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During Friday's trading session, the common European currency traded by 42 base points against the Japanese Yen.

Everything being equal, it is likely that the EUR/JPY currency pair will continue its downside movement. The potential target for bearish traders would be near a support cluster formed by the combination of the weekly and the monthly pivot points at 122.59.

Meanwhile, our technical indicators demonstrate that bears could continue their dominance in the market in the short-term.

The Australian Dollar has depreciated about 50 base points against the US Dollar since Friday's trading session.

As for the near future, it is likely that bearish traders would drive the AUD/USD currency pair further south. The potential downside target will be near a support cluster formed by the combination of the weekly and the monthly pivot points at the 0.6959 area.

If the support cluster holds, a brief retracement towards the upper boundary of a descending channel pattern at 0.6987 could be expected during the following trading session.

Given that the US Dollar failed to break a resistance level at 1.3484 during Friday's trading session, it is likely that bears could push the currency pair lower within this session.

Although, if the support cluster formed by the 200-hour simple moving average and the weekly pivot point at 1.3399 holds, the exchange rate could gather enough momentum to break the resistance level as mentioned above.

However, if bears are able to push the currency exchange rate past the support level at 1.3399, a decline towards the weekly S2 at 1.3310 could be expected during the following trading session.

The 200-hour simple moving average proved to have enough strength to restrict the New Zealand Dollar from edging higher against the US Dollar during Friday's trading session.

Everything being equal, it is likely that the NZD/USD currency pair will continue its downside movement within this session. The possible targets for bearish traders will be near a support line at 0.6542.

On the other hand, the currency exchange rate could reverse from the current price level at 0.6578 and aim for a re-tests of the 200-hour simple moving average at 0.6608.

The EUR/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.12128
Open: 1.12299
% chg. over the last day: +0.12
Day's range: 1.12271 – 1.12407
52 wk range: 1.1111 – 1.2009

EUR/USD is relatively in balance against the USD. The EUR/USD quotes are consolidating. The local support and resistance levels are 1.12150 and 1.12400. The trading conflict between Washington and Beijing remains in the spotlight. Last week Donald Trump increased the fees on the Chinese wares worth more than 200 billion USD from 10% to 25%. The market hasn't reacted yet, there hasn't been any response from China either. The investors are waiting on more intel regarding this. EUR/USD has a tendency for further growth. You should open positions from the key levels.

The Economic News Feed for 13.05.2019 is calm.

The price fixed above 50 MA and 200 MA which points to the power of the buyers.

The MACD histogram is in the positive zone but below the signal line which gives a weak signal to buy EUR/USD.

The Stochastic Oscillator is in the neutral zone, the %K line is above the %D line which points towards a bullish mood.

Trading recommendations

Support levels: 1.12150, 1.11850, 1.11650
Resistance levels: 1.12400, 1.12600

If the price fixes above 1.12400, expect further growth of EUR/USD toward 1.12600-1.12800.

Alternatively, the quotes can fall toward 1.11900-1.11700.

The GBP/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.30126
Open: 1.29926
% chg. over the last day: -0.12
Day's range: 1.29926 – 1.30166
52 wk range: 1.2438 – 1.3631

GBP/USD keeps moving sideways without a defined trend. The key support and resistance levels are 1.29800 and 1.30400. The financial market participants are doubting that Theresa May won't be able to reach a consensus with the opposition to leave the EU. The GBP/USD quotes have a tendency to descend. You should open positions from the key levels.

The Economic News Feed for 13.05.2019:

The indicators do not provide precise signals, the price has crossed 50 MA.

The MACD histogram is close to 0.

The Stochastic Oscillator is in the neutral zone, the %K line is below the %D line which points towards a bearish mood.

Trading recommendations

Support levels: 1.29800, 1.29400, 1.29100
Resistance levels: 1.30400, 1.30800, 1.31300

If the price fixes below 1.29800, expect further descend toward 1.29400-1.29100.

Alternatively, the quotes can recover toward 1.30800-1.31000.

The USD/CAD currency pair

Technical indicators of the currency pair:

Prev Open: 1.34646
Open: 1.34208
% chg. over the last day: -0.48
Day's range: 1.34162 – 1.34453
52 wk range: 1.2727 – 1.3664

On Friday USD/CAD had some agressive sales and updated the local minimums. The demand for CAD has grown after a positive Canadian labour market report. USD/CAD quotes are consolidating around 1.34150-1.34450. USD/CAD has a tendency to descend. The positions should be opened from the key levels. You should keep an eye on the oil quotes dynamics.

The Economic News Feed for 13.05.2019 is calm.

The indicators do not provide precise signals, 50 MA has crossed 200 MA.

The MACD histogram is in the negative zone but above the signal line which gives a weak signal to sell USD/CAD.

The Stochastic Oscillator is in the neutral zone, the %K line is below the %D line which points towards a bearish mood.

