FX News Today
- China misses manufacturing PMIs moving Asian stock markets lower, Japan remains closed all week. The disappointing manufacturing PMI readings out of China, which signalled a deceleration in the pace of expansion in both private and official readings. The official reading fell back to just 50.1 from 50.4.
- French Q1 GDP growth held steady at 0.3% q/q, in line with consensus expectations and bringing the annual rate to 1.1% y/y from 1.0% y/y in the previous quarter.
- YEN: has been underpinned by continued safe haven demand and growth concerns in Asia compounded by the weak Chinese data. USDJPY moved down to test 111.50 overnight.
- USOil remains under $63.50 and weighed by Fridays fall, GOLD pivots around $1280 but is capped at 1285
- Earnings reports from Alphabet disappointed. Overnight, US markets closed up but Futures are down again this morning.
Charts of the Day
Technician’s Corner
- USDJPY fell again to test 111.50 and the S1 daily support at 111.48. USDJPY has tried, and failed to hold the 112 mark for several weeks now, and may be entering a phase of shaking out some long positions, before being able to make fresh gains. Overall, risk sentiment will be a determining factor going forward, though with the BoJ on hold, and a chance for further easing ahead, USDJPY can be expected to eventually head higher. 112.00 remains key resistance with the 200-day sma at 111.15.
- EURUSD made its way to four-session highs of 1.1184 after the London close, up from early lows of 1.1146. The core PCE price data released earlier was cooler than expected, which helped the Euro post modest gains. While the pairing is well up on Friday’s trend low, further gains will likely be tentative into Today’s preliminary CPI figures from the major EU countries and trades at 111.80, currently. Given ongoing softness in EU data, and an ECB likely to be lower for longer, EURUSD remains pressured. The next downside level remains at the 1.1100 zone.
Main Macro Events Today
- CAD Gross Domestic Product (CAD – 12:30) – The economy’s most important figure, m/m GDP, is expected to rise 0.3%
- German CPI & EUR Flash GDP (EUR – 10:00) – German regional Inflation and Eurozone GDP are both expected to creep up a tick to 0.5% and 0.3% from 0.4% and 0.2% respectively, nothing in the numbers is expected to alert the ECB’s position on a sluggish EZ area.
- Consumer Board Consumer Confidence (USD-15:00) – Expectations are for a bounce to 126.2 in April from 124.1 in March.
Support and Resistance
Stuart Cowell
Head Market Analyst
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