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Spot Gold is consolidating within narrow range around $1286 target (Fibo 76.4% of $1337/$1122 descend) which was met on strong two-day bullish acceleration.

Gold was initially supported by rising geopolitical concerns that boosted demand for safe haven assets and fresh weakness of the dollar, triggered by comments from US President Donald Trump who said that the dollar is too strong and that he prefers lower rates.

Interest rate sensitive gold reacted on comments on strong bullish acceleration that ended with nearly 2.5% gains in past two days.

Strong bullish sentiment keeps gold well supported for attack at next strong barrier at $1293 (weekly cloud top) and psychological $1300 barrier in extension.

Overbought daily studies warn of easing, which might be boosted by profit-taking after strong rally at the end of holiday-shortened week, however, no firmer technical signals have been generated for now.

Session low at $1283 marks immediate support, ahead of Wednesday’s low at $1271 and rising daily Tenkan-sen at $1265.

Res: 1287, 1293, 1300, 1307
Sup: 1283, 1279, 1271, 1265

The Aussie dollar was the top winner in Asian session, gaining nearly 1% against the US dollar and hitting session high at 0.7600 zone.

The pair accelerated higher in late Wednesday after President Donald Trump said that the US dollar is getting too strong that pushed the greenback sharply lower across the board.

The Aussie received fresh boost from Australian jobs data that showed unexpected increase in number of employed people in March by 60.900, which came well above forecasted 20.000 and upwards-revised number of 2800 new jobs in February.

Aussie rallied sharply from session low at 0.7514 and peaked ticks ahead of psychological 0.7600 barrier (Fibo 61.8% of 0.7677/0.7472 downleg), which is reinforced by converged daily 30/20SMA’s.

Initial bullish signal was generated on Wednesday’s close above 100SMA (0.7515), with subsequent strong bullish acceleration that took out next pivot at 0.7550 (200SMA), turning near-term picture bullish.

The pair may enter consolidative /corrective phase ahead of cluster of resistances at 0.7600/20 zone, as near-term studies are extremely overbought. Downticks should hold above broken 200SMA to keep fresh near-term bulls in play for further upside action.

Conversely, loss of 200SMA handle would soften near-term structure and turn risk lower.

Res: 0.7593, 0.7620, 0.7642, 0.7677
Sup: 0.7575, 0.7550, 0.7515, 0.7472

'I think our dollar is getting too strong, and partially that's my fault because people have confidence in me.' – Donald Trump (based on Bloomberg)

Pair's Outlook

The common European currency traded above the 1.0650 mark against the US Dollar on Wednesday morning, as the currency exchange rate was approaching the monthly PP, which was located at the 1.0686 level. The pair traded a lot higher and had surged on Wednesday due to comments made by the President of the US Donald Trump, who remarked that he would like to see the Greenback weaker for the purpose of stimulating exports. The rate is most likely going to pass the resistance of the monthly PP and begin to move higher. Afterwards the next resistance is the weekly R2 at 1.0729 mark.

Traders' Sentiment

SWFX trades have not changed their opinion, as 51% of open positions are long. However, 56% of trader set up orders are to buy.

'In view rising geopolitical risk and Brexit uncertainties, we expect limited upside potential in GBPUSD this week.' – BMO Capital Markets (based on PoundSterlingLive)

Pair's Outlook

The Cable's upside development yesterday caused the six-month down-trend to be put to the test again, pointing to a possible trend reversal. Technical indicators once more suggest the British Pound is to outperform the Greenback, but even if the resistance line gets fully pierced, there are still obstacles on the Cable's path, the main one being the 200-day SMA around 1.2634. Nevertheless, in case of another bullish development today gains are unlikely to exceed the 1.26 major level. On the other hand, a set of positive US fundamentals could provide the Buck with a sufficient boost, which would result in the pair's decline and a solid reconfirmation of the bearish trend-line.

Traders' Sentiment

Today only 54% of all open positions are long (previously 55). At the same time, the share of sell orders inched up from 49 to 55%.

'The dollar's already under pressure, so I think any excuse for further pressure is likely to bring the greenback even lower.' – Kathy Lien, BK Asset Management (based on Business Recorder)

Pair's Outlook

The USD/JPY currency pair experienced another leg down on Wednesday, causing the descending channel's support line to be reconfirmed. From a technical perspective another decline is doubtful, as the channel's support line is now also reinforced by the weekly S3 and the 200d-day SMA. Although the Greenback has a number of resistances on its path today, those are not expected to prevent the US Dollar from recovering today, despite technical indicators suggesting otherwise. However, gains are likely to be capped near 110.00, with the exchange rate beginning its journey towards the channel's upper border.

Traders' Sentiment

Bullish market sentiment remains unchanged at 70%, while the portion of purchase orders inched lower from 61 to 56%.

"The market is slightly on the overbought side, but given what we have seen in the past few days, we might see prices testing $1,300." – Wang Tao, Reuters Pair's Outlook Due to US Dollar weakness caused by comments made by Donald Trump on Wednesday the yellow metals price jumped and reached above the 1,285 level. There it remained on Thursday morning. The bullion is most likely going to continue the surge and test the resistance levels near the 1,300 mark, as it faces no resistance up to the 1,297.58 mark, where the weekly R3 is located at. Meanwhile, the rate is supported by the weekly R2, which is located at the 1,284.58 level. However, it is unlikely that the 1,300 mark will be passed, as a strong cluster of resistance surrounds it. Traders' Sentiment Traders remain bearish, as 53% of open positions are short. Meanwhile, 59% of pending commands are to buy the metal.

