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EUR/USD

The EUR/USD is testing the support at 1.0974 yet again during the early hours of today`s trading.. A confirmation of the breach here could deepen the decline and could lead to a test of the target at 1.0900, followed by the lower zone at 1.0846. However, if the bearish momentum fades and the bulls prevail, then the first resistance would be the upper border of the range between 1.0974 and 1.1044. A violation of the level at 1.1126 would strengthen the positive expectations for the future path of the pair and could lead to a rally towards the zone at 1.1231. An increase in market volatility can be expected around the announcement of the data on Non-farm Payrolls Change and Unemployment change in the U.S. (Friday; 13:30 GMT).

USD/JPY

The dollar continues its massive rally against the yen as the currency pair had previously violated the resistance zone at 122.41. If the bullish attack continues, then а test of the important zone at 123.00 would be the most probable scenario and could easily lead to even more gains for the Ninja. If the bears take control instead, then the correction should be limited to the support zone at 120.44.

GBP/USD

The pound lost some ground against the dollar during the early hours of today`s trading, and if the bears continue to prevail, then a successful test of the support zone at 1.3099 would strengthen the negative sentiment and could easily deepen the decline towards the zone at 1.3050. Better-than-expected data in the UK for its GDP (Thursday; 07:00 GMT) could help the bulls re-enter the market. A potential breach of the close resistance at 1.3185, followed by a violation of the next target at 1.3289, could lead to a more sustained recovery towards the resistance at 1.3354.

EUGERMANY40

The sentiment remains neutral as the EUGERMANY40 continues to trade in the zone between 14135 and 14555. If the bulls prevail and breach the upper border of the mentioned range, followed by the next target at 14832, then the rally will most likely gain steam and erase all of its losses that it had sustained as a result of the war between Russia and Ukraine.. The first support is still the zone at 14135. A successful test of this level could easily lead to a sell-off towards the level at 13573.

US30

The U.S. index gained some ground, and during the early hours of today’s trading, it is headed towards a test of the resistance at 34890. A violation of the mentioned zone could easily pave the way for an attempt at breaching the next important target at 35037. Success for the bulls here could continue the rally towards 35200. However, if the zone at 35037 withholds the bullish attack, then a correction might develop, but it should be limited to the support at 34096. Important trading news for this week is the expected U.S. Non-farm Payrolls Change and Unemployment change data (Friday; 13:30 GMT).

The week kicks off on a mixed note as US President Joe Biden called Putin a ‘butcher’ and said in a speech in Warsaw that ‘for God’s sake, this man cannot remain in power. Then, the news that Shanghai is going to a phased lockdown didn’t help lifting the mood in Asia.

Oil, which rallied last Friday on news of a drone attack on a Saudi storage facility, slumped again this morning to $110pb.

The new shutdown measures due to covid are expected to be short-term road bumps on a long up-trending road, as the impact of the lockdowns on medium-term oil demand will certainly remain limited, whereas the tight supply concerns – which are amplified by the tensions in Saudi with the Houthi rebels should keep oil prices under a decent positive pressure.

Investors wonder if OPEC will finally boost its oil output to counter the Russian supply disruptions at this week’s meeting, as a potential boycott on Russian oil could lead to a 3-million-barrel fall per day from April, even though the Europeans are not up for banning the Russian oil for now.

Then comes the question of whether the OPEC+ makes sense for the OPEC countries, if Russia starts seeing a significant demand fall for its oil. So far, OPEC stood behind the OPEC+ agreement.

It is reported that OPEC’s scare capacity has fallen to between 2 to 3 million barrels per day, mostly concentrated in Saudi Arabia and the UAE, and the falling OPEC capacity could explain why the OPEC+ agreement is still alive.

To conclude, the war and the worries of falling capacity from OPEC are more disturbing than a Shanghai lockdown. Therefore, the price pullbacks are still seen as opportunities to buy a dip for a further extension of the rally toward the $140/150pb level. On the downside, the 50-DMA, which stands just below the $100pb level should continue giving a solid support for a further rise, unless there is a significant and a material change in the geopolitical situation which would favorize a medium-term decline.

US dollar up

The US dollar begins the week on strong footage, as the dollar index advances above the 99 mark on geopolitical tensions and the Fed hawks. The US 2-year yield just can’t move higher faster, it’s already testing the 2.40% to the upside, while the 10-year yield is just a touch above the 2.53% mark, hinting that the inversion in this portion of the curve is imminent. The 5-10 year spread already inverted and the 5-30 year spread slipped below zero for the first time since 2006, as well.

The flattening and the inversion of the yield curve bring about the worries of a recession in the US, but Fed Chair Powell is pushing back against concerns that an inverted yield curve would signal the economy is headed for a recession. He says that it makes more sense to focus on the shorter end, where curves remain steep. In reality, there is nothing he could do about it, as the inflation problem needs to be addressed fast.

The EURUSD slipped below the 1.10 mark on the back of a stronger US dollar, and there seems to be little that the ECB hawks could do against such a strong US dollar right now, even with the prospects that the rising inflation in Europe would force the ECB to become more aggressive on its tightening plans.

Daily Pivots: (S1) 160.05; (P) 160.77; (R1) 161.69; More...

Intraday bias in GBP/JPY remains on the upside and outlook is unchanged. Current up trend should target 61.8% projection of 136.96 to 158.19 from 150.95 at 164.07. next. On the downside, however, break of 159.01 minor support will tun intraday bias neutral, and bring consolidations first, before staging another rally.

In the bigger picture, up trend from 123.94 (2020 low) is still in progress, and notable support from 55 week EMA affirms medium term bullishness. Next target is 61.8% retracement of 195.86 (2015 high) to 122.75 (2016 low) at 167.93. Sustained break there will be a long term bullish signal. This will now remain the favored case as long as 150.95 support holds.

