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Daily Pivots: (S1) 0.9173; (P) 0.9216; (R1) 0.9249; More....

Intraday bias in EUR/CHF is turned neutral first with current retreat. On the upside, sustained trading above 61.8% retracement of 0.9394 to 0.8979 at 0.9235 will pave the way to 0.9394 key resistance next. However, break of 0.9155 support will turn bias back to the downside for 0.8979 low.

In the bigger picture, as long as 55 W EMA (now at 0.9286) holds, the larger down trend from 0.9928 (2024 high) is still expected to continue through 0.8979 at a later stage. However, sustained break of 55 W EMA should confirm medium term bottoming, and bring stronger rise through 0.9394 resistance, even as a corrective move.

Markets

It was April fool’s day after all. US President Trump pulled a Trump. Talking the (stock) market up from the sell-off lows only to make space for another blow. Rumours and suggestions of ending the war against Iran while leaving the Strait of Hormuz blocked triggered a short squeeze in riskier assets earlier this week even as those messages still conflicted with what is happening on the ground. Markets found their Easter egg when the US President addressed the nation during a speech last night. Again, the writing was on the wall in a series of social media posts shortly after US trading got started. It didn’t prevent key US equity indices from another 0.5%-1.15% gains yesterday. Gains which have been blasted away in futures trading by now (-2%). The core of the matter: Trump tried to sell to the American people why they went to war in the first place and made the case for more and stronger action against Iran in the next 2-3 weeks. He threatened to destroy all of the country’s infrastructure, including its oil facilities and electric power production, unless Iran agrees to a deal. He showed no intention whatsoever for leaving the Middle-East without control over the Strait of Hormuz. Brent crude (June contract) spiked from around $100/b to $107 and sets its eye on the contract high at $110. The fog of war is thick and erring on the side of caution going into the long Easter weekend remains our preferred scenario. Risks of escalation are high. US Treasuries drop back to Monday’s levels this morning. At the front end because of central bank reaction functions, at the long end because of rising risk premia. US T’s already underperformed yesterday as amongst others due to a batch of consensus-beating US eco data. The US economy added 62k jobs in March according to the private sector ADP employment report. Headline retail sales rose by 0.6% M/M, be it in February. Growth in the control group, proxy for consumption in GDP calculation, also beat consensus at 0.5% M/M (vs 0.3%). The March manufacturing ISM rose from 52.4 to 52.7, the best level since August 2022. Details were less encouraging though. The pace of new order growth slowed with the order backlog declining as well. Both continue to point to expanding activity though, but new uncertainty over the Iran war in combination with very large price increases over the last few months don’t bode well for coming months. The survey’s price index jumped from a lofty 70.5 in February to 78.3, also the highest since 2022. All commodity prices in the survey (24) were reported up with 25% of them reported in short supply. The head of the ISM survey said that the impact of the Iran war is more pronounced because it’s on top of other stuff (chaotic tariff environment). On FX markets, the dollar rebounded together with the oil price. EUR/USD’s attempt to regain the 1.16 figure failed (currently 1.1535).

News & Views

The Trump administration is changing its steel and aluminum tariff regime in response to domestic companies calling it too complex to calculate the appropriate charges. The current 50% duty will remain in place for so called commodity-grade steel and aluminum products – goods that are made almost entirely made of the metals. A 25% levy would be applied to the entire value of a finished product (called derivative products) containing one or both of the commodities and would replace the earlier 50% that only applies to the steel or aluminum used. While the rate in the new system will be lower in many cases, the net effect is that actual tariffs will end up higher than before the adjustment because of the larger calculation base. In other tariff news, the administration may announce today tariffs of as much as 100% on select pharmaceutical companies’ products that haven’t struck a deal with the White House to lower their prices.

The US Treasury yesterday said it would meet domestic and international insurance regulators to discuss the risks in private credit. The department said the objective is to “allow participants to survey recent market events, emerging risks, risk management practices and outlooks for the sector”. It highlights growing concern about the sector’s health after recent upheaval and the increasing intertwinement with the insurance sector. US life insurers for example have been investing in what are known as opaque, illiquid and often complex private credit products in search for higher returns while large private capital managers have been partnering up with insurers amongst others to manage their investment portfolios.

Daily Pivots: (S1) 1.1479; (P) 1.1521; (R1) 1.1596; More….

EUR/USD's rebound stalled at 1.1626 and reversed, but it's still bounded in established range. Intraday bias stays neutral first. With 1.1666 cluster resistance (38.2% retracement of 1.2081 to 1.1408 at 1.1665) intact, further decline is expected. On the downside, firm break of 1.1408 will resume the fall from 1.2081 to 38.2% retracement of 1.0176 to 1.2081 at 1.1353. However, decisive break of 1.1666 will argue that the fall from 1.2081 has completed, and turn bias back to the upside for 61.8% retracement of 1.2081 to 1.1408 at 1.1824.

