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The single European currency appreciated about 108 base points against the Japanese Yen on Friday. The currency pair tested a resistance level formed by the monthly R1 at 126.69 during Friday's trading session.

The exchange rate consolidated below the resistance level during Monday's trading session. If the resistance line holds, the EUR/JPY currency pair will aim at a support cluster formed by the combination of the weekly pivot point and the 50-hour simple moving average at 126.06 within this session.

However, if the currency exchange rate passes the resistance level as mentioned earlier, the next target for bullish traders will be at 127.35.

The Australian Dollar appreciated about 73 base points against the US Dollar on Friday. The currency pair breached both the 50– and 100-hour SMAs during Friday's trading session.

Most likely, the currency exchange rate will move towards a support cluster formed by the combination of the 50– hour simple moving average and the weekly pivot point at 0.7153.

If the support level, as mentioned above holds, the AUD/USD exchange rate will continue its upside movement today.

Although, if the rate passes the support line, bears could drag the currency exchange rate lower during the following trading session.

The US Dollar depreciated about 82 base points against the Canadian Dollar on Friday. The currency pair tested the lower boundary of a junior ascending channel pattern at 1.3317 during Friday's trading session.

A breakout through the lower boundary of the junior ascending channel pattern could be expected within this session.

If the breakout occurs, the USD/USD exchange rate will aim for the weekly S1 at 1.3274 today.

However, if the junior channel holds, a surge towards the weekly R1 at 1.3388 could following during the following trading hours.

The New Zealand Dollar gained about 67 base points against the US Dollar on Friday. The currency pair breached the 50-, 100– and 200-hour SMAs during Friday's trading session.

However, today's trading session began with bearish sentiment, and by the middle of the European session, the currency pair has depreciated about 20 base points.

By and large, it is likely that the NZD/USD currency exchange rate will continue its southern movement. The potential downside targets for the pair will be at near a support cluster at 0.6755.

EUR/USD has started the week with small gains. Currently, the pair is trading at 1.1310, up 0.10% on the day. Last week, the pair climbed 0.7%, its best week since mid-March. It’s quiet on the fundamentals front, with no major events out of the eurozone. In the U.S., the Empire State manufacturing index is projected to jump to 8.0 in April. On Tuesday, Germany releases ZEW Economic Sentiment, with a forecast of 0.9 points.

U.S. inflation numbers showed improvement in March. CPI climbed to 0.4%, its highest gain since January 2018. The producer price index also looked strong, climbing 0.6%, a 5-month high. Inflation remains well below the Federal Reserve target of 2.0%, but stronger inflation numbers will bolster the case of Fed officials who favor raising rates in 2019 if the economic outlook improves. The Fed minutes from the March meeting left the door open to further rate hikes this year, but current market pricing suggests no hikes until 2020, and some analysts are expecting a cut in rates later this year.

The markets will be keeping a close eye on German ZEW economic sentiment, a key gauge of investor confidence. The indicator has been mired in negative territory for the past 12 months, but the scores have been improving. The April estimate stands at 0..9, which although not a strong gain, is symbolic for being in positive territory. If the indicator can meet or beat the forecast, the euro could respond with gains.

Notes/Observations

• Shortened trading week due to Easter holiday but plethora of key data before then (Tues: German ZEW Survey, China Q1 GDP; Thurs: Major European PMI data, US retail sales data)
• US corporate earnings season picking up through the week

Asia:

• US said to compromise on China state industrial subsidies to reach trade deal amid resistance from China. US may not make specific demands of China regarding the issue of subsidies for industrial companies.
• China PBoC Deputy Gov Chen Yulu reiterated China to further expand the opening up of its financial sector, urged the IMF to move forward with its quota and governance reforms

Europe:

• ECB's Draghi: the key message of the IMF meeting was that there would be a significant growth slowdown this year. Global recovery in 2020 was subject to significant risk. Had concerns about central bank independence including the most important jurisdiction in the world
• SNB's Jordan reiterated stance of seeing no reason to change our monetary policy; still willing to intervene if needed
• UK Cabinet Office Minister Lidington (de facto Dep PM) reiterated that would like Govt and Labour to agree on binding mechanism for way ahead; customs union compromises was still possible; Govt remained against second referendum
• S&P affirmed Germany sovereign rating at AAA; outlook Stable