Daily Pivots: (S1) 133.65; (P) 134.20; (R1) 134.67; More....

Intraday bias in EUR/JPY remains on the upside at this point. Current up trend should target 136.53 projection level next. On the downside, though, break of 132.31 minor support will turn bias neutral and bring consolidations first, before staging another rally.

In the bigger picture, up trend from 114.42 (2020 low) is in progress and resuming. Next target is 61.8% projection of 114.42 to 134.11 from 124.37 at 136.53, and then 137.49 (2018 high). In any case, outlook will now remain bullish as long as 124.37 support holds, in case of deep pull back.

Daily Pivots: (S1) 1.4572; (P) 1.4637; (R1) 1.4679; More...

Intraday bias in EUR/AUD remains on the downside. The breach of 1.4561 short term bottom indicate larger down trend resumption. Next target is 1.3623 projection level. On the upside, above 1.4804 minor resistance will delay the bearish case, and turn bias back to the upside for another recovery first.

In the bigger picture, fall from 1.9799 is seen as a long term impulsive move. Next target is 61.8% projection of 1.9799 to 1.5250 from 1.6434 at 1.3623, which is close to 1.3624 long term support (2017 low). Some support could be seen there to bring interim rebound. But overall, break of 1.5354 support turned resistance is needed to be the first sign of medium term bottoming. Otherwise, outlook will stay bearish in case of recovery.

Daily Pivots: (S1) 0.8314; (P) 0.8342; (R1) 0.8360; More...

Intraday bias in EUR/GBP remains neutral for the moment. On the downside, below 0.8294 will resume the fall from 0.8456 to retest 0.8201 low. Firm break there will resume larger down trend. On the upside, however, break of 0.8456 will resume the rebound from 0.8201 to 0.8476 structural resistance.

In the bigger picture, the down trend from 0.9499 is expected to continue as long as 0.8476 resistance holds. Sustained trading below 0.8276 support will argue that the whole up trend from 0.6935 (2015 low) has reversed. Deeper fall should be seen to 61.8% retracement of 0.6935 to 0.9499 at 0.7917 next. However, firm break of 0.8476 will indicate medium term bottoming at least. Focus will be back on 55 week EMA (now at 0.8523) for more evidence of bullish reversal.

Daily Pivots: (S1) 1.0198; (P) 1.0218; (R1) 1.0242; More....

Intraday bias in EUR/CHF remains neutral for the moment. On the downside, break of 1.0814 will indicate that rebound from 0.9970 has completed at 1.0400, ahead of 38.2% retracement of 1.1149 to 0.9970 at 1.0420. In this case, intraday bias will be turned back to the downside for retesting 0.9970 low. On the upside, break of 1.0400 will resume the rebound to 1.0610 key structural resistance.

In the bigger picture, long term down trend from 1.2004 (2018 high) is still in progress. Next target is 100% projection of 1.2004 to 1.0505 to 1.1149 at 0.9650. In any case, sustained break of 1.0505 support turned resistance is needed to be the first sign of medium term bottoming. Otherwise, outlook will remain bearish.

Daily Pivots: (S1) 1.2444; (P) 1.2499; (R1) 1.2531; More...

Intraday bias in USD/CAD remains on the downside for 1.2448 support. Sustained break there will argue that whole corrective pattern from 1.2005 has completed and bring retest of this low. On the upside, above 1.2585 minor resistance will turn intraday bias neutral and bring consolidations first, before staging another fall.

In the bigger picture, focus stays on 38.2% retracement of 1.4667 (2020 high) to 1.2005 (2021 low) at 1.3022. Sustained break there should confirm that the down trend from 1.4667 has completed after defending 1.2061 long term cluster support. Further rise would then be seen towards 61.8% retracement at 1.3650. However, rejection by 1.3022 will maintain medium term bearishness. Break of 1.2005 will resume the down trend from 1.4667 and that carries larger bearish implications too.

Daily Pivots: (S1) 0.7495; (P) 0.7516; (R1) 0.7537; More...

Despite loss of upside momentum as seen in 4 hour MACD, intraday bias in AUD/USD stays on the upside for 0.7555 resistance. Decisive break there should confirm that whole corrective decline from 0.8006 has completed at 0.6966. Further rise should then be seen back to retest 0.8005. On the downside, below 0.7465 minor support will turn intraday bias neutral and bring consolidations first.

In the bigger picture, correction from 0.8006 could have completed at 0.6966, after drawing support from 0.6991. That is, up trend from 0.5506 (2020 low) might be ready to resume. Firm break of 0.8006 will target 61.8% projection of 0.5506 to 0.8006 from 0.6966 at 0.8511 next. This will remain the favored case as long as 0.7164 support holds.

Daily Pivots: (S1) 1.0964; (P) 1.1001; (R1) 1.1021; More...

Intraday bias in EUR/USD remains neutral for the moment. Further decline is still in favor with 1.1120 support turned resistance intact. On the downside, break of 1.0899 minor support will target 61.8% projection of 1.2265 to 1.1120 from 1.1494 at 1.0786. However, firm break of 1.1120 will confirm short term bottoming at 1.0805. Bias will be back on the upside for 55 day EMA (now at 1.1178) and above.

In the bigger picture, the decline from 1.2348 (2021 high) is expected to continue as long as 1.1494 resistance holds. Firm break of 1.0635 (2020 low) will raise the chance of long term down trend resumption and target a retest on 1.0339 (2017 low) next. Nevertheless, break of 1.1494 will maintain medium term neutral outlook, and extending term range trading first.