In the bigger picture, prior break of 55 W EMA (now at 1.1497) should confirm rejection by 1.2 key cluster resistance level. The whole up trend from 0.9534 (2022 low) might have completed as a three wave corrective rise too. Deeper fall is expected to long term channel support (now at 1.0535). Meanwhile, risk will stay on the downside as long as 1.2081 holds, even in case of strong rebound.

Daily Pivots: (S1) 158.33; (P) 158.67; (R1) 159.12; More...

Intraday bias in USD/JPY is turned neutral first with break of 159.31 minor resistance. Consolidations from 160.45 could extend further with another falling leg. But overall outlook will remain bullish as long as 157.49 cluster support (38.2% retracement of 152.25 to 160.45 at 157.31) holds. Firm break of 160.45 will resume the rise from 152.25 to retest 161.94 high.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 152.97) holds. Firm break of 161.94 will pave the way to 61.8% projection of 102.58 to 161.94 from 139.87 at 176.75.

Daily Pivots: (S1) 1.3235; (P) 1.3290; (R1) 1.3362; More...

GBP/USD's rebound stalled at 1.3345 and reversed, but downside is contained above 1.3158 temporary low. Intraday bias remains neutral and further decline is in favor. Below 1.3158 will resume the fall from 1.3867 to 1.3008 structural support. However, firm break of 1.3479 will indicate that the fall from 1.3867 has completed, and turn bias back to the upside for stronger rally.

In the bigger picture, considering bearish divergence condition in both D and W MACD, a medium term top should be in place at 1.3867. Firm break of 1.3008 support will argue that fall from 1.3867 is at least correcting the rise from 1.0351 (2022 low) with risk of bearish reversal. That would open up further decline to 38.2% retracement of 1.0351 to 1.3867 at 1.2524. For now, medium term outlook will be neutral at best as long as 1.3867 resistance holds, or until further development.

Daily Pivots: (S1) 0.7895; (P) 0.7953; (R1) 0.8001; More….

USD/CHF recovered after drawing support from near-term rising channel floor, but stays below 0.8041 temporary top. Intraday bias remains neutral first and further rally is in favor. On the upside, break of 0.8041 will resume the whole rally from 0.7603, and target 38.2% retracement of 0.9200 to 0.7603 at 0.8213. However, decisive break of 0.7833 support will argue that the rebound has completed, and turn bias back to the downside for deeper fall.

In the bigger picture, a medium term bottom should be in place at 0.7603 on bullish convergence condition in D MACD. Rebound from there is seen as correcting the fall from 0.9200 only. However, decisive break of 55 W EMA (now at 0.8088) will suggest that it's probably correcting the larger scale down trend from 1.0146 (2022 high). On the other hand, rejection by the 55 W EMA will setup down trend resumption to 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382 at a later stage.

Daily Pivots: (S1) 1.3858; (P) 1.3890; (R1) 1.3907; More...

Intraday bias in USD/CAD stays neutral for the moment, and some more consolidations could be seen below 1.3965 temporary top. In case of another fall, downside should be contained above 1.3751 resistance turned support. On the upside, decisive break of 38.2% retracement of 1.4791 to 1.3480 at 1.3981 will argue that it's already reversing the whole down trend from 1.4791, and target 61.8% retracement at 1.4290. However, firm break of 1.3751 should indicate rejection by 1.3981, and keep the fall from 1.4791 intact. Bias will be back on the downside for retesting 1.3480 low.

In the bigger picture, price actions from 1.4791 are seen as a corrective pattern to the whole up trend from 1.2005 (2021 low). Deeper fall could be seen, as the pattern extends, to 61.8% retracement of 1.2005 to 1.4791 at 1.3069. However, decisive break of 1.3927 resistance will argue that the correction has completed with three waves down to 1.3480 already. Further break of 1.4139 will confirm and bring retest of 1.4791 high.

Swiss inflation remained subdued in March, with CPI rising 0.2% mom, below expectations of 0.5% mom. Annual inflation edged up from 0.1% yoy to 0.3% yoy, also missing forecasts of 0.5% yoy. The data highlights a continued lack of underlying price pressure despite some pickup in energy-related components.

The breakdown shows a clear divergence. Imported product prices rose sharply by 1.8% mom, driven by higher costs for heating oil and fuel. However, domestic product prices fell -0.2% mom, and core CPI was flat at 0.0% mom, signaling that internal inflation dynamics remain weak.

On a yearly basis, core CPI held steady at 0.4% yoy, while domestic price growth eased slightly from 0.6% yoy to 0.5% yoy. Import prices, although still negative at -0.3% yoy, rose significantly from -1.6% yoy, reflecting external cost pressures.

Overall, the data suggests that inflation in Switzerland is being driven by imported factors rather than domestic demand, keeping underlying price trends contained.

