Sample Category Title

Daily Pivots: (S1) 0.8580; (P) 0.8602; (R1) 0.8626; More...

EUR/GBP is staying in consolidation below 0.8737 short term top and intraday bias remains neutral. Further rise is expected as long as 0.8518 support holds. On the upside, break of 0.8737 will resume the larger rally from 0.8221. However, sustained break of 0.8518 will bring deeper fall back to 55 D EMA (now at 0.8438).

In the bigger picture, down trend from 0.9267 (2022 high) should have completed at 0.8221, just ahead of 0.9201 key support (2024 low). Rise from 0.8221 is likely reversing the whole fall. Further rise should be seen to 61.8% retracement of 0.9267 to 0.8221 at 0.8867 next. This will now remain the favored case as long as 0.8472 resistance turned support holds.

Daily Pivots: (S1) 1.7870; (P) 1.7943; (R1) 1.8017; More...

Intraday bias in EUR/AUD remains neutral as consolidations continue below 1.8554 short term top. Downside of the pull back should be contained by 38.2% retracement of 1.5963 to 1.8854 at 1.7750. On the upside, firm break of 1.8554 will resume larger up trend.

In the bigger picture, up trend from 1.4281 (2022 low) is in progress, and in reacceleration phase as seen in W MACD. Next target is 100% projection of 1.4281 to 1.7062 from 1.5963 at 1.8744. Firm break there will pave the way to 138.2% projection at 1.9806, which is close to 1.9799 (2020 high). Outlook will remain bullish as long as 1.7417 resistance turned support holds even in case of deep pullback.

Daily Pivots: (S1) 161.62; (P) 162.15; (R1) 162.70; More...

Intraday bias in EUR/JPY remains neutral as range trading continues. On the upside, above 164.16 will resume the rally from 154.77 to 164.89 resistance, and then 166.67. However, decisive break of 158.27 support will bring deeper decline back to 154.77 support. Overall, sideway consolidation pattern from 154.40 is still extending.

In the bigger picture, price actions from 175.41 are seen as correction to rally from 114.42 (2020 low). Strong support should be seen from 38.2% retracement of 114.42 to 175.41 at 152.11 to contain downside. However, sustained break of 152.11 will bring deeper fall even still as a correction.

Daily Pivots: (S1) 188.04; (P) 188.45; (R1) 188.88; More...

Intraday bias in GBP/JPY remains neutral as range trading continues above 184.35. Risk will remain on the downside as long as 190.06 resistance holds. Below 184.35 will target 180.00 low. Nevertheless, break of 190.06 will turn bias back to the upside for stronger rebound.

In the bigger picture, price actions from 208.09 are seen as a correction to rally from 123.94 (2020 low). Strong support should be seen from 38.2% retracement of 123.94 to 208.09 at 175.94 to contain downside. However, sustained break of 175.94 will bring deeper fall even still as a correction.

Markets

After the market chaos in the wake of the Liberation Day reciprocal tariffs announcement, president Trump and his administration now apparently (again) started a new battlefield challenging classic economic thinking/wisdom: central bank independence. Referring to the ECB rate cuts, president Trump on Thursday already indicated that Jerome Powell and the Fed are again too late and wrong not to have already cut interest rates. He reinforced that call on Monday morning as Trump assessed that there is virtually no inflation anymore in the US. At the same time, there are all kinds of rumours/headlines (including from Kevin Hassett, director of the National Economic Council) that the administration continues studying the matter of the President being able to dismiss the Fed Chair. This intensifying debate on central bank independence yesterday added a new layer of uncertainty for US markets. The US Treasury curve again steepened, with the 2-y ceding 3.6 bps. Markets apparently assume that the Fed at some point will (have to) give in to political pressure even as Fed Chair Powell last week indicated that, considering current status of the economy/labour market, the Fed still is well positioned to maintain its current wait-and-see stance, giving priority to price stability. However, the sell US trade again hit the long end of the US yield curve hard with the 30-y yield adding 10.4 bps. At 4.90%, the psychological barrier of 5.00% (often seen as a line in the sand for outright market panic) is again within reach. European (equity) markets still were closed for the Easter Long Week, but US equities again were hit hard as the cornerstone of Fed independence was seen as coming further under pressure. US equity indices declined about 2.5%. The dollar also was again in free-fall. DXY dropped below the 99.57/98.98 key support area, trading at the lowest level since end March 2022. Similar narrative for EUR/USD with the pair breaking beyond the 1.1495 February 2022 top. USD/JPY this morning is testing the 140 barrier!

