the Senate' to signal challenges for US President Joe Biden’s propo

Goldman Sachs cites the Democratic Party’s 'razor-thin majorities in the House and the Senate' to signal challenges for US President Joe Biden’s proposal of a 40% tax on capital gains earned by the wealthier Americans. The US banker mentions that the proposed tax is unlikely to apply to gains realized before May while also saying, “A 28% rate looks most likely, in our view, as it is roughly halfway between the current rate and Biden's.” “An increase effective January 1 2022 is more likely,” adds Goldman. It’s worth mentioning that Biden’s tax hike proposal drowned markets the previous day while hopes of a lower down version of the risk-negative catalysts join the coronavirus (COVID-19) vaccine optimism to trigger the latest market optimism.

Japan Jibun Bank Manufacturing PMI up to 53.3 in April from previous 52.7

GBP/USD consolidates the heaviest drop in over weeks while picking up bids to 1.3841 during Friday’s Asian session. Even so, the quote remains inside

GBP/USD struggles to find traction inside a 15-pip trading range after declining the most in 12 days.MACD teases bulls, UK Retail Sales for March and preliminary Markit PMIs for April also suggest the pair’s recovery moves.Confluence of 100-HMA and descending trend line from Tuesday becomes the key hurdle.GBP/USD consolidates the heaviest drop in over weeks while picking up bids to 1.3841 during Friday’s Asian session. Even so, the quote remains inside a choppy 15-pip trading range while defending an upward sloping trend line from April 12, not to forget stating the sustained weakness below 200-HMA, ahead of the key UK Retail Sales and Markit PMI data. It should, however, be noted that the upbeat forecast concerning the scheduled British statistics and recovery in the MACD signals seem to back the GBP/USD bulls. As a result, an upside break of 200-HMA level of 1.3846 can escalate the recovery moves toward Wednesday’s low near 1.3885. Though, a convergence of 100-HMA and four-day-old resistance line around 1.3920-25 will be a tough nut to crack for buyers. On the flip side, a clear break below the stated support line, around 1.3833 by the press time, will not hesitate to direct the quote towards 61.8% Fibonacci retracement of April 12-20 upside, close to the 1.3800 threshold. Should GBP/USD sellers dominate past-1.3800, a horizontal line from April 13 around 1.3715 will be important to watch. GBP/USD hourly chart Trend: Further upside expected  

At the time of writing, XAU/USD is trading at $1,783.11 and is consolidating in a $3 range in a quiet start to the last Asian session of the week. Ov

Gold prices meet critical support on the daily chart and key resistance on the hourly.The US dollar stalls at resistance following a strong up day on Thursday. At the time of writing, XAU/USD is trading at $1,783.11 and is consolidating in a $3 range in a quiet start to the last Asian session of the week. Overnight, the commodity complex was pressured and gold prices fell by the same margin as measured by XAU/USD which travelled from a high of $,797.79 to a low of $1,777.28. A strong US dollar early in the European session was the catalyst where most of the leg work by the bears was done before New York came online. However, due to better jobless claims, gold dropped again before a drift higher into the close which was met by a falling stock market capping gains. Initial jobless claims were low again for the second week in a row providing a clear sign the US economy is improving. There were just 547,000 new claims for benefits, well below expectations.  Meanwhile, the stock market doesn’t like the US president’s belief that expenditures can be done on the backs of the wealthiest. Biden has indicated that he plans to double taxes on capital gains to nearly 40% for the wealthy in order to support those less well off. Currently, short-term capital gains are taxed at ordinary tax rates (up to 37%) but long-term gains are taxed at lower rates of up to 20%. Looking forward, next week will be important for not only the Federal Reserve meeting but also the President is expected to release the proposal next week as part of the tax increases to fund social spending in the forthcoming "American Families Plan”. The news was helping to buoy the greenback which has otherwise suffered at the hands of falling yields for the best part of the current month.  Gold technical analysis As per the prior analysis, Bulls looking to test hourly resistance structure, the price has indeed stalled at a 61.8% Fibonacci resistance. Prior analysis, 1-hour chartBulls will need to break the 10-EMA as well as the structure and rise above a 61.8% Fibonacci retracement, or, there is still the probability of a deeper move to the downside and to fully test the bear's commitments at daily support. Live market, 1-hour chart This area may now hold and see the price extend deeper into daily support for the final sessions of the week. However, on a break of resistance, then the daily resistance will be in focus and there will be prospects of a bullish continuation for the week ahead. After all, the daily correction has also met a 61.8% Fibo confluence with prior highs:

USD/CAD attempts recovery from intraday low but fails to go farther from the 1.2500, down 0.05% on a day, amid Friday’s Asian session. In doing so, th

