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Ethereum is under downside pressure on Friday, with the second largest cryptocurrency falling below major weekly technical support. The ETHUSD pair has failed to gain bullish momentum this week and has so far found support from the $145.00 level. The bearish head and shoulders pattern on the four-hour time frame remains key, with the ETHUSD pair now trading below neckline support, at $155.00.

If the ETHUSD pair trade below the $155.00 level, key support found at the $145.00 and $125.00 levels.

If the ETHUSD pair trades above the $155.00 level, key resistance is found at the $165.00 and $179.00 levels.

The euro currency has suffered another bearish daily price close against the US dollar, with the pair so far finding weekly support from the 1.1116 level. If the EURUSD pair breaks the 1.1116 level the 1.1100 level now offers the strongest form on intraday support. If the EURUSD pair corrects higher, the 1.1175 level is now key upside technical resistance on an intraday basis.

The EURUSD pair is intraday bearish while trading below the 1.1175 level, key technical support is found at the 1.1116 and 1.1100 levels.

If the EURUSD pair trades above 1.1150 level, key intraday resistance is found at the 1.1175 and 1.1200 levels.

Daily Pivots: (S1) 1.1347; (P) 1.1368; (R1) 1.1381; More...

EUR/CHF's break of 1.1365 minor support suggests short term topping at 1.1476, after being rejected by 38.2% retracement of 1.2004 to 1.1162 at 1.1484. Intraday bias is turned back to the downside for 55 day EMA (now at 1.1324). Sustained break will bring deeper decline to retest 1.1162 low. On the upside, break of 1.1484 fibonacci resistance will confirm completion of corrective fall from 1.2004. Further rally should then be seen to 61.8% retracement at 1.1682 and above.

In the bigger picture, focus is back on 1.1444 resistance with current rebound. Decisive break there will indicate completion of the decline from 1.2004, with support from 61.8% retracement of 1.0629 to 1.2004 at 1.1154. In this case, further rise should be seen to 1.1713 resistance next. On the downside, firm break of 61.8% retracement of 1.0629 to 1.2004 at 1.1154 is now needed to confirm down trend resumption. Otherwise, medium term outlook will be neutral at worst.

The US dollar is coming under pressure against the Japanese yen currency following a fake technical breakout above the 112.00 level. The intraday sentiment towards the USDJPY pair remains bearish while price trades below the 111.60 support level. Overall, the next large directional move in the USDJPY is likely to come after the release of first quarter GDP from the US economy later today.

The USDJPY pair is only bullish while trading above the 111.60, key intraday resistance is found at the 112.00 and 112.40 levels.

If the USDJPY pair trades below the 111.60 level, key intraday support remains at the 111.30 and 111.10 levels.

The Japanese yen weakened against the USD after the country released key data. In March, the unemployment rate rose to 2.5% from 2.3% in February. Investors were expecting it to rise to 2.4%. In the month, the industrial production declined by minus 0.9% from the previous gain of 0.7%. On a positive note, the retail sales rose by 1% while the Tokyo CPI rose by an annualized rate of 1.4%. The core CPI rose by 1.3%. These numbers came a day after the Bank of Japan (BOJ) gave forward guidance on when it expects to raise interest rates.

Today, the focus will be on the greenback as the US releases its first reading of the Q1 GDP numbers. Investors expect that the economy grew by 2% in the quarter. This will be lower than the fourth quarter’s GDP growth of 2.2%. However, such a reading will be good considering that in the quarter, there was the longest government shutdown in history. Investors will also receive core PCE data, which is expected to have risen by 1.3%. This data will come as the US dollar strength continues. The dollar index is currently at the highest level in more than one year.

The Australian dollar rose slightly against the USD. This is after the country released the Producer Purchasing Index (PPI) for the first quarter. In the quarter, the PPI rose by an annualized rate of 1.9%, which was lower than the expected 2.0%. On a QoQ basis, the PPI rose by 0.4%, which was unchanged from the previous quarter. The PPI number measures the change in price of goods sold by manufacturers and is an important measure of inflation. Early this week, the country’s CPI data was much lower than expected.

EUR/USD

The EUR/USD pair was relatively unmoved ahead of the key GDP number from the US. It is now trading at 1.1135, which is slightly higher than yesterday’s low of 1.1117. On the hourly chart, the pair’s price is below the 50-day and 25-day moving averages. The RSI has moved up slightly to the current level of 43, while the volumes have declined. The pair will likely remain along these levels ahead of the GDP numbers. This is because there will be no major data from Europe before then.

USD/JPY

The USD/JPY pair moved up to a high of 111.78 after the Japanese data, it then pared some of those gains and is currently trading at 111.64. On the 30-minute chart, the pair’s price is along the middle line of the Bollinger Bands. The signal line of the MACD has been rising and is close to crossing the neutral line while the volumes have declined. Like with the EUR/USD, the pair will likely remain along these levels as traders wait for the US GDP data.