Americas:

• IMF statement: global expansion continues but at a slower pace than was anticipated in Oct 2018; risks remain tilted to the downside
• President Trump: If the Fed had done its job properly, which it has not, the Stock Market would have been up 5000 to 10,000 additional points, and GDP would have been well over 4% instead of 3%...with almost no inflation. Quantitative tightening was a killer, should have done the exact opposite!
• Treasury Sec Mnuchin: imbalances must be addressed across Europe; US wanted to address trade imbalances
• Treasury Sec Mnuchin: expressed hope that both sides in US-China trade talks were re close to the final round of negotiations. Talks to be a very detailed agreement and would go way beyond bilateral investment treaty discussions. To have two more phone calls with Chinese Vice Premier Liu during week of Apr 15th

Energy:

• Russia Fin Min Siluanov: OPEC+ faced a dilemma with production cuts because of rising US production. Believed that oil prices could drop below $40/bbl for up to a year if OPEC+ partners stopped curtailing their output in any effort to fight for market share

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

• Indices [Stoxx600 +0.02% at 387.58, FTSE -0.05% at 7,433.25, DAX -0.05% at 11,994.40, CAC-40 +0.03% at 5,504.22, IBEX-35 +0.21% at 9,488.47, FTSE MIB +0.44% at 21,955.50, SMI +0.25% at 9,508.50, S&P 500 Futures -0.02%]
• Market Focal Points/Key Themes: European Indices trade little changed following a mixed session in Asia and flat futures in the US. On the corporate front shares of Bauer trades higher after a sharp rise in profits and strong guidance; Robert Walters also trades higher on a rise in net fee income. XP Power and Motif Bio are among the names trading lower on earnings. In other news IWG trades almost 20% higher following the divestiture of its Japanese operations; Ambu rises on reports the FDA updated on an investigation to evaluate the percentage of clinically used duodenoscopes, while PureTech gains on FDA clearance of Plenity. Elsewhere shares of Inficon, Pfeiffer Vacuum, Compass Group and Nokia are among the notable names declining after analyst downgrades. Looking ahead we will see a continuation of banking earnings with Citigroup, Goldman Sachs and M&T Bank all set to report.

Equities

• Consumer discretionary: Publicis [PUB.FR] +4.5% (earnings; acquisition), IWG [IWG.UK] +16% (divestment), Vivendi Universal [VIV.FR] +1% (earnings)
• Industrials: Daimler [DAI.DE] -1% (report on probe), Bauer [B5A.DER] +2% (earnings), Volkswagen [VOW3.DE] -0.5% (exec comments), Electricite de France [EDF.FR] +2% (France President Macron to support EDF nuclear operation re-nationalization), XP Power [XPP.UK] -1% (trading update)
• Materials: Nyrstar [NYR.BE] -51% (restructuring), Petra Diamonds [PDL.UK] -0.5% (trading update)

Speakers

• UK Foreign Min Hunt: Talks with Labour party have been more constructive than people think
• Czech Central Bank Lending Survey: Demand for loans in all segments declined in quarter
• Size of South Korea's extra budget to be decided during week of Apr 22nd
• China Commerce Ministry said to review anti-dumping measures on US DDGS (distillers dried grains with solubles)

Currencies/Fixed Income

• FX markets were quite subdued as the trading week began . currencies are calm on Monday as Easter recess approaches. The price action to experience a shortened trading week due to Easter holiday but plethora of key data before then to help percolate activity. (Tues: German ZEW Survey, China Q1 GDP; Thurs: Major European PMI data, US retail sales data)
• EUR/USD steady at 1.1310 with GBP/USD hovering around the 1.31 handle.