USD/CAD failed to extend the previous day’s corrective pullback despite recent bounce off intraday low.Oil follows geopolitical news, upbeat US data and stimulus hopes to stay mildly bid.Preliminary US Markit PMIs for April will be important but risk catalysts will be the key.USD/CAD attempts recovery from intraday low but fails to go farther from the 1.2500, down 0.05% on a day, amid Friday’s Asian session. In doing so, the Loonie pair defies Thursday’s consolidation of the heaviest losses since June 2020, flashed on Wednesday. While looking for catalysts, WTI’s recovery and the vaccine hopes from Canada seem to play their roles. WTI rises for the second consecutive day, up 0.40% by the press time, as Iran-Iraq tussles join the hopes of more stimulus and faster vaccinations in the West. Ottawa’s jabbing reaches the top-tier lines despite lagging behind the standards of the US, Israel and the UK, as per the COVID-19 vaccine progress data from the Organization for Economic Co-operation and Development (OECD). Faster vaccination is the base for the Bank of Canada’s (BOC) latest positive surprise and hence backs the Canadian dollar (CAD) bulls. Alternatively, the US dollar (DXY) struggles to extend the previous day’s positive performance even as risk-off woes remain present. Global markets turn risk-averse on Thursday as US President Joe Biden proposed a jump in the capital gains tax to fund his upcoming "American Families Plan”. Also challenging the mood could be the covid fears from Asia. Amid these plays, S&P 500 Futures wobbles around 4,130 after Wall Street benchmarks dropped. Looking forward, the US Markit PMIs will be the key as outcomes need to justify upbeat forecasts for April to keep USD/CAD sellers hopeful. It should, however, be noted that the risk catalysts keep the driver’s seat and should be observed closely for fresh impulse. Technical analysis Unless providing a sustained break above 1.2510–2500 horizontal resistance, comprising multiple levels marked since late February, not even short-term USD/CAD buyers may take risk of entries.  

Japan National CPI ex-Fresh Food (YoY) above forecasts (-0.4%) in March: Actual (-0.1%)

Japan National CPI ex Food, Energy (YoY) rose from previous 0.2% to 0.3% in March

GBP/JPY reverses the corrective pullback from the monthly low while dropping back to 149.44 during the early Asian session on Friday. In doing so, the

GBP/JPY remains depressed near monthly low after breaking an ascending trend channel from late February to the downside.Previous month low lures short-term sellers, 50-day SMA adds to the upside barriers.Downward sloping RSI, channel break favor sellers targeting 147.40-30 horizontal area.GBP/JPY reverses the corrective pullback from the monthly low while dropping back to 149.44 during the early Asian session on Friday. In doing so, the quote respects the previous day’s downside break of a two-month-old ascending channel’s support as well as downbeat RSI conditions. It should, however, be noted that the traders await the UK Retail Sales for March and preliminary readings for Markit PMIs for April for impulse. Considering the pair’s inability to defy the bearish breakdown, as well as descending RSI line, GBP/JPY prices look set to challenge March’s low near 148.50 during further weakness. However, a horizontal area comprising late February levels near 147.40-30 will be the key to watch afterward. Meanwhile, corrective pullback beyond the stated channel’s support line becomes the immediate upside hurdle around 149.80 for the GBP/JPY to watch. If at all the recovery moves cross the 149.80 resistance, the 150.00 threshold and 50-day SMA near 150.20 can test short-term buyers. GBP/JPY daily chart Trend: Further downside expected  

Japan National Consumer Price Index (YoY) below expectations (-0.1%) in March: Actual (-0.2%)

As per the prior analysis, Bulls look to target prior support, the price has indeed moved higher from support. Prior analysis, daily chart At this jun

WTI bulls in control to a critical Fibo and ride the dynamic trendline support. Bear's commitments will be tested at this juncture ahead of full upside target. As per the prior analysis, Bulls look to target prior support, the price has indeed moved higher from support. Prior analysis, daily chartAt this juncture, the support would be expected to hold initial tests.Bulls can target the M-formation's neckline in the meantime.However, a bullish extension target can be measured from the correction’s range which brings in a -272% target at 65.30 on the upside. Live market, daily chart Meanwhile, with that being said, should the bears move in for the final sessions of the week, a bearish weekly close that is already on the cards could see additional offers to test weekly support at 61.24 and bring the weekly 10 EMA into focus: Weekly chart  

Wall Street benchmark returned to red on Thursday as US President Biden’s proposal to back the upcoming "American Families Plan” with an increase in c