AUD/NZD

After reaching a high of 1.0733 this week, the AUDNZD pair has been declining. Today, the pair reached an intraday low of 1.0560, which was the lowest level since Wednesday this week. On the four-hour chart, the pair is trading below the 25-day and 50-day moving averages, while the RSI is at the oversold level of 21. The price is also along the 61.8% Fibonacci Retracement level. There is a likelihood that the pair will continue moving upwards to test the 50% Fibonacci level of 1.0500.

• Rates: Temporary relief from US Q1 GDP data?
  Core bonds lacked inspiration yesterday, but that will change today with US Q1 GDP up for release. Bond markets are positioned to take some more bad news. However, we deem the bar of consensus (2.3% Q/Qa) rather low which could be the cue for some short term profit taking. Longer term, we hold our upward bias for bonds.
• Currencies: Dollar remains in driver's seat ahead of US Q1 GDP release
  The dollar touched the highest level in almost two years yesterday, but the rally took a breather after mixed US eco data. Today, the focus for USD trading is on the US Q1 GDP release. A solid report might confirm the US economic outperformance compared to most other major developed countries and support the USD positive momentum.

The Sunrise Headlines

• US stock markets closed mixed yesterday after staging an intraday comeback. The Dow Jones (-0.51%) underperformed. Asian equities mostly trade in negative territory. Korea is underperforming.
• Trump's top economic adviser Larry Kudlow thinks the Fed is moving towards rate cuts, saying the “funds rate has traded a bit high”. Kudlow also said that US Q1 growth, published later today, “may be very close to 3%”.
• President Xi Jinping reiterated that China won't engage in currency depreciation. He pledged to keep the yuan stable and wants markets to play a bigger role in setting the exchange rate. The yuan strengthened (6.73 USD/CNY).
• April inflation in Japan (Tokyo CPI) beat expectations with headline CPI at 1.4% (vs. 1.1% expected) and core measures coming in at 0.9% (vs. 0.7%). Retail sales in March matched consensus but industrial production was very disappointing.
• The ECB's vice president de Guindos isn't very optimistic on the EMU economy but expects the forces that were behind the 2018 slowdown will ebb, adding however that QE can be used again if required.
• Argentina's former leftist president Fernández is gaining traction in the presidential election polls. Although no official candidate yet, markets' fear over potential interventionist policies sent the Argentine Peso to a record low.
• Today's economic calendar is thin yet important as markets will closely watch US GDP numbers for the first quarter this year. Investors expect Q1 growth at 2.3% QoQ (annualized), slightly up from 2.2% in 2018Q4.

Currencies: Dollar Remains In Driver's Seat Ahead Of US Q1 GDP Release

Dollar remains in the driver's seat

The (trade-weighted) dollar touched the highest level in almost two years early in US dealings yesterday. EUR/USD developed a similar pattern as the pair tested the 1.1119 support. However, US investors finally turned a bid more cautious. US data were mixed with solid durable goods orders but at the same time an unexpected uptick in jobless claims. It is too early to draw conclusions from a weekly claims release, but the report maybe inspired some ST USD profit taking after recent rally. US equities also struggled as corporate earning brought a balanced/mixed outcome. EUR/USD closed at 1.1132 (from 1.1155). The loss in USD/JPY was even bigger with a close at 111.63 (from 111.19).

Asian equities mostly show modest losses this morning. Japan March production data (-0.9% M/M) raised questions on the countries' growth. At the same time, Tokyo CPI printed slightly higher than expected. USD/JPY hovers in the 111.65 area as Japanese markets prepare for the Golden Week holidays. The yuan gained a few ticks in a daily perspective (USD/CNY 6.7350 area) as the Chinese president reiterated China doesn't intend a weakening of its currency that harms other nations. EUR/USD (1.1135 area) is holding within reach of yesterday's low.

Today, there are again few data in EMU except for the French consumer confidence. The focus for FX/USD trading will be on the US Q1 GDP. The market expects 2.3% annualised growth. This level looks feasible and might convince markets that the US economy avoids a big slowdown. A report in line or better than expected might support recent USD positive momentum.

Poor EMU data (PMI's) last week pushed EUR/USD to the low 1.12 area. At the same time, the dollar is supported by relative resilience of the US economy. These trends finally pushed EUR/USD below the 1.1177 MT range bottom. We expect any further USD gains to develop in a gradual way. Even so, there is no reason to row against the USD positive tide. Next support at 1.1110/19 (May/June 2017 lows) is within reach.

