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Key Highlights

• USD/JPY started a sharp decline after it failed to clear 160.80.
• It dived over 500 pips and traded below 156.50 on the 4-hour chart.
• EUR/USD is again moving higher toward the 1.1750 resistance.
• GBP/USD regained traction and rallied above 1.3550.

USD/JPY Technical Analysis

The US Dollar failed to stay above 160.00 against the Japanese Yen. USD/JPY started a major decline below the 158.80 and 158.00 levels.

Looking at the 4-hour chart, the pair traded below a bullish trend line with support at 159.45. There was a close below 158.00, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour).

The pair even spiked below 156.00. A low was formed at 155.53, and the pair is now correcting some losses. On the upside, the pair faces resistance at 157.50.

The first major resistance sits at 158.00. The main resistance could be 158.75. A close above 158.75 could open doors for gains above 159.20 and the 100 simple moving average (red, 4-hour). In the stated case, the bulls could aim for a move to 160.00.

Immediate support is seen near 156.75. The next support could be 156.20. A close below 156.20 might push the pair toward 155.50. Any more losses could initiate a fresh move to 152.00 in the coming days.

Looking at EUR/USD, the pair is attempting a fresh increase and a close above 1.1750 could trigger steady gains.

Upcoming Key Economic Events:

• US ISM Manufacturing Index for April 2026 – Forecast 53.0, versus 52.7 previous.

Japan’s PMI Manufacturing was finalized at 55.1 in April, up sharply from 51.6 in March and marking the strongest reading since January 2022. The data points to a robust rebound in factory activity, with output expanding at the fastest pace in over a year, supported by a surge in sales and increased production momentum.

The strength in activity, however, is being driven in part by precautionary behavior. According to S&P Global Market Intelligence, manufacturers have been boosting inventories amid growing supply chain disruptions linked to the Middle East conflict. Lead times for inputs deteriorated at the fastest rate in 15 years, while input cost inflation surged to a three-and-a-half-year high, highlighting mounting strain across production networks.

As noted by Annabel Fiddes, the current rebound may prove short-lived. “This suggests the current boost to manufacturing could soon fade unless we see reduced market uncertainty and more stable supply chain conditions,” she said, warning that the pickup in activity is tied to stock-building rather than sustained demand. Without an improvement in supply conditions, rising costs and weaker demand could weigh on the sector in the months ahead.

Cost & Supply Chain Indicators

Full Japan PMI manufacturing final release here.

Japan's Tokyo core CPI (excluding fresh food) rose 1.5% yoy in April, below expectations of 1.8% yoy and slowing from 1.7% in March. The reading marks the weakest pace since March 2022, suggesting a temporary cooling in inflation momentum. As a leading indicator of nationwide trends, the data points to softer near-term price pressures than markets had anticipated.

The slowdown was largely driven by government subsidies aimed at curbing utility bills and education costs, which have dampened the headline impact of rising prices. Core-core CPI, which excludes both fresh food and energy, also eased from 2.3% yoy to 1.9% yoy, reinforcing the view that underlying inflation has moderated. Headline CPI edged slightly lower to 1.4% yoy, from 1.5% yoy previously.

However, the softer print may prove temporary. Cost-push pressures linked to the Middle East conflict are expected to feed through into energy and broader consumer prices in the coming months.

Key insights from the week that was.

In Australia, the Q1 CPI report provided the first official estimate of the impact on local prices of the Middle East conflict. Headline inflation accelerated sharply to 1.4% (4.1%yr) in Q1 on the back of a 33% surge in auto fuel prices in March alone. Fortunately, a large portion of this spike has since unwound following the fuel excise cut, although fuel prices remain materially above the pre-conflict level.

While there were some signs of price pressures across home-building, vehicle repair and insurance, it is too early to detect, let alone accurately assess, evidence of pass-through. That said, underlying trimmed mean inflation still rose 0.8% in Q1, with annual growth at 3.5%yr, a full percentage point above the mid-point of the target. Notably, March’s data pre-dates the wide range of price increases reported anecdotally for building products and other items which came into effect in April.