US equities drop for third day in the week, all three benchmarks print losses around 1.0%.US President Joe Biden proposes 40% capital gain tax on wealthier Americans.Upbeat earnings from Snap, Intel came in near the closing but couldn’t please markets, US data, ECB went largely unnoticed.Wall Street benchmark returned to red on Thursday as US President Biden’s proposal to back the upcoming "American Families Plan” with an increase in capital gains tax to 40%. Also weighing on the mood could be the ECB’s sustained rejection of the taper tantrum and the coronavirus (COVID-19) conditions in Asia, mainly India and Japan. Even as Bide faces strong rejection from Republicans over his $2.25 trillion US infrastructure spending proposal, the Democratic leader matches wide market forecasts of inflating taxes for wealthy Americans to fund his next stimulus. Against this backdrop, Dow Jones Industrial Average (DJI30) and S&P 500 both register the heaviest weekly losses, respectively around 0.94% and 0.92% on a day. Further, Nasdaq 100 also declined 131.84 points, or 0.94% daily, by the end of Thursday’s North American trading session. While the US equity benchmarks dropped on Thursday, the US 10-year Treasury yields also refreshed the weekly low, before recovering some losses to 1.54% of late. Other than the fear tax hike, the European Central Bank’s (ECB) cautious optimism and refrain from following the Bank of Canada’s (BOC) path, at least for now, also weighed on the market sentiment. Further, the covid woes in India and Japan join geopolitical fears concerning China, Russia and Iran to exert additional downside pressure on the risk-off mood. It’s worth mentioning that upbeat prints of US Jobless Claims, Chicago Fed Manufacturing Index and a pullback in Existing Home Sales failed to entertain US traders. Looking forward, the preliminary activity numbers from the UK and Eurozone, coupled with the ECB President Christine Lagarde’s speech will also be the key to watch. However, risk catalysts are likely to keep the driver’s seat and weigh on the mood unless any positive surprises land on the street.

Australia Commonwealth Bank Composite PMI: 58.8 (April) vs 55.5

United Kingdom GfK Consumer Confidence registered at -15, below expectations (-12) in April

Australia Commonwealth Bank Manufacturing PMI up to 59.6 in April from previous 56.8

Australia Commonwealth Bank Services PMI climbed from previous 55.5 to 58.6 in April

Japanese Economy Minister Yasuhisa Nishimura crossed wires, via Kyodo News, while boosting chatters over the return of the coronavirus (COVID-19)-led

Japanese Economy Minister Yasuhisa Nishimura crossed wires, via Kyodo News, while boosting chatters over the return of the coronavirus (COVID-19)-led emergency in the Asian major. “The Japanese government plans to put Tokyo and three western prefectures of Osaka, Kyoto and Hyogo under a state of emergency from Sunday to May 11, covering the country's upcoming string of holidays, in an attempt to curb surging COVID-19 infections with stricter measures,” per the top diplomat. “Businesses serving alcohol will be asked to close. Big sporting events to be held with no spectators present,” added Nishimura. Market reaction... As traders await the official announcement of the news, S&P 500 Futures await fresh clues to extend Wall Street’s losses, backed by US President Joe Biden’s proposal for the capital gains tax hike. That said, USD/JPY remains pressured around 108.00 during the early Friday after refreshing the seven-week low the previous day.

Silver drops back towards $26.00, around $26.10 by the press time, following its failure to consolidate the previous day’s losses during the initial A

Silver fails to recover following the heaviest drop in two weeks.50-day, 100-day SMA restrict immediate downside ahead of monthly ascending trend channel.Bullish MACD signals join upbeat catalysts to suggest recovery moves.A five-week-old upside hurdle will be the key to watch.Silver drops back towards $26.00, around $26.10 by the press time, following its failure to consolidate the previous day’s losses during the initial Asian session on Friday. In doing so, the white metal respects the pullback from a horizontal resistance comprising highs marked on March 18 and April 21. However, 50-day and 100-day SMAs, respectively around $26.00 and $25.90, challenge the commodity’s latest weakness. Also acting as the key downside barrier is the support line of an ascending channel stretched from March 31, near $25.55. It should be noted that the bullish MACD and the aforementioned challenges to the bullion’s downside keep silver buyers hopeful towards another confrontation to the $26.65 crucial resistance. Though, any further upside beyond the multi-day-old horizontal hurdle will be tamed by the upper line of the stated channel formation close to $26.90. Silver daily chart Trend: Further recovery expected  

NZD/USD defends 0.7150, despite fading bounce off three-day low, while taking rounds to 0.7160-65 amid the initial Asian trading session on Friday. Th