Sterling showed no clear trend yesterday. EUR/GBP still felt some modest negative spill-overs from EUR/USD. The pair closed at 0.8631 (from 0.86644). Even so, the Brexit process still provides little support for sterling. The negotiations between the conservative party and labour to reach a compromise on Brexit look to have stalled and it looks ever more likely that the UK will have to participate in the May EU elections. Euro and sterling weakness might keep each other in balance short-term.

EUR/USD: nearing the 1.1111/19 support area

Market movers today

In the US, we get the first estimate of GDP growth in Q1 today. We expect to see a more or less unchanged GDP number for Q1 relative to Q4, 2018. However, a lower than expected number will add to the downward pressure on US Treasuries as political pressure for a rate cut will increase.

Today the Bank of Russia (CBR) will announce its monetary policy meeting decision on the key rate. In line with Bloomberg and Reuters consensus, we expect the CBR will keep the key rate unchanged at 7.75%. A softened ECB and Fed stance offers more room for the CBR to start cutting soon. We expect two 25bp cuts in 2019.

Italy and Greece up for review by S&P today. See more on page 2.

In Sweden , March PPIs and retail sale numbers are released today (see page 2).

Selected market news

French president Emmanuel Macron held a more than two hour long press conference yesterday, in which he promised cuts of EUR 5bn in personal income taxes, inflation indexing of monthly pensions below EUR 2,000 and no further closures of hospitals and schools for the remaining part of his term in a bid to stop the gilets jaune riots. While details of the plan did not become known until after close of the European session, expectations weighed on semi core and periphery throughout the day. French 10Y yields widened 2bp to Bunds and 10Y BTP widened 5bp.

US treasuries sold off early in the session yesterday after initially seeing surprisingly strong data on durable goods, but weaker earnings reports than recent days and an increase in initial jobless claims meant that treasuries ended the day up just 2bp. S&P500 was only little changed. Remaining in the US the effective Fed Funds rate (EFFR) fixed high for the fourth consecutive day at 2.44% - 6bp below the upper bound of the target range, but an entire 4bp above the IOER. While the EFFR has traded closer to the upper bound in the past, this has happened with the IOER only 5bp below the upper bound. The difference of 4bp has not been seen since back in 2008 when the facility was first introduced. While excess reserves remain large in a historical context, implementation of liquidity requirements is said to have pushed up structural demand for excess reserves. The high fixing has prompted speculations of an early end to the balance sheet run-off (currently set to end in September) and even a downward adjustment of the IOER.

According to a government official, British Prime Minister Theresa May has lost the race to avoid UK elections for the European Parliament on 23 May as the Brexit Bill probably won't come to the floor next week, and after which there is too little time to carry out a ratification of a potential agreement. According to the official the next target will be to have the bill passed by June 30 where the newly elected MEPs take seat in the Parliament.

General Trend:

• Japanese financials decline amid recent earnings from Nomura
• Nintendo declines on Switch device guidance
• Japanese companies due to report earnings after the market close include Sony, Komatsu and Hitachi
• Consumer Discretionary and property shares are among the decliners in Shanghai; Air China drops following earnings
• Australia's Flight Centre declines over 11% on profit warning
• Intel weighs on Asian chipmakers
• Intel declines over 7%, guided Q2 results below consensus
• Amazon trades flat in the afterhours following earnings/guidance
• PBoC skipped reverse repo for 5th consecutive session, continues to drain liquidity
• Japan's March industrial production and unemployment rate disappoint
• Tokyo April Core CPI hits the highest level since 2015
• New Zealand reports record exports in March on dairy products and China
• Aussie Q1 export prices beat ests on iron ore
• Japan PM Abe expected to meet US President Trump on Friday, trade expected to be on the agenda
• Japan's Golden Week holiday is approaching. Japan's exchanges are due to be closed between April 27 (Saturday) to May 6th (Monday)

Headlines/Economic Data

Australia/New Zealand

• ASX 200 opened -0.1%
• (AU) AUSTRALIA Q1 IMPORT PRICE INDEX Q/Q: -0.5% V 0.4%E; EXPORT PRICE INDEX Q/Q: 4.5% V 3.5%E
• (AU) AUSTRALIA Q1 PPI Q/Q: 0.4% V 0.5% PRIOR; Y/Y: 1.9% V 2.0% PRIOR
• (NZ) New Zealand Mar Trade Balance (NZ$): 922M v 131Me (highest since Apr 2011)
• (NZ) New Zealand Apr Consumer Confidence: 123.2 v 121.8 prior

