Sample Category Title

Daily Pivots: (S1) 1.2975; (P) 1.3048; (R1) 1.3110; More....

Intraday bias in GBP/USD remains neutral and consolidation from 1.3381 could extend. Further rise is still mildly in favor as long as 1.2960 support holds. On the upside, decisive break of 1.3381 will extend the rise from 1.2391 and target 61.8% retracement of 1.4376 to 1.2391 at 1.3618 next. However, on the downside, sustained break of 1.2960 will indicate that rebound from 1.2391 has completed earlier than expected. Deeper fall would then be seen to 1.2773 support for confirmation.

In the bigger picture, medium term decline from 1.4376 (2018 high) should have completed at 1.2391. Rise from 1.2391 is seen as the third leg of the corrective pattern from 1.1946 (2016 low). Further rise could be seen through 1.4376 in medium term. On the downside, though, break of 1.2773 support will dampen this view. Focus will be turned back to 1.2391 low and break will resume the fall from 1.4376 to 1.1946.

Daily Pivots: (S1) 0.9986; (P) 0.9999; (R1) 1.0017; More...

Intraday bias in USD/CHF remains neutral at this point. On the upside, sustained break of 1.0010 will suggest that pull back from 1.0124 has completed. Intraday bias will be turned back to the upside for 1.0124/28 resistance zone. However, break of 0.9953 minor support will indicate rejection by 1.0010 and turn bias to the downside for 0.9879. Break there will resume the fall from 1.0124 to 0.9716 key support.

In the bigger picture, focus is back on medium term trend line (now at 0.9865). Decisive break there will argue that whole rise from 0.9186 has completed. Further break of 0.9716 will confirm reversal and target next support level at 0.9541. Nevertheless, there is still a chance that price action from 1.0128 are forming a consolidative pattern with fall from 1.0124 as third leg. If this is the case, stronger support should be seen between 0.9716 and the trend line to contain downside.

GBP/USD declined heavily after it failed to break the 1.3200 resistance area. EUR/GBP is correcting lower, but dips remain supported near the 0.8580 area.

Important Takeaways for GBP/USD and EUR/GBP

• The British Pound failed to break the 1.3200 resistance and declined heavily below 1.3120.
• There was a break below a key bullish trend line with support at 1.3065 on the hourly chart of GBP/USD.
• EUR/GBP climbed higher recently above the 0.8550 and 0.8600 resistance levels.
• There was a break above a major bearish trend line at 0.8565 on the hourly chart.

GBP/USD Technical Analysis

The British Pound made a couple of attempts to break the 1.3200 resistance area against the US Dollar, but it failed. The GBP/USD pair started a downward move and broke the 1.3120 and 1.3080 support levels.

The pair even broke the 1.3060 support and the 50 hourly simple moving average. It revisited the main 1.3000 support area, where buyers emerged. Besides, there was a break below a key bullish trend line with support at 1.3065 on the hourly chart of GBP/USD.

A swing low was formed at 1.2985 on FXOpen before the pair started a decent upside correction. It climbed above the 1.3020 and 1.3050 resistance levels.

There was also a break above the 50% fib retracement level of the recent decline from the 1.3121 high to 1.2985 low. However, the pair is now approaching a crucial resistance area near the 1.3080 level and the 50 hourly SMA.

Besides, the 76.4% fib retracement level of the recent decline from the 1.3121 high to 1.2985 low is also near the 1.3090 level to act as strong resistance. Therefore, a break above the 1.3080 and 1.3090 resistance levels is must for buyers to gain control in the near term.

If there is now upside break above the 1.3080 or 1.3090, the pair is likely to start a fresh decline towards the 1.3040 or 1.3020 support levels.

EUR/GBP Technical Analysis

The Euro formed a strong support base near the 0.8500-0.8510 zone against the British Pound. The EUR/GBP pair started a fresh increase and moved above the 0.8550 and 0.8600 resistance levels.

The pair even settled above the 0.8560 level and the 50 hourly simple moving average. Moreover, there was a break above a major bearish trend line at 0.8565 on the hourly chart.