Full Swiss CPI release here.

Daily Pivots: (S1) 0.6895; (P) 0.6930; (R1) 0.6964; More...

AUD/USD's recovery stalled at 0.6962 and reversed. But downside is contained above 0.6832 temporary low. Intraday bias remains neutral. first. Below 0.6832 will extend the decline from 0.7187 to 38.2% retracement of 0.5913 to 0.7187 at 0.6700. However, firm break of 0.6978 will argue that the correction has completed, and bring retest of 0.7817 high.

In the bigger picture, as long as 0.6706 cluster support holds, rise from 0.5913 (2024 low) should still be in progress. Decisive break of 61.8% retracement of 0.8006 to 0.5913 at 0.7206 will solidify the case that it's already reversing the down trend from 0.8006 (2021 high). However, firm break of 0.6706 will dampen this bullish case, and bring deeper fall back to 0.6420 support, and possibly below.

Markets have flipped back into risk-off mode as oil rebounds above $110 following US President Donald Trump’s escalation signals at his highly anticipated Iran War update. Investors are now pricing a stagflation shock, with oil surging, stocks falling, and Dollar rebounding. However, the risk of a more catastrophic escalation remains underappreciated.

What makes the current moment particularly dangerous is timing. The next 72 hours, leading into a long weekend, present a high-risk window for escalation. With global markets set to close, the US, Israel, and Iran all have strategic incentives to act when immediate market reaction is limited.

Trump’s rhetoric has already laid the groundwork. His pledge to “hit them extremely hard over the next two to three weeks” defines a clear escalation window. Combined with the threat to “bring them back to the Stone Ages,” it signals a move toward broader infrastructure targeting rather than limited strikes.

If such actions begin, the nature of the conflict changes fundamentally. A coordinated campaign against infrastructure would likely trigger retaliation beyond Iran’s borders, particularly against regional oil producers. This is the scenario that markets are not yet fully pricing.

Iran’s response options would be increasingly asymmetric. With conventional capabilities degraded, retaliation could come through cyber attacks on US systems or targeted strikes on oil facilities in Saudi Arabia and the UAE. These actions would directly impact global supply and amplify the energy shock.

Despite these risks, current market pricing remains focused on inflation. The stagflation trade is back, with oil as the inflation trigger driving higher-for-longer interest rate expectations. Markets are pricing inflation and recession—and not yet disruption.

Brent above $110 reflects inflation fears, but a move above $120 would signal that markets are beginning to price physical supply disruption—something not yet fully embedded. The $120 level is the canary level for whether escalation risk becomes systemic.

Asset price moves reflect this partial adjustment. Asian equities are under pressure, led by a sharp drop in KOSPI, while Dollar is rebounding strongly. Loonie is supported by oil, and Yen is benefiting from risk aversion, while high-beta currencies such as Kiwi and Aussie are weakening.

The broader environment is one of maximum uncertainty. The gap between official messaging and operational signals has left markets without clarity. For now, markets remain in a transitional phase—adjusting to higher inflation risks but not yet to the possibility of systemic disruption. This creates a dangerous imbalance in expectations.

The key risk is not what markets are pricing now, but what they are not. If escalation intensifies, the current stagflation narrative could quickly give way to a more severe shock.

In Asia, at the time of writing, Nikkei is down -2.49%. Hong Kong HSI is down -1.43%. China Shanghai SSE is down -1.15%. Singapore Strait Times is down -0.90%. Japan 10-year JGB yield is up 0.087 at 2.391. Overnight, DOW rose 0.48%. S&P 500 rose 0.72%. NASDAQ rose 1.16%. 10-year yield rose 0.008 to 4.319.

From Exit Hopes to Escalation: Trump Address Raises Risk of Brent Break Above $120–125

Oil is back near $110—and the risk is now higher. Trump’s escalation signals have shifted markets sharply, with Brent potentially breaking above $120–125 as supply fears surge. Read more.

AUD/USD Daily Report

Daily Pivots: (S1) 0.6895; (P) 0.6930; (R1) 0.6964; More...

AUD/USD's recovery stalled at 0.6962 and reversed. But downside is contained above 0.6832 temporary low. Intraday bias remains neutral. first. Below 0.6832 will extend the decline from 0.7187 to 38.2% retracement of 0.5913 to 0.7187 at 0.6700. However, firm break of 0.6978 will argue that the correction has completed, and bring retest of 0.7817 high.

In the bigger picture, as long as 0.6706 cluster support holds, rise from 0.5913 (2024 low) should still be in progress. Decisive break of 61.8% retracement of 0.8006 to 0.5913 at 0.7206 will solidify the case that it's already reversing the down trend from 0.8006 (2021 high). However, firm break of 0.6706 will dampen this bullish case, and bring deeper fall back to 0.6420 support, and possibly below.