Trading recommendations

Support levels: 1.34150, 1.33800
Resistance levels: 1.34450, 1.34750, 1.35000

If the price fixes below 1.34150, expect further descend toward 1.33800-1.33600.

Alternatively, the qutoes can grow toward 1.34750-1.34900.

The USD/JPY currency pair

Technical indicators of the currency pair:

Prev Open: 109.742
Open: 109.760
% chg. over the last day: +0.16
Day's range: 109.597 – 109.836
52 wk range: 104.97 – 114.56

USD/JPY keeps consolidating after a long fall since the beginning of the month. There is no defined trend. The key support and resistance levels are 109.500 and 110.000. The demand for the safe assets remains high after the escalation of the US/China trading conflict. The instrument has a tendency to descend. You should open positions from the key levels.

The Economic News Feed for 13.05.2019 is calm.

The indicators do not provide precise signals, the price has crossed 50 MA.

The MACD histogram is in the negative zone and below the signal line which gives a strong signal to sell USD/JPY.

The Stochastic Oscillator is in the neutral zone, the %K line is below the %D line which points to the bearish mood.

Trading recommendations

Support levels: 109.500, 109.000
Resistance levels: 110.000, 110.300, 110.650

If the price fixes below 109.500, expect further descend toward 109.300-109.000.

Alternatively, the quotes can recover toward 110.300-110.500.

Gold prices have been developing within a consolidation area over the last month, with upper boundary the 1290 resistance level and lower boundary the 1266 barrier. Currently, the price hovers beneath the 23.6% Fibonacci retracement level of the downleg from 1346.60 to 1266, around 1285 as well as between the 20- and 40-simple moving averages (SMAs).

From the technical point of view, in the 4-hour chart the stochastic oscillator is turning lower, while the RSI and the MACD are pointing down below 50 and the trigger line respectively, suggesting a possible negative movement.

If the market reverses even lower, immediate support could come from the 1279 support level, taken from the latest lows. A sharper bearish structure could send the yellow metal until the lower boundary of the sideways channel, to the four-month low of 1266.

Otherwise, the price could retest the 23.6% Fibonacci of 1285 before moving near the 1290 resistance. A jump above the latter would end the consolidation phase, opening the way towards the 38.2% Fibonacci of 1297.

Summarizing, if the price continues to trade within the consolidation area in the near term, investors could be on hold until a break above 1290 or below 1266.

Bitcoin soared during the weekend, breaking the 7000 resistance level briefly and reaching one of the highest levels since last August. Despite there being negative fundamental news lately, with Binance being hacked and New York attorney general claiming there was a fraud of $850m in Bitfinex, the crypto continued its rally over the weekend. Analysts seem to associate Bitcoins rise with the current US-Sino uncertainty, yet we suspect that there may be more to it. Once again, no clear fundamental reasoning seems to rely behind the surge, but crypto investors currently seem to be dominated by the bulls. Bitcoin rallied over the weekend breaking the 6470 (S2) and the 6885 (S1) resistance lines (both turned to support). Despite a number of analysts maintaining a view that the crypto is about to hit a pause button and stabilise as it has reached the August 2018 levels, we suspect that the bulls may be just around the corner once again, should investor sentiment remain bullish. On the flip side please note that the RSI indicator in the daily chart has surpassed the reading of 70, implying a rather overcrowded long position. Should the crypto find fresh buying orders along its path, we could see it rising and breaking above the 7330 (R1) resistance line. Should Bitcoin come under the selling interest of the market, we could see it breaking the 6885 (S1) support line and aim for the 6470 (S2) support level.

Yen remains firm, while Aussie slips on US-Sino trade war.

Safe haven JPY remained rather firm against the USD yesterday as the US-Sino trade conflict seems to have no end. The negotiations between the two parties seem to have ended in a deadlock on Friday and it was indicative that analysts pointed out that the only positive point was that the two sides were still talking to each other. Currently the focus point seems to revolve around the US demand for changed in Chinese law and the Chinese refusal to swallow “any bitter fruit”, hurting their interests. In the long run, we expect the two sides to find a solution, yet we also expect a bumpy ride increasing volatility until then. Despite USD/JPY rising on Friday, during today’s Asian session, started the day with a negative gap remaining near the 109.75 (S1) support line. We could see the pair maintaining a sideways movement in the next days, as the market maintains a wait and see position for the Chinese response as well as any further escalation. Should the bears take over we could see the pair breaking the 109.75 (S1) support line aiming for the 109.15 (S2) support barrier. Should the bulls take over, we could see the pair breaking the 110.30 (R1) line.

Other economic highlights, today and early tomorrow

In the European morning, we get from Norway’s GDP data for Q1 as well as the Czech CPI rates for April. During tomorrow’s Asian session we get Japan’s current account balance for March.