Buyers pushed the price above the 0.8620 level and a swing high was formed near 0.8636 before the pair started a downside correction. The pair recently corrected below the 0.8620 level and the 50% fib retracement level of the last wave from the 0.8557 low to 0.8636 high.

However, the pair is now approaching a solid support above the 0.8580 level. The 61.8% fib retracement level of the last wave from the 0.8557 low to 0.8636 high is also near the 0.8585 zone.

Therefore, dips towards the 0.8580 level and the 50 hourly SMA are likely to find a strong buying interest in the near term. Below 0.8580, the next key support is near the 0.8550 level.

On the upside, EUR/GBP could face resistance near the 0.8615 level, above which the pair is likely to revisit the 0.8635 level in the near term. The next major hurdle above 0.8635 is at 0.8650.

Daily Pivots: (S1) 111.60; (P) 111.71; (R1) 111.83; More...

USD/JPY's dip today suggests temporary topping at 111.82 again and intraday bias turns neutral. Another rise is mildly in favor as long as 111.18 minor support holds. On the upside, decisive break of 112.13 will resume whole rally from 104.69 and target 114.54 resistance next. However, on the downside, break of 111.18 will likely extend the consolidation from 112.13 with another fall to 109.71 and possibly below, before completion.

In the bigger picture, medium term outlook in USD/JPY remains a bit mixed as it's staying inside falling channel from 118.65, but there are signs of bullish reversal. On the upside, break of 114.54 resistance will revive the case the corrective fall from 118.65 has completed with three waves down to 104.69. And whole rise from 98.97 (2016 low) is resuming for 118.65 and above. But before that, outlook stays neutral first.

Yen recovers notably in Asian session today but the recovery is not strong enough to warrant a sustainable rebound yet. Meanwhile, Australian and New Zealand Dollar are generally pressured while there is no apparent sign of risk aversion. The economic calendar is not particular busy today with some second-tier data only. It may take more time for the markets to unfold the direction for the week.

The US-China trade negotiation last week ended with "guarded optimism" from White House economic adviser Larry Kudlow, without details of course. Focus is back on never-ending Brexit drama as April 12 deadline looms. EU-China summit in Brussels might catch some attentions but expectations are low. ECB meeting, US CPI and FOMC minutes will be more interesting to watch.

Technically, Dollar is turning slightly softer again today. EUR/USD is held comfortably above 1.1176 key support so far. And recovery could put focus back to 1.1273 minor resistance. Break will confirm short term bottoming. USD/JPY could also be heading to 111.18 minor support. Break will indicate rejection ahead of 112.13 resistance and suggest near term reversal. USD/CHF also bounced from 1.0010 minor resistance, which could prompt more selling.

Elsewhere, in Asia, Nikkei is down -0.17%. Hong Kong HSI is up 0.29%. China Shanghai SSE is down -0.09%. Singapore Strait Times is down -0.28%. Japan 10-year JGB yield is down -0.0136 at -0.043.

Labour said May didn't move an inch on Brexit red lines, while May urged compromises

Timing is ticking for the UK as April 12 Brexit day is approaching quickly. The talks between Prime Minister Theresa May and Labour leader Jeremy Corbyn yielded no results so far. Labour's top legal policy chief Shami Chakrabarti complained that May has not moved "an inch" on her "red lines". And, "it's hard to imagine that we are going to make real progress now without either a general election or a second referendum on any deal she can get over the line in parliament."

May, on the other hand, said in a video, apparently shot by shaky hands, that "ending free movement, ensuring we leave with a good deal, protecting jobs, protecting security" are things the Conservatives and Labour could agree on. And, she added "it'll mean compromise on both sides" but "delivering Brexit is the most important things for us".

With no cross-party agreement in sight yet, May would need EU's approval on her request for extension until June 30 to avoid a no-deal Brexit. Comments from EU officials suggested that they're against another short extension with no clear and substantial developments in UK. Even the idea of "flextension" was not accepted by all. Some expected that the most likely outcome of the EU summit this week is for May to come out with a long extension. But that will very likely infuriate hard-line Brexiteers in the Conservative Party.

BoJ Kuroda: Core CPI to gradually accelerate toward 2 percent

BoJ Governor Haruhiko Kuroda maintained his view on the economy in a speech at a quarterly meeting of regional branch managers. He said Japan's economy was expected to continue expanding moderately, even though slowdown overseas is affecting exports.