'Big picture remains a labour market with very strong employment plateauing at record highs ... combined with a pay disaster.' - Torsten Bell, Resolution Foundation

Employment data released on Wednesday confirmed the view that pay growth in the United Kingdom slowed significantly following the country's decision to leave the European Union, which boosted inflation across the country amid the sharp fall in the value of the Pound. The Office for National Statistics reported that wage growth adjusted for inflation climbed just 0.2% in the three-month period to February. Including bonuses, average hourly earnings advanced 2.3%, unchanged from the prior period, whereas analysts anticipated a 2.1% gain. Pay growth is closely followed by the Bank of England, as it is tied to consumer spending, which account for more than 60% of the UK economy. At its latest meeting, the BoE said that consumer inflation would average 2.7% this year. Meanwhile, the unemployment rate came in at a record low of 4.7%, unchanged from the three-month period to January and in line with analysts' expectations. The number of Britons filing for unemployment aid rose 25,500 to 765,400 in March, the largest gain since July 2011, compared to the preceding month's downwardly revised fall of 6,100, while markets held expectations for a decline of 10,200. The data also showed that job vacancies advanced 16,000 to a record high of 767,000.

"As the Federal Reserve starts to tighten interest rates, we're going to quite naturally import some of that rise and in fact we have seen that." - Carolyn Wilkins, Bank of Canada

As markets expected, the Bank of Canada left its monetary policy unchanged at its meeting on Wednesday amid strong economic performance. The BoC Governor Stephen Poloz said that the Bank would maintain its neutral stance despite an upward revision to economic growth forecasts for this year. However, Poloz sounded less dovish than at the January policy meeting, when policymakers discussed a possible rate cut. Nevertheless, the Bank stated that the economy continued to operate with material excess capacity and both business investment and pay growth remained subdued. Poloz pointed also to surging housing prices, adding that the sharp price rise was not driven by any fundamentals. Indeed, house prices in Toronto jumped more than 33% in March compared to a year ago. Later in the day, Poloz said that it would be wrong for the Bank to try to offset drivers that boost the Canadian Dollar but added that the weaker currency would be beneficial for some sectors and the country's exports. Meanwhile, the BoC Senior Deputy Governor Carolyn Wilkins said that even though the Bank ignored the recent hikes by the Federal Reserve, higher interest rates in the US would have a significant impact on Canada. After the release, the Canadian Dollar hit its six-week high against its US counterpart.

"U.S. oil production rose to the highest level in over a year, leaving oil prices weaker on the day after the U.S. EIA released its data." - ANZ

US crude oil inventories dropped more than expected last week, official figures revealed on Wednesday. The Energy Information Administration reported on Wednesday that US crude stocks fell 2.2M barrels in the week ended April 7, following the preceding week's gain of 1.6M barrels. In the meantime, market analysts anticipated a slighter drop of 700,000 barrels during the reported period. The EIA reported also that refineries produced on average 9.9M barrels of gasoline per day and 5.1M barrels of distillate per day. Furthermore, gasoline inventories dropped 3M barrels last week, boosting market sentiment. Despite a bigger than expected drop in US crude oil inventories, oil prices fell from their five-week highs, reached last week after the United States launched a set of airstrikes against the Syrian government. However, oil prices managed to continue trading above $55. Earlier in the day, OPEC released promising reports that showed that production dropped more than initially expected last month. Nevertheless, OPEC revised up its forecast for supplies from non-member countries in 2017. OPEC and other oil producers agreed in November to cut output by 1.8M barrels per day during the first half of 2017 in order to stabilise the oil market.

EUR/GBP         –  0.8483

EUR/GBP – The major (A)(B)(C)-(X)-(A)(B)(C) correction from 0.9805 is unfolding and 2nd (A) has possibly ended at 0.6936.

As the single currency has fallen again after brief recovery and broke below indicated support at 0.8485 would signal top has been formed at 0.8788, hence bearishness is seen for further weakness to 0.8460-65, break there would signal the rebound from 0.8403 has ended, then retest of this support would follow. Looking ahead, only a daily close below 0.8403 would signal early correction from 0.8304 has ended at 0.8857, bring further fall to 0.8340-50 but said support at 0.8304 should hold on first testing,

Our latest preferred count is that the wave V of a 5-wave series from 0.5682 ended at 0.9805 earlier and major from there has possibly ended at 0.8067 as A-B-C-X-A-B-C. We are keeping our view that the entire correction from 0.9805 has possibly ended at 0.7756 and as labeled as the attached daily chart and impulsive move from 0.9084 has ended at 0.7756 as a 5-waver which marked either the (C) wave or the A leg of (C), a daily close above resistance at 0.8831 would suggest (C) leg has ended and headway towards 0.9084.

On the upside, whilst initial recovery to 0.8535-45 cannot be ruled out, reckon upside would be limited to 0.8600, bring another decline later. A daily close above 0.8600 would suggest the retreat from 0.8788 has ended instead, risk a stronger recovery to 0.8660-65, however, break of resistance at 0.8735 is needed to retain bullishness and signal the fall from 0.8788 has ended, bring further gain to 0.8760 first. Looking ahead, only above said resistance at 0.8788 would extend the rebound from 0.8403 towards indicated resistance at 0.8857 which is likely to hold from here.
 
Recommendation: Exit long entered at 0.8510 and stand aside for this week.

Euro's long term uptrend started in Feb 1981 at 0.5039 and is unfolding as a (A)-(B)-(C) move with (A): 0.8433 (Feb 1993), (B): 0.5682 (May 2000) and impulsive wave (C) should have ended at 0.9805 with wave III ended at 0.7254 (May 2003), triangle wave IV at 0.6536 (23 Jan 2007) and wave V as well as wave (C) has ended at 0.9805.

We are keeping an alternate count that only wave III ended at 0.9805 and the correction from there is the wave IV and may extend weakness to 0.7700, however, it is necessary to see a daily close above resistance at 0.9143 would change this to be the preferred count.