Following the CPI release, Chief Economist Luci Ellis reaffirmed our call for the RBA to increase the cash rate by 25bps to 4.35% at the May policy meeting. The combination of an elevated starting point for inflation and imminent risk of pass-through will compel the RBA to act pre-emptively to contain inflation expectations. Next week’s voting split, updated staff forecasts and the tone of communications will be informative on the baseline policy outlook and risks. For now, we retain our base case of another two hikes beyond May, in June and August, taking the cash rate to a peak of 4.85%.

The combination of higher inflation, slower growth and rising unemployment is also fostering a complex macroeconomic backdrop for the 2026/27 Federal Budget, due May 12. A full preview will be published next week, but our preliminary note sets out our central expectation that commodity price windfalls are likely to more than offset spending pressures and result in a net improvement in the budget’s bottom line over the forward estimates.

Offshore, at the beginning of the week the Bank of Japan held its policy rate at 0.75% in a 6-3 vote. Updated forecasts highlight the risk of stagflation, with FY26 growth revised sharply lower to 0.5% (from 1.5%) and core inflation now expected to remain above 2% through to FY28. With Japanese firms increasingly willing to pass on costs, the Middle East conflict risks amplifying domestic inflationary pressures.

The BoJ remains focused on restoring the policy rate as an effective policy lever. Further hikes were signalled, but the timing left open. With policy settings still considered accommodative and a weak yen threatening import inflation, we anticipate the next hike to occur in June, though there is a risk it is delayed to July. The Financial Statements Statistics update due on 1 June will be an important release to gauge firms’ response to the crisis and the implications for both inflation and activity.

In the US, the FOMC then kept the stance of policy unchanged at its April meeting. The tone of the statement was balanced, with a sanguine view on GDP growth and the labour market and inflation simply characterised as “elevated”. The statement also noted that “the Committee is attentive to the risks to both sides of its dual mandate”, while Chair Powell remarked in the press conference that, in his view, policy is in a good place to take time to monitor conditions, being at the “high end of neutral, perhaps mildly restrictive”. Governors Hammack, Kashkari and Logan also showed greater concern over inflation than the labour market at this meeting, wanting to maintain the target range for the federal funds rate and signal that a hike was as likely as a cut on current information.

The Bank of Canada also kept its policy stance unchanged. The conflict in the Middle East and US trade policy were called out as sources of uncertainty for the global economy. But overall, the outlook for Canada’s economy was viewed as little changed from January. Assuming a protracted resolution to the Middle East conflict into 2027, GDP growth is expected to strengthen through 2027-2028 and inflation to turn back towards the 2%yr target from 3%yr in the near term, allowing the Bank of Canada to remain on hold.

Thereafter in Europe, the ECB Governing Council opted to maintain its current policy stance. The ECB acknowledged that “upside risks to inflation and downside risks to growth have intensified” and the merits of a rate hike were discussed, but developments to date were not sufficient to convince the Governing Council to take immediate action – the decision to hold was unanimous. At its previous meeting in March, the ECB presented two downside scenarios alongside its baseline. In the April press conference, President Lagarde was reluctant to discuss the details of those scenarios, noting simply that conditions are diverging from March’s baseline and the upcoming six weeks “will be the right time” to assess the economy “in order to make an informed decision”. Her comments appeared carefully chosen to signal openness to a rate increase in June. Therefore, barring any major changes in the dynamics of the Middle East conflict, we continue to believe that a 25bp policy rate hike is the most probable outcome at the next meeting.

The Bank of England’s April meeting also unfolded broadly as expected, the MPC voting 8-1 to keep the policy rate at 3.75%. Chief Economist Hew Pill was the sole dissenter, preferring “a prompt but modest hike in Bank Rate” to contain the risk of second-round inflationary effects. The policy statement maintained a hawkish bias, however, emphasising the potential impact of the energy price shock – its scale and duration – on UK inflation and the committee’s readiness to act to ensure inflation returns to the 2% target. Policy makers also showed concern over economic growth and the labour market, with slack increasing prior to the conflict.