This morning, Asia markets showed no clear trend after the US sell-off yesterday. European markets reopen after the long Easter weekend. A balanced ECB communication at Thursday’s policy meeting and Bunds recently profiting from safe have flows, potentially keep European bond markets well supported short-term. The eco calendar is thin today, but several Fed and ECB speakers will give their view. The US Treasury will sell $69 bln of 2-y notes, but the focus of markets evidently is at the long and of the curve. Yesterday’s breaks in several key USD cross rates including EUR/USD suggest a further slide of the US currency. The 30-y US yield nearing the 5.0% barrier only might add to further US(D) related nervousness.

News & Views

China’s Ministry of Commerce yesterday published a statement warning countries against (trade) deals with the US at the expense of China’s interests. In such scenario, Beijing ““will never accept it and will resolutely take reciprocal countermeasures. China is willing to strengthen solidarity and coordination with all parties, jointly respond and resist unilateral bullying acts.” Part of the US government’s tactics to get rid of currently paused additional tariffs include pushing other countries to curb trade with China. Sources suggest this could include imposing secondary tariffs on countries with close China ties. The US also wants them to stop absorbing excess goods from China that are being rerouted in order to escape the very high US duties. Reuters reported earlier this month that Vietnam for example is prepared to crack down on Chinese goods being shipped to the US via its territory and to tighten controls on sensitive exports to China.

Rating agency S&P raised the Greek credit rating to BBB with a stable outlook. They praised efforts to improve tax compliance, combined with resilient economic growth, which are enabling Greece to continue overperforming fiscal targets. The net debt to GDP ratio is expected to fall by an average of 6 percentage points over the next four years (to 114% in 2028). Finally, the country’s debt management agency has a significant cash position estimated at 15% of GDP which covers close to three years of upcoming debt maturities.

The Dollar Index (DXY) has experienced a significant decline since President Trump’s tariff war intensified global trade tensions. From its peak on September 26, 2022, the Index has exhibited a clear bearish sequence. This decline aligns with an Elliott Wave structure, offering insights into potential future price action.

The current bearish sequence is unfolding as a corrective zigzag pattern, labeled ((A))-((B))-((C)). Waves ((A)) and ((B)) have completed, and the Index is now in the ((C)) leg. Wave ((C)) leg subdivides into a strong five-wave impulse to the downside. Based on Fibonacci extensions, the projected target for this decline lies between 85.5 and 94.9. This corresponds to the 100% – 161.8% Fibonacci extension levels from the prior structure. This zone represents a critical support area where buyers may attempt to step in.

In the shorter cycle, the DXY is expected to face resistance in a 3, 7, or 11-swing corrective rally. As long as the pivot at 103.5 holds, the bearish momentum should persist, driving the index toward the Fibonacci target zone. Traders should monitor these levels closely, as a break above 103.5 could invalidate the immediate bearish setup, while continued failures at resistance reinforce the downside bias.

This Elliott Wave outlook suggests the DXY remains vulnerable, with the tariff war’s ripple effects continuing to pressure the dollar. Stay vigilant for price action near the 85.5 – 94.9 range for potential reversal signals.

Dollar Index (DXY) 60 Minute Elliott Wave Chart

DXY Video

https://www.youtube.com/watch?v=z-ICC6hxQJk

US stocks slumped. All four major US stock indices ended Monday, 21 April session, deeply in the red. The S&P 500, Nasdaq 100, Dow Jones Industrial Average, and Russell 2000 lost 2% or more.