Also, "core consumer inflation is expected to gradually accelerate toward 2 percent as the output gap remains positive, and medium- to long-term inflation expectations heighten."

But for now, BoJ will continue to expand monetary base until consumer inflation exceeds 2% target stably. And, short- and long-term interest rates will be kept at current very low levels for an extended period of time.

WH Kudlow has guarded optimism on China trade talks

In a CBS interview aired on Sunday, White House economic adviser Larry Kudlow said trade negotiations with China got "closer and closer". He hailed that "we made good headway last week when Vice Premier Liu He was here." And talks will continue this week with "a lot of teleconferencing". He also added "a lot of very difficult topics for the first time are on the table and being resolved". He has "guarded optimism, may- maybe more than guarded optimism so we're- we're gaining on it."

Kudlow also said "great progress" was made on intellectual property theft. And "good progress" was made on "the forced transfer of technology, on the ownership." But there are still "issues outstanding" including "enforcement related issues".

But he emphasized: "In each and every place, (A) they've acknowledged their problems. That was a very big hurdle. And (B) what wasn't on the table is on the table, and (C) we're getting closer and closer."

Low expectations on EU-China summit in Brussels this week

Chinese Vice Premier Li Keqiang will meet top EU officials in a summit in Brussels on Tuesday. Ahead of that Li wrote in German newspaper Handelsblatt, saying that China was ready to work closely with the EU on climate change, sustainable development, preserving the Iran nuclear deal and fighting terrorism. But China is only willing to exchange views on WTO reforms.

EU, on the other hand, is said to known to be concerned with the unfair trade practices with this systemic rival. In particular, there is no binding commitments from China in key areas, including inclusion of state subsidies on enterprises as part of WTO reforms. And European Council President Donald Tusk was said as objecting to a joint statement for the summit, as China has not delivered on key EU expectations and demands.

The expectations on the summit are generally low.

ECB, US CPI and FOMC Minutes to highlight the week

The most important events are scheduled for Wednesday this week. ECB will keep monetary policies unchanged, without a doubt. There shouldn't be any chance in ECB's plan on monetary policy too. That is, it will keep interest rates unchanged at least through the end of 2019. Details regarding the TLTRO III should be released later in June, rather than at this meeting.

Though, markets might be eager to know more on two topics. Firstly, March meeting minutes revealed that some members indeed favored to extend forward guidance until first quarter of 2020. President Mario Draghi would be asked to elaborate more on the discussions. Secondly, members' comments over the past weeks have given rise to the possibility of a move to a "tiered deposit rate" system in order to save bank profitability.

US CPI and FOMC minutes will also be featured on Wednesday. Fed turned rather dovish at March meeting. Most importantly, members now project no rate hike in 2019 and just one in 2020. Also, the balance sheet run-off plan will end in September. The minutes will likely reveal more details on the the reasons behind the changes, as well as the balance of hawks and doves in the committee.

Here are some highlights for the week:

• Monday: Japan current account, consumer confidence; Germany trade balance; Eurozone Sentix investor confidence; Canada housing starts, building permits; US factory orders.
• Tuesday: Australia home loans; Swiss unemployment rate; UK BRC retail sales monitor.
• Wednesday: Japan PPI, machine orders, machine tool orders; Australia Westpac consumer sentiment; UK GDP, productions, trade balance; ECB rate decision; US CPI, FOMC minutes.
• Thursday: China CPI, PPI; Japan M2; UK RICS house price balance; Germany CPI final; Canada new housing price index; US PPI, jobless claims.
• Friday: New Zealand BusinessNZ manufacturing index; China trade balance; Eurozone industrial production; US import prices, U of Michigan sentiments.

USD/JPY Daily Outlook

Daily Pivots: (S1) 111.60; (P) 111.71; (R1) 111.83; More...

USD/JPY's dip today suggests temporary topping at 111.82 again and intraday bias turns neutral. Another rise is mildly in favor as long as 111.18 minor support holds. On the upside, decisive break of 112.13 will resume whole rally from 104.69 and target 114.54 resistance next. However, on the downside, break of 111