Economic Data

• (SE) Sweden Mar PES Unemployment Rate: 3.6% v 3.7% prior
• (PE) Peru Mar Unemployment Rate: 8.2% v 7.6% prior
• (PE) Peru Feb Economic Activity Index (Monthly GDP) Y/Y: 2.1% v 1.6% prior
• (DK) Denmark Mar PPI M/M: -1.3% v -0.2% prior; Y/Y: 2.0 v 3.0% prior
• (FI) Finland Mar CPI M/M: 0.1 v 0.5% prior; Y/Y: 1.1% v 1.3% prior
• (FI) Finland Feb Current Account Balance: €0.0B (nil) v €0.5B prior
• (FI) Finland Feb Final Retail Sales Volume Y/Y: 1.5 v 0.5% prelim
• (NO) Norway Mar Trade Balance (NOK): 13.9B v 15.2B prior
• (CH) Swiss Mar Producer & Import Prices M/M: 0.3% v 0.2%e; Y/Y: -0.2% v -0.3%e
• (IN) India Mar Wholesale Prices (WPI) Y/Y: 3.2%e
• (TR) Turkey Jan Unemployment Rate: 14.7% v 14.6%e
• (CH) Swiss Weekly Total Sight Deposits (CHF): 576.7B v 576.3B prior; Domestic Sight Deposits: 484.7B v 485.5B prior
• (PL) Poland Mar Final CPI M/M: 0.3% v 0.3% prelim; Y/Y: 1.7% v 1.7% prelim
• (IT) Italy Feb General Government Debt: €2.364T (record high) v €2.327T prior

Fixed Income Issuance

• (SK) Slovakia Debt Agency (Ardal) sold total €219M in 2028 and 2031 bonds

Looking Ahead

• (NG) Nigeria Mar CPI Y/Y: 11.2%e v 11.3% prior
• (TR) Turkey Mar Central Gov't Budget Balance (TRY): no est v -16.8B prior
• 05:30 (NL) Netherlands Debt Agency (DSTA) to sell €2.0-4.0B in 3-month and 6-month bills
• 05:30 (ZA) South Africa announces details of upcoming I/L bond sale (held on Fridays)
• 06:00 (IL) Israel to sell bonds
• 06:45 (US) Daily Libor Fixing
• 07:00 (IN) India announces details of upcoming bond sale (held on Fridays)
• 07:00 (BR) Brazil Apr FGV Inflation IGP-10 M/M: No est v 1.4% prior
• 07:25 (BR) Brazil Central Bank Weekly Economists Survey
• 07:30 (BR) Brazil Feb Economic Activity Index (Monthly GDP) M/M: -0.3%e v -0.4% prior; Y/Y: 2.9%e v 0.8% prior
• 08:00 (UK) Baltic Bulk Index
• 08:30 (US) Apr Empire Manufacturing: 8.0e v 3.7 prior
• 08:30 (US) Fed's Evans (dove, voter)
• 09:00 (FR) France Debt Agency (AFT) to sell combined €3.8-5.0B in 3-month, 6-month and 12-month Bills
• 09:00 (CA) Canada Mar Existing Home Sales M/M: +2.0%e v -9.1% prior
• 09:00 (BE) Belgium Feb Trade Balance: No est v -€1.3B prior
• 09:45 (UK) BOE to buy £1.15B in APF Gilt purchase operation (3-7 years)
• 10:30 (CA) Bank of Canada (BoC) Q1 Overall Business Outlook Survey: No est v 2.2 prior; Business Outlook Future Sales: No est v -1 prior
• 11:30 (IL) Israel Mar CPI M/M: 0.5%e v 0.1% prior; Y/Y: 1.4%e v 1.2% prior
• 11:30 (US) Treasury to sell 3-Month and 6-Month Bills
• 12:00 (UK) BOE's Haskel
• 12:30 (FR) ECB's Villeroy (France)
• 13:00 (US) Fed's Evans (dove, voter)
• 16:00 (US) Feb Net Long-term TIC Flows: No est v -$7.2B prior; Total Net TIC Flows: No est v -$143.7B prior

Futures on S&P500 exceeded 2900 and is only 1.2% below all-time highs. Meanwhile, we can mention now 3 bullish signs for EURUSD. Oil stuck to $71 as growth momentum was passed.