The 'US exceptionalism' narrative is under threat as US equities, the dollar, and Treasuries are being sold off simultaneously. Notably, over the past four weeks, the dollar and Treasuries have failed to act as traditional safe havens during periods of risk-off sentiment, instead behaving more like emerging market assets.

The current rout seen in the US dollar has wiped out all of last year’s gains seen in the US Dollar Index. The US dollar tanked to a 10-year low against the Swiss franc yesterday, and the euro climbed to an intraday high of 1.1573 against the US dollar, its highest level since November 2021.

The continuation of US President Trump’s threats to remove Fed Chair Powell and the growth uncertainties arising from US trade tariffs, coupled with retaliation measures, have benefited Gold.

Gold (XAU/USD) surged to another fresh record yesterday with a gain of 2.9%. In today’s Asia opening session, it extended its rally by 0.7% and printed a new intraday all-time high of US$3,453 at this time of writing.

Reuters, according to a source, reported that the Bank of Japan (BoJ) is likely to keep its interest rate hike signal intact despite Trump tariff risks after the conclusion of its upcoming two-day monetary policy decision meeting, ending 1 May.

In addition, the source, as quoted by Reuters, stated that BOJ is likely to downgrade Japan's current fiscal 2025 economic growth forecast of 1.1% in its updated quarterly report release on 1 May.

After the conclusion of the first round of US-Japan trade talks last week, Japanese Prime Minister Ishiba told parliament yesterday, 21 April, that Japan will not concede to all US demands, citing the need to protect national interests, especially in the automobile and agricultural sectors.

Hence, the second round of trade negotiation talks between the US and Japan to be held before the end of April may not be smooth sailing.

After the sell-off seen in major US stock indices yesterday that led to short-term oversold conditions on several technical momentum indicators, the S&P 500 and Nasdaq 100 E-mini futures have managed to stage a relief corrective rebound of 0.7% each in today’s Asian opening session at this time of the writing.

The Hong Kong stock market reopened after a two-day Easter break, playing catch-up to global weakness. The Hang Seng Index is down 0.7% intraday.

Economic data releases

Fig 1: Key data for today’s Asian mid-session (Source: MarketPulse)

Chart of the day – Hong Kong 33 at risk of further downside to retest 200-day MA

Fig 2: Hong Kong 33 CFD Index minor trend as of 22 Apr 2025 (Source: Trading View)

Since its recent minor swing high of 21,668 printed on 14 April, the short-term technical conditions of the Hong Kong 33 CFD Index (a proxy of the Hang Seng Index futures) have deteriorated.

The latest observations seen on its hourly RSI momentum indicator have just flashed out a bearish momentum condition at this time of writing below the 50 level.

All in all, the Hong Kong 33 CFD Index may see a multi-day decline to retest its 200-day moving average. Watch the 21,450 key short-term pivotal resistance, and a break below 20,840 near-term support may expose the next intermediate supports at 20,280 and 19,900 (200-day moving average).

On the other hand, a clearance above 21,450 invalidates the bearish tone to see a squeeze up for the next intermediate resistances to come in at 21,740 and 22,220/22,500 (also the area between the 20-day, and 50-day moving averages).

In focus today

Today will be light on the macro front, with markets continuing to closely watch trade uncertainty and any signals from Trump.

In the euro area, focus turns to the consumer confidence indicator for April. Consumer confidence has declined in the past months following a great rebound last year, and the trade war uncertainty in April has likely amplified the development.

In Sweden, the latest unemployment figures will be released today at 8:00 CET. The concerning trend observed in recent months may persist due to significant uncertainties faced by companies, which likely suppress their willingness to hire. Although we anticipate a decline in unemployment towards the end of the year, it may take a few more months to be certain that we have surpassed the peak levels.

For the remainder of the week, the most important data releases are the PMI reports for April, scheduled for release on Wednesday. As the surveys were conducted after Liberation Day, the figures are likely to provide a first glimpse of the impact from tariff uncertainty. Importantly, any progress in the tariff saga - particularly in US-China trade negotiations - and shifts in global investor sentiment will continue to influence markets this week.