Risks to the economic outlook were illustrated using three alternative scenarios, differentiated by oil and gas price assumptions and the persistence of second-round inflation effects. In the first two scenarios, the Brent oil price averages $108 in Q2 2026 then decreases at different speeds. Both scenarios showed headline inflation peaking above 3.5%yr this year before easing in 2027. Importantly, the Governor emphasised that, if the economy evolves in line with these scenarios, further policy tightening may not be required – the removal of the circa 50bp of easing priced before the conflict potentially sufficient to bring inflation back to the 2% target. The committee judged that the most severe scenario – where Brent averages $127 this quarter and remains above $100 well into 2028 – would likely require “a forceful tightening in monetary policy”, however. The Governor declined to specify what interest rate changes this would entail, but noted the need to act quickly to minimise second-round effects. Bank Rate hikes this year are therefore not guaranteed, but with Brent Oil surging as much as 20% this week to a peak around USD126 (now USD114) as the US and Iran remained at an impasse, conditions may eventually become too close to the BoE’s most severe scenario for the MPC to ignore. We continue to expect a Bank Rate hike at the next policy meeting in June, with further tightening possible, but dependent on evolving circumstances.

• Silver and Gold are bouncing higher again after the Federal Reserve and other Central bank meetings
• With Oil and the US Dollar stumbling on the session, Metals and other risk assets are shining bright
• Intraday timeframe analysis for XAG/USD and XAU/USD

Silver and Gold are bouncing higher in today's session, with the bid taking traction in the wake of the Federal Reserve and a barrage of other global central bank meetings; With both Crude Oil and the US Dollar stumbling during today's session, precious metals and broader risk assets are shining bright again.

For weeks if not months, metals have been trapped in a truly bizarre, choppy range.

Despite numerous attempts, bulls have been completely unable to gather sustained upside momentum – This came along with a lack of real safe-haven demand, and the questioning on whether metals are still valuable at current valuations for flights towards quality.

Yet, every sharp pullback has seen sharp response, preventing any clear technical downtrend.

This erratic, sideways price action points to deep, fundamental confusion among institutional investors.

Gold vs WTI Crude Inverse Correlation – Source: TradingView. April 30, 2026

This widespread Market confusion is quite logical.

The macroeconomic and geopolitical backdrop remains both uncertain and chaotic.

High-stakes US-Iran diplomatic talks are completely stuck in the mud, with President Trump explicitly indicating that he does not mind maintaining the aggressive maritime blockade indefinitely to keep a relentless chokehold on the Iranian economy – Israel and Pakistan are also sending their own conflicting reports.

Meanwhile, global central banks remain highly reluctant to change their defensive policy stances amid this unpredictable environment.

As long as Crude Oil remains structurally elevated (above $80), precious metals—which are highly sensitive to the threat of stickier, energy-driven inflation and the resulting higher for longer rate pricing—will continue to face overhead pressure.

However, it will be incredibly interesting to see how these assets react if the Middle East conflict actually reaches a proper diplomatic resolution.

For now, the intraday rallies in Gold and Silver are almost entirely explicable on the broad-based drop in the US Dollar. If this Greenback weakness gains further structural traction, particularly if the conflict resolves, a clean, aggressive rally could easily follow.

Bulls should have their eyes firmly set on some upside targets for longer-run breakouts, looking at the $4,900 level for Gold and $84 for Silver.

Let's explore the recent shifts in an intraday timeframe analysis of Gold (XAU/USD) and Silver (XAG/USD) to identify where are the key levels to watch for breakouts.

Gold (XAU/USD) 4H Chart and levels

Gold (XAU/USD) 4H Chart, April 30, 2026 – Source: TradingView

After bouncing from its $4,500 Support (near the 2025 December record), the price action is much less bearish but also not so bullish yet. This confirms with the neutral RSI.