China/Hong Kong

• Shanghai Composite opens -0.5%, Hang Seng -0.1%
• (US) Reportedly China offers 8 years of IP protections for biologics data (vs 12 years under current US law); US considers concession on drug protections – press
• (CN) CNBC's Javers: "President Trump just told a group of kids: 'We will soon be having President Xi from China coming' to the White House. BUT aides don't have any information to back that up - telling me 'We don't have anything to announce.'"
• (CN) China President Xi: Reiterates won't pursue yuan depreciation that harms others
• (CN) China PBoC Open Market Operation (OMO): Skips reverse repo operations for 5th consecutive session: Net: CNY20B drain v CNY80B drain prior
• (CN) China PBoC sets yuan reference rate: 6.7307 v 6.7307 prior
• (CN) Banks in Hangzhou City said to lower home mortgage interest rates - financial press

Japan

• Nikkei 225 opened -0.6%
• (JP) Japan Fin Min Aso: not in favor of linking currency talks with trade talks, we did talk about currency for ~5 minutes; confirmed that we will discuss currency; Yen movement has not impacted trade - comments after talking with Mnuchin
• (JP) Japan Trade Min Motegi: Confirms meetings with USTR Lighheizer; believes it is difficult to come to result this week; No talk of export volume restriction from US on autos
• (JP) BOJ Senior Official: Monetary easing aimed at achieving price target, not at FOREX; natural for monetary policy to vary from country to country
• (JP) Japan Mar Preliminary Industrial Production M/M: -0.9% v 0.0%e; Y/Y: -4.6% v -3.8%e
• (JP) JAPAN MAR JOBLESS RATE 2.5% V 2.4%E
• (JP) Japan Mar Preliminary Retail Sales M/M: 0.2% v 0.0%e; Y/Y: +1.0% v 0.8%e
• (JP) Japan Apr Tokyo CPI Y/Y: 1.4% v 1.1%e; CPI Ex-Fresh Food Y/Y: 1.3% v 1.1%e (highest since 2015)

Korea

• Kospi opened -0.6%
• (KR) Bank of Korea Gov Lee: Does not expect negative growth will continue, domestic economy in difficult situation
• (KR) South Korea Apr Consumer Confidence 101.6 v 99.8 prior (highest reading since Sept 2018)

North America

• (US) White House reportedly pushing for quick action to raise debt ceiling - Wash Post
• (US) White House Econ Adviser Kudlow: Sees Fed moving towards a rate cut - Interview

Levels as of 1:20 ET

• Nikkei 225, -0.4%, ASX 200 flat, Hang Seng +0.2%; Shanghai Composite -0.2%; Kospi -0.6%
• Equity Futures: S&P500 -0.1%; Nasdaq100 flat, Dax flat; FTSE100 +0.1%
• EUR 1.1142-1.1124 ; JPY 111.78-111.44 ; AUD 0.7032-0.7002 ;NZD 0.6646-0.6615
• Gold +0.2% at $1,281/oz; Crude Oil -0.6% at $64.83/brl; Copper +0.5% at $2.875/lb

For the 24 hours to 23:00 GMT, the EUR declined 0.15% against the USD and closed at 1.1137.

The US dollar gained ground against a basket of currencies, amid robust US capital goods orders data.

In the US, data indicated that preliminary durable goods orders rebounded 2.7% on a monthly basis in March, hitting a 7-month high level, amid weaker growth of industrial sector. Durable goods orders had registered a drop of 1.6% in the previous month, while market participants had expected for a rise of 0.8%. Meanwhile, the nation’s seasonally adjusted initial jobless claims advanced to a level of 230.0K in the week ended 20 April 2019, rising by the most in 19-months and compared to market expectations of a gain to a level of 200.0K. In the previous week, initial jobless claims had registered a revised reading of 193.0K.

In the Asian session, at GMT0300, the pair is trading at 1.1138, with the EUR trading slightly higher against the USD from yesterday’s close.

The pair is expected to find support at 1.1117, and a fall through could take it to the next support level of 1.1095. The pair is expected to find its first resistance at 1.1161, and a rise through could take it to the next resistance level of 1.1183.

Amid lack of economic releases in Canada today, traders would focus on the US gross domestic product annualised and personal consumption, both for the first quarter of 2019, along with the Michigan consumer sentiment index for April, scheduled to release later in the day.

The currency pair is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the GBP marginally declined against the USD and closed at 1.2900, after UK Prime Minister, Theresa May, and opposition Labour Party failed to reach to an outcome over Brexit.

On the data front, UK's CBI business optimism improved to a level of -16 in April, following a level of -23 in the preceding month.

In the Asian session, at GMT0300, the pair is trading at 1.2901, with the GBP trading a tad higher against the USD from yesterday's close.

The pair is expected to find support at 1.2872, and a fall through could take it to the next support level of 1.2844. The pair is expected to find its first resistance at 1.2923, and a rise through could take it to the next resistance level of 1.2946.

Trading trend in the Sterling today is expected to be determined by UK's BBA loans for house purchase for March, set to release in a few hours.

The currency pair is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.