Economic and market news

What happened during Easter

In the US, retail sales growth in March (ahead of Liberation Day) remained solid, printing close to expectations at 1.4% (cons: 1.3%, prior: 0.2%). Lower gasoline prices dragged on the headline, while car sales edged up. While tariff concerns likely impacted some categories, sales growth in bars and restaurants — often a good measure of discretionary spending and not affected by tariffs — gained some momentum from February. Overall, the release suggests that the very gloomy consumer sentiment readings have yet to translate into hard data as negatively as some had feared.

The Philly Fed's manufacturing index weakened markedly in April, with new orders slumping to -34.2 from 8.7 in March. Hence, there are signs that PMIs for April will deteriorate in the first reading after Liberation Day.

During Easter, several Fed speakers were on the wire. Fed Chair Powell (hawk and voting member) emphasized that the Fed remains in a wait-and-see mode. Similarly, NY Fed President Williams (hawk and voting member) said that he does not see an imminent need for a change in monetary policy. Chicago Fed President Goolsbee (neutral and voting member) stated that he hopes the US is not moving toward an environment where the Fed's monetary policy independence is questioned, following Trump's recent attacks on Powell. Considering the upcoming week for the Fed, focus will naturally be on Trump's outbursts toward Powell, but attention will also be on several Fed officials scheduled to speak before the blackout period begins on Saturday.

In the euro area, the ECB cut policy rates by 25bp, bringing the deposit rate to 2.25%, as widely anticipated. Overall, the meeting was in line with our expectations, with the ECB conveying a dovish tone - noting the downside risks to growth, while downplaying the topside risks to inflation. Markets reacted by sending European yields lower on the statement, with further declines during the press conference. EUR/USD moved initially lower, but the weak Philly Fed reading provided some support for the cross. Looking ahead, we continue to expect the ECB to deliver 25bp cuts at the upcoming meetings, bringing the deposit rate to 1.50% by September 2025. We currently see downside risks to growth, inflation and rates in the medium term. For more detail on our assessment of the ECB meeting, please see ECB review - Dovish bias in troubled waters, 17 April.

In China, the 1Y loan prime rate and the 5Y loan prime rate were held unchanged at 3.10% and 3.60%, respectively.

Turning to politics, China has accused the US of abusing tariffs and warned other countries against striking deals with the US at China's expense. The remarks come after a Bloomberg article, citing sources familiar with the matter, reported that the Trump administration is preparing to pressure nations seeking tariff reductions or exemptions from the US to curb trade with China - including through the imposition of monetary sanctions. For more detail on how we currently see China's footing in the trade war, please see Postcard from China - 10 key takeaways from trip to China, 16 April.

In the UK, March inflation was lower than expected across the board, with headline at 2.6% y/y (cons: 2.7%, prior: 2.8%), core at 3.4% (cons: 3.4%, prior: 3.5%) and services at 4.7% (cons: 4.8%, prior: 5.0%). The largest downward contribution came from recreation and culture and transport, while clothing provided the largest upward contribution. The monthly momentum eased in services and in core services, which is the key measure for the BoE. With UK inflation surprising to the downside over the past months we think the BoE is set to continue easing, delivering its next 25bp cut at the upcoming meeting in May.

In Denmark, Danmarks Nationalbank followed the ECB, cutting its key policy rate 25bp to 1.85%.

In Canada, the BoC held its policy rate at 2.75%, as expected by markets. The BoC emphasized that monetary policy cannot fix trade uncertainty and reaffirmed its 2% inflation target. The MPR included two scenarios: one with normal trade, showing modest growth and steady inflation, and another with a prolonged trade war, forecasting recession and inflation above 3% next year. The neutral rate estimate was kept unchanged at 2.25-3.25%. Markets now lean toward a June cut, suggesting the BoC is pausing, not ending, its easing cycle amid tariff-related uncertainty.