In such price action, it is favorable for traders to let prices form the trades:

• For bulls, wait for an extension above $4,700, breaking above the 50 and 200 Moving Averages (stop orders could be valid)
• Bears will want to see a reversal around current levels or rejecting the 50 MA ($4,685) with further acceleration below $4,485 (wait for a rejection of the MA before entering)

Intraday Timeframe Levels to watch for Gold (XAU/USD):

Resistance Levels:

• $4,685 - 4,700 4H 50 & 200 MA
• $4,850 to $4,900 Major Resistance (bullish above)
• $5,100 Pivotal Resistance
• $5,400 mini-resistance

Support Levels:

• December 2025 Support $4,500 to $4,550 (bearish below)
• Pivotal Support $4,325 – $4,400
• Main Channel Lows Support $4,100
• Next Support $3,880 to $4,000

Silver (XAG/USD) 4H Chart and levels

Silver (XAG/USD) 4H Chart, April 30, 2026 – Source: TradingView

Silver bulls have found strong support just above $70 and are testing the upper bound of the bear-channel.

Not far above, the action will meet the 4H 200-period MA ($74.80).

• Extending above should relaunch odds of a continued bounce towards $84.
  • Above $84, the action is back to in much more bullish territory.
• Rejecting between here and the 200-MA (~$74), bears will regain the upper hand and add to their chances to create a more meaningful correction in the metal.
  • Breaking $61 should see heavy continuation to the downside.

Higher Timeframe Levels to watch for Silver (XAG/USD):

Resistance Levels:

• Pivot lows $74.50 - $75 (4H 200-period MA – bullish above)
• Pivot highs $79 - $79.50
• $84 Major level
• Key Range Resistance $90 to $92
• $96.47 March highs (higher odds of All-time highs if break above)
• Current Record $121.67

Support Levels:

• $70 - $72 Minor Support (recent bounce – Bearish below)
• December FOMC Minor Support $64 to $66
• $61.10 Past Session lows
• $50 to $55 October Resistance now Major Support
• Silver's 2011 All-time highs $49.81

Safe Trades and good luck for next month!

Japanese yen surged across the board on Tuesday, gaining around 3% vs its major counterparts, in the biggest daily gain since late 2022.

The rally was sparked by comments from Japan’s FinMin who said that timing to take decisive action in the market was nearing, while some reports, citing government and the central bank, said that Japanese authorities intervened today to support yen, which hit the lowest levels since mid-2024, when the last intervention have occurred.

Today’s action follows the recent narrative that signaled readiness of authorities to intervene when USDJPY breaks resistance at 160 zone

Fresh acceleration hit the levels last traded in late February and marked retracement of near 61.8% of 152.39/160.72 rally, with significant bearish signal seen on surge through ascending and thickening daily Ichimoku cloud (spanned between 157.59 and 155.99).

Daily technical studies weakened after today’s action (steep falling momentum broke into negative territory / MAs turned mainly to bearish setup) although close below daily cloud will be required to signal that bears gained full control.

In such scenario, break of 155.50 (Fibo 61.8%) would expose targets at 153.97 (200DMA) and 153.61 (trendline support).

Near term bias, however, is expected to remain with bears while the price stays within the cloud (top lays at 157.59).

Res: 157.24; 157.59; 158.09; 158.72
Sup: 156.50; 155.99; 155.50; 154.26

• The ECB held policy rates unchanged as widely expected with the deposit rate at 2.00% on Thursday 30 April.
• Lagarde refrained from giving firm guidance of the future rate path and stated that the ECB will have more information in June to take a decision, including new projections and scenarios. By extension, the market reaction was highly contained.
• We continue to expect the ECB to increase policy rates by 25bp in June and July, respectively.

The ECB decided to keep the three key policy rates unchanged at the April meeting as widely expected by both consensus and markets, keeping the deposit rate at 2.00%. The ECB stated that both the upside risks to inflation and downside risks to growth have intensified. Yet, the GC remains “well positioned” to navigate the uncertainty and they asses long-term inflation expectations are “well anchored”. ECB highlights that the implications of the Iran war depend on the intensity and duration, so they are not drawing firm conclusions yet but remain in “wait and see” mode.