As for the rest of the week:

On Tuesday, we get from the UK the employment data for March, from Germany the ZEW indicators for May and Eurozone’s industrial output for March. On Wednesday, we get Australia’s Wage pricesfor Q1, China’s industrial output and retail sales for April, Germany’s and Eurozone’s GDP for Q1, the US retail sales for April, Canada’s CPI rates for April and the US industrial output for April. On Thursday, we get Australia’s employment data for April and from the US the Philly Fed Business index for May. On Friday, we get Eurozone’s final CPI rate for April and from the US the preliminary Michigan consumer sentiment for May.

Bitcoin Daily

Support: 6885 (S1), 6470 (S2), 6000 (S3)
Resistance: 7330 (R1), 7775 (R2), 8250 (R3)

USD/JPY H4

Support: 109.75 (S1), 109.15 (S2), 108.50 (S3)
Resistance: 110.30 (R1), 110.90 (R2), 111.40 (R3)

• Trade tensions continue to simmer as China pushes back on US demands
• But two sides agree to hold more talks, keeping risk-off in check
• Safe-haven currencies such as the yen and the Swiss franc rise along with US government bonds

US threatens new tariffs as talks with China stall

US and Chinese negotiators failed to break the deadlock over trade in their talks last week as China refuses to change its laws to enact the reforms agreed in months-long negotiations. The White House’s chief economic advisor, Larry Kudlow, indicated on Sunday that any final deal would require China to sign up to “very strong” enforcement steps for the changes its agreed to.

Further piling the pressure on China were fresh threats by President Trump to impose additional tariffs on Chinese products. Trump instructed his administration on Friday to look into imposing duties on all remaining imports from China. However, China is still not budging, with officials saying, “no one should expect China to swallow bitter fruit that harms its core interests”.

The stand-off has raised the prospect of the ongoing trade war being even more protracted, which risks severely disrupting international trade and harming global growth at a time when many economies around the world are stuck in low gear mode.

Risk-assets slide, yen and Swiss franc shine

The safe havens yen and Swiss franc were the main winners on Monday as risk aversion prevailed in the markets. The Australian dollar was the biggest loser against the Japanese currency, slipping towards last week’s 4-month low of 76.34 yen. The US dollar also struggled, easing to 109.70 yen, though against a basket of currencies, the greenback was flat, with the dollar index trading around 97.35.

Traders also rushed into the Swiss currency amid the renewed worries about whether the US and China will be able to hammer out a trade agreement in the coming weeks. But optimism was in short supply, pushing the dollar to a 3½-week low of 1.0091 francs.

Equities started the week on the backfoot, with sharp losses recorded in Asia, while US stock futures pointed to Wall Street opening more than 1% lower today. The only good news from last week’s negotiations, and which is what’s preventing a more aggressive sell-off is the two sides agreeing to hold more talks.

However, with China yet to announce its own retaliatory measures against Trump’s decision to raise tariffs on $200 billion worth of Chinese imports from 10% to 25%, markets are on standby for further volatility in the coming days.

Quiet day ahead; Clarida speech eyed

Other than developments on the trade front, the rest of the day is looking relatively quiet. Investors will be watching a speech by Fed Vice Chairman, Richard Clarida at 13:10 GMT for any comments on the US economic outlook following the latest escalation in trade frictions. Remarks by the Bank of Canada’s Deputy Governor, Timothy Lane, may also attract attention as odds of a rate cut fell significantly after Friday’s much stronger-than-expected employment numbers for April.

The Canadian dollar jumped to a more than one-week high if C$1.3376 on the data before retreating slightly. Other majors were steady, with the euro marginally lower at $1.1228 and the pound flat at just above the $1.30 level.

The pound is being supported by Friday’s solid Q1 GDP figures even as cross-party talks to end the Brexit stalemate do not appear to be going anywhere. The latest reports are claiming UK PM, Theresa May, is planning to reopen talks with the EU on the declaration of the future relationship to secure changes that would appease the Labour party, suggesting there’s still a chance the two parties can reach a deal.

On trade negotiation with Japan, US Secretary of Agriculture Sonny Perdue warned that "we cannot continue to kick this trade can down the road forever." While a quick deal might be difficult, he said Trump is is really looking forward to a deal sooner rather than later".

Meanwhile, Perdue also said they're "very much aware of the elections of the upper body", in July in Japan. But he added, Trump is "expecting again Japan would treat us as their premier customer as we are."

EU Trade Commissioner Cecilia Malmström told newspaper Süddeutsche Zeitung that the deadline regarding US decision on auto tariffs on EU could be extended.

She recalled that "as long as we are in negotiations, no new tariffs will be imposed and we hope the US President will stick to them". Also, while the deadline for car tariffs decision in May 18, "the deadline can be extended... because of the negotiations between the US and China."

Though, Malmström reiterated the EU is prepared for any consequences. She pointed to the case of "Boeing and Airbus". She said, "we are prepared for the worst", and the retaliation list to US is ready.