In Japan, the nationwide inflation report for March, saw core CPI rise 3.2% y/y from 3.0%, in line with expectations. Excluding fresh food and fuel costs, the index increased 2.9% y/y from 2.0%. Governor Ueda was on the wire, reiterating that the BoJ will continue to raise interest rates if underlying inflation pressures continue to accelerate toward 2%. That said, Ueda also signalled a naturally cautious and flexible approach amid the uncertainty stemming from Trump's potential tariffs. We continue to expect the BoJ to normalize policy further, delivering additional rate hikes this year.

In Turkey, the CBT surprised markets hiking its policy rate by 350bp to 46%.

In commodities space, easing supply concerns tied to potential progress in US-Iran nuclear talks pushed oil prices down over 2% during yesterday's session. As of this morning brent is trading around 67 USD/bbl.

Gold prices continued its record high rally this morning, hovering around USD3488 per troy, driven by investors seeking safe-haven assets.

Equities: Looking at equity markets over Easter - a period with more public holidays in Europe than in the US - the overall direction has been lower. Over the past five trading days, US equities have fallen by a little more than 4%, while European equities are marginally higher. That said, US futures are pointing higher this morning, whereas European futures are slightly in the red. In terms of cyclicals versus defensives, the risk-off sentiment has been most pronounced in the US, with cyclicals down more than 5%, while defensives are down around 2%. Europe shows a similar but more muted trend, with modest defensive outperformance. In the US yesterday, the Dow declined by 2.5%, the S&P 500 by 2.4%, the Nasdaq by 2.6%, and the Russell 2000 by 2.1%. With yesterday's moves, the VIX is now back at 33 - a clear reflection of the current environment, where uncertainty is weighing on equities more than hard macro data. Year-to-date, European equities have outperformed US equities by nearly 15% when measured in local currency. However, the recent EUR/USD appreciation adds another ~12% headwind for investors who have not hedged the dollar, making U.S. equity exposure particularly challenging this year. This morning, Asian equities are trading higher, while European futures are lower, and US futures are marginally up.

FI & FX: USD continues to weaken on the back of the economic and political uncertainty in US as well as recent comment from Trump regarding Fed Chairman Powell and the need for "pre-emptive rate cuts" from the Federal Reserve. Short-end rates in the US have fallen since last week, but the long-end continues to rise in a steepening move. Following a dovish ECB meeting with a widely anticipated 25bp rate cut, European rates have rallied, which helped the SEK perform against EUR last Thursday, however, the negative international turmoil has caught up with the SEK and will likely push EURSEK levels back towards our post ECB-decision near-term fair-value assessment of 11.

Daily Pivots: (S1) 1.3798; (P) 1.3825; (R1) 1.3868; More...

Intraday bias in USD/CAD remains on the downside. Firm break of 100% projection of 1.4791 to 1.4150 from 1.4414 at 1.3773 will extend the decline from 1.4791 to 138.2% projection at 1.3528. On the upside, above 1.3868 minor resistance will turn intraday bias neutral again first.

In the bigger picture, the break of 1.3976 resistance turned support (2022 high) and 55 W EMA (now at 1.3982) indicates that a medium term top is already in place at 1.4791. Fall from there would either be a correction to rise from 1.2005, or trend reversal. In either case, firm break of 38.2% retracement of 1.2005 (2021 low) to 1.4791 at 1.3727 will pave the way back to 61.8% retracement at 1.3069.

Daily Pivots: (S1) 0.6379; (P) 0.6408; (R1) 0.6447; More...

Intraday bias in AUD/USD remains on the upside for the moment. Current rise from 0.5913 should target 61.8% retracement of 0.6941 to 0.5913 at 0.6548, even still as a corrective move. On the downside, below 0.6356 minor support will turn intraday bias neutral again first.

In the bigger picture, fall from 0.6941 (2024 high) is seen as part of the down trend from 0.8006 (2021 high). Next medium term target is 61.8% projection of 0.8006 to 0.6169 from 0.6941 at 0.5806. However, sustained trading above 55 W EMA (now at 0.6443) will argue that a medium term bottom was already formed, and set up further rebound to 0.6941 resistance instead.