During the press conference Lagarde refrained from giving firm guidance on the future path of interest rates. She highlighted the deteriorating growth prospects and that she was “certainly not seeing second-round effects”. Lagarde noted that it was a unanimous decision within the GC to keep rates unchanged, but they debated various options including a rate hike, which was a view held by some members of the GC. The ECB will have more information in June where their staff both updates the baseline projections and the economic scenarios. Until then, the ECB is faced with an “ocean of uncertainty”. As a consequence, the market reaction was highly contained with European rates remaining in a tight range, ending the press conference 1-2bp lower with EUR/USD breaking slightly below the 1.17 mark.

Lagarde stressed that the economy is clearly moving away from the baseline scenario, which aligns with our thinking. Inflation in April rose as expected to 3.0% y/y, similar to the ECB’s March baseline forecast but the outlook is closer to the “adverse” scenario when looking at market pricing (see chart) and seller price expectations rose significantly in the EC’s survey. At the same time Q1 GDP growth was weaker than expected and both consumer confidence, services PMIs, and employment expectations took large hits in April. Since ECB must balance higher inflation with lower growth, we expect two hikes is enough to keep inflation expectations anchored. We therefore keep our call of expecting the ECB to hike policy rates by 25 bp in June and July, bringing the deposit rate to 2.50%. We see risks to the call as tilted to the downside.

• The Bank of England on hold, as widely expected.
• A scenario framework was presented and suggests rate hikes would be the appropriate response, but the governor was very careful not to pre-commit to anything.
• We think that the most likely outcome going forward is no changes, but recognise risk is tilted towards one or two hikes.

The Bank of England (BoE) kept the Bank Rate unchanged at 3.75% as expected. The decision was taken with an 8-1 vote, with Chief Economist Pill voting for a hike. The BoE presented three scenarios in their monetary policy report, of which scenario A looks outdated, because energy prices are conditioned on mid-April futures curves.

Scenario A assumes the energy shock is short lived, while scenario B and C means more persistent costs and higher inflation in particularly scenario C, see BoE: Monetary Policy Report for details. Noticeably, none of the scenarios pencil in an outright recession. Different BoE models largely put appropriate policy responses of one/two/several hikes in the three different scenarios. Governor Bailey is putting most weight on scenario B along a small majority in the MPC which could quickly find itself split in the middle again. In the press conference, Baily was very careful not to attach any probabilities or specific policy responses to the scenarios, though. He noticed, however, that he does not think market pricing is off, so no push back on that front.

He emphasized that the decision was an "active hold" and not a "wait-and-see" decision. The BoE will not wait for second round effects to react, because by then, it is too late. Over the coming weeks, they will be particularly zoomed in on food prices, which have a large energy component. Pay settlement is set in the spring and is thus not likely to compensate consumers for lost purchasing power anytime soon.

BoE call. The meeting today and the balance of the MPC-members' individual statements did not convince us, that the BoE is on the brink of hiking rates. We think they are satisfied with the tighter financial conditions and are most likely to keep the Bank Rate at the current level, but we recognise the risk is tilted towards one or two hikes. Much hinges on the situation in the Gulf and the balance between UK activity and signs energy costs are spreading to core inflation.

Market reaction. The market responded to the decision by trading Gilt yields lower and backtracking a bit on the hawkish repricing. The June meeting is now priced close to 50-50 for a rate hike.

• Nonfarm payrolls enter spotlight after hawkish Fed.
• RBA prepares for its third straight interest rate hike.
• Canada employment report comes out alongside the NFP.
• Switzerland CPI and New Zealand jobs data also on tap.