Stocks

The global market is growing. Futures on S&P500 exceeded 2900 and is only 1.2% lower than the historical highs reached at the end of September last year. Chinese China A50 reached its highs in 14 months and then declined amid profit-taking. Behind the growth of markets are optimistic expectations for the US and China trade deal, the shift of the Brexit date and the improvement in data from China last week.

EURUSD

Improving Chinese statistics helped the single currency to get a new portion of support from 1.1200. On the technical analysis side, the single currency enjoys several positive signals that tune it to further growth. Firstly, it is the strengthening of purchases in the process of decline to 1.1200. Secondly, growth above 1.1300 allows speaking about breaking the resistance of the downward trend from the beginning of the year. Thirdly, the pair has been trading above the 50-day moving average since the beginning of the week, which also strengthens purchases from participants closely following medium-term trends.

GBPUSD

The British currency cautiously grows after European lawmakers allowed Britain to remain in the EU until the end of October, with the possibility of further delay. This news took away some of the risks against the chaotic Brexit, reducing the pressure on GBP. Growth in stock markets supports buying, raising GBPUSD to 1.3100. As in the case of EURUSD, the pair is trading near the 50-day moving average, consolidating above this level can provide an increase in purchases.

Brent

Oil got stuck around $71 per barrel of Brent, losing growth momentum from the second half of last week. It is alarming that oil does not show growth in conditions of increasing optimism in the markets. In addition, data on the number of working drilling rigs in the United States again showed a decline, which usually acts as a factor of prices support, but not this time. It seems that this growth impulse is exhausted. An important technical impulse indicator - RSI - fell below 70, returning from the overbought area. This is often followed by increased pressure.

Bitcoin

Bitcoin starts the week with a gain of around 2.5% to $5180, receiving support after a short-term decline below $5,000. The market has settled, and now it may be ready for the next sharp movements. Cautious buying after a downturn to $5,000 feed hopes for a return to a positive trend. Among the important levels that can turn into increased volatility, you should pay attention to $5,200 (MA200) and previous highs at $5417.

Cable ticked higher on Monday but remains directionless and in range trading that extends into sixth straight day.

Near-term action remains capped by daily cloud top (1.3115) which marks key resistance along with Fibo barrier at 1.3131 (38.2% of 1.3381/1.2977).

Flat daily indicators add to neutral mode, but absence of news from Brexit is the main obstacle.

Releases of Key UK data are in focus this week with jobs/earnings data are due tomorrow, inflation on Wednesday and retail sales on Thursday.

Data could generate fresh direction signals in holiday-shortened week with lower volumes.

Sustained break above cloud top / Fibo barrier would generate bullish signal for recovery extension towards targets at 1.3179/96 (50% retracement / 3 Apr high), while close below 1.3030/40 zone (base of recent range) would weaken near-term structure and expose key support at 1.2974 (200SMA).

Res: 1.3115, 1.3131, 1.3179, 1.3196
Sup: 1.3069, 1.3042, 1.3030, 1.2974

The AUD/USD has formed a bullish zigzag right in the middle of an uptrend move which could expand even further.

0.7135-45 is the POC zone where we see a strong confluence of both now moment and historical bulls. It is additionally supported by an ascending trendline. Targets are 0.7199 and 0.7228. Have in mind that 1h/4h close is needed above 0.7200 for the price to continue with a bullish momentum. Only a drop below 0.7110 might lead to a pure neutral price action while bears have nothing to look for above 0.7065.

A four-week descending channel pattern has guided the common European currency towards January 31 low level at 1.5717 against the Australian Dollar. The currency pair declined by 0.64% in value during last week's trading sessions.

As for the near future, it is likely that the EUR/AUD currency exchange rate will continue to maintain the four weeks descending channel pattern. Bearish traders could push the pair towards the bottom border of a dominant ascending channel at 1.5653.

However, a support cluster formed by the combination of the weekly and the monthly PPs at 1.5698 could provide support for the rate in the shorter term.