NZD/USD remains depressed following the heaviest drop in over two weeks.Chatters over US President Biden’s proposal for higher capital gains drowned risks.Covid, geopolitical headlines also heavy the sentiment, US data, ECB had a little fanfare.New Zealand Credit Card Spending, Aussie PMI will decorate calendar, risk catalyst will be the key.NZD/USD defends 0.7150, despite fading bounce off three-day low, while taking rounds to 0.7160-65 amid the initial Asian trading session on Friday. The kiwi pair dropped the most in 12 days on Thursday as risk aversion roiled market sentiment after US President Joe Biden proposed higher capital gains for wealthier Americans. Investors’ fears weigh on kiwi… Although there were no major announcements from New Zealand the previous day, NZD/USD dropped heavily as risks got sold amid news that US President Biden proposed a 40% capital gain tax for citizens earning over $1.0 million. While the news was widely anticipated for the future its sudden announcement shocked markets even the Democratic Party member suggests the fund’s usage for an upcoming stimulus package that will include free college education and paid family leave.  In addition to the risk-negative news from the US, the coronavirus (COVID-19) woes from India and Japan as well as the Aussie-China and Russia-Ukraine tussles also weighed on the market sentiment. Recently, news that three rockets hit Baghdad’s airport base housing the US troops joined the geopolitical headlines. Amid these plays, Wall Street failed to keep Wednesday’s gain while the US 10-year Treasury yield remains pressured. Further, the US dollar index (DXY) benefited from the risk-off mood. The US dollar gains could also be traced to upbeat prints of US Jobless Claims, Chicago Fed Manufacturing Index and a pullback in Existing Home Sales while the European Central Bank's (ECB) widely anticipated inaction passed unnoticed. While the preliminary readings of Commonwealth Bank’s (CBA) Aussie activity figures for April will be an immediate catalyst for NZD/USD, New Zealand’s Credit Card Sales for March, prior -12.4%, should be watched closely for any recovery. However, risk news will be the key to watch. Technical analysis Despite the latest weakness, NZD/USD is yet to offer a daily closing below the 0.7150-55 support confluence, comprising 50-day and 100-day SMA, which in turn keeps the kiwi pair buyers hopeful.  

AUD/USD fades bounce off the week’s low, flashed a few minutes back, as declining to 0.7703 during the early Friday morning in Asia. The aussie pair r

AUD/USD stays pressured after printing the heaviest losses in 12 days.US President Biden’s proposal for a hike in capital gain tax join Aussie-China tussle covid woes to weigh on sentiment.Upbeat Aussie data couldn’t recall bulls, ECB passed unnoticed.Commonwealth Bank’s Preliminary Activity numbers can offer immediate direction.AUD/USD fades bounce off the week’s low, flashed a few minutes back, as declining to 0.7703 during the early Friday morning in Asia. The aussie pair registered the heaviest daily losses the previous day as risk-off mood superseded welcome economics from the Oz nation and the US as well as the European Central Bank’s (ECB) cautious optimism. Risk catalysts are the key... Fears of US President Joe Biden’s 40% capital gain tax for wealthier Americans dominated the late Thursday moves. In doing so, the traders ignored upbeat prints of US Jobless Claims, Chicago Fed Manufacturing Index and a pullback in Existing Home Sales. Not only from the US but Australia’s welcome prints of National Australia Bank’s Business Confidence for Q1 2021, 17 versus 14 prior and 7 expected, were also forgotten amid fresh fears over the world’s biggest investors. It’s worth mentioning that the ECB widely matched market expectations of announcing no monetary policy change. Further details suggest that the bloc’s central bank remained cautiously optimistic but refrained from discussing taper to its bond purchases. There was no reaction to the ECB though. Other than the US President’s plan to tax wealthier Americans to fund social spending in the forthcoming "American Families Plan”, the coronavirus (COVID-19) spread in Asia, especially in India and Japan, also dragged market sentiment. Further, China’s dislike for Australia’s rejection of the “Belt and Road” deal also adds to the risk-off catalysts. Against this backdrop, Wall Street benchmarks dropped after breaking the curse of two consecutive daily losses during Wednesday. Further, the US 10-year Treasury yields also remained pressured to refresh the weekly low with 1.53%, near 1.54% by the press time. Although risk catalysts are in the driver’s seat, the preliminary readings of Commonwealth Bank’s (CBA) activity figures for April will also be important to follow for fresh directions. Technical analysis The first daily closing below 50-day SMA, around 0.7725 by the press time, in over a week keeps AUD/USD sellers hopeful to revisit the 0.7670 and 0.7620 support levels. Alternatively, an upside break of 0.7725 needs successful clearance of 0.7760-65 hurdle to recall the buyers.  
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