Middle East tensions lift the Dollar and yields

The US dollar staged a recovery against its major peers this week, despite the ceasefire in the Middle East remaining in effect. The week began with a fresh wave of optimism as news hit the wires about Iran offering the US a proposal to end the conflict in the Middle East. However, the cheering was short-lived as, according to a US official, President Trump was unhappy with the proposition and remained willing to extend the blockade

This pushed the US dollar and Treasury yields higher as anxiety about the Strait of Hormuz remaining closed for longer intensified. Fears that this could lead to even stickier inflation down the road prompted market participants to scale back their rate cut bets, with Wednesday’s Fed decision putting to bed any dim hopes about a potential reduction towards the end of the year.

The Fed decided to refrain from pressing the rate-cut button, citing still-too-high inflation. The decision was very divided, with one member voting for a rate cut at this gathering, but three others voting to remove or delay any signals of future rate cuts. This prompted investors to get their rate cut bets off the table and even pencil in a more-than-50% chance of a rate hike by April 2027.

Nonfarm payrolls to reshape Fed rate speculation

With the next meeting scheduled for June, and most probably the first under Kevin Warsh’s lead, investors could turn the spotlight on Friday’s NFP data as they try to gauge how the Fed may proceed from here onwards. The ADP report on the private employment sector will be released on Wednesday.

Nonfarm payrolls rebounded strongly in March, rising 178k after shrinking 92k in February, while the unemployment rate ticked down to 4.3% from 4.4% and average hourly earnings slowed to 3.5% y/y from 3.8%. Another month of solid job gains, accompanied by accelerating wage growth, which could intensify inflation concerns, could add further credence to the idea that the Fed does not need to further lower interest rates this year.

The 4-week moving average of the ADP weekly employment change has increased notably in April compared to previous months, corroborating the notion that, at least, the private sector has enjoyed strong jobs growth, tilting the risk to the ADP monthly print and, thereby, Friday’s NFP to the upside.

RBA set to hike again, will it maintain a hawkish stance?

Following last week’s central bank barrage, on Tuesday, the torch will be passed to the Reserve Bank of Australia. At its latest gathering, on March 17, the Bank proceeded with its second consecutive quarter-point hike, citing elevated inflation and stronger-than-expected economic growth.

However, the decision was a close call, with 5 members voting in favor of a hike and 4 voting to hold. This makes next week’s decision even more interesting, despite market participants assigning a strong 75% chance that officials will pull the hiking trigger for a third straight time.

The reason for that may be the further acceleration in inflation, with all metrics moving further beyond the upper bound of the RBA’s 2-3% target range. In March, the headline CPI skyrocketed to 4.6% y/y from 3.7% in February, with the trimmed mean CPI remaining unchanged at 3.3%; and this with the job market remaining on a growth trajectory, adding 18k jobs in March and allowing the unemployment rate to rest at 4.3%.

A rate hike on its own is unlikely to shake the aussie much. Traders may need to see more members joining the hiking camp and receive stronger signals that the Bank remains willing to take interest rates higher if oil prices continue to pose a threat to inflation.

Canada and NZ jobs reports, Swiss CPI also in focus

Flying to Canada, the nation’s employment report will be released at the same time as the US jobs data. The Bank of Canada also held its monetary policy decision on Wednesday. Officials decided to keep the policy rate untouched and although they acknowledged inflation is still above their objective, they regarded it as temporary pressure from oil prices. Therefore, even if the Canadian report comes in strong, a less hawkish message from the BoC compared to the Fed is unlikely to allow the loonie to outperform the US dollar.

Elsewhere, Switzerland’s CPI will be released on Tuesday, where a further uptick driven by the Middle East-related energy crisis could reduce pressure for the SNB to adopt negative rates and may also delay a potential intervention in the FX market. That said, despite the latest dollar gains, the franc remains extremely strong, and should it resume its prevailing uptrend, deflation concerns may resurface and the SNB could remain vigilant and willing to step into the FX market should it be deemed necessary.

New Zealand’s employment report is also on Tuesday’s agenda, but later in the day, during the early Asian session. Although the RBNZ signaled a “wait and see” stance at its April gathering, the stubbornly high oil prices have prompted investors to pencil in a 35% chance of a quarter-point hike at the May decision and a strong jobs report could take that percentage higher, thereby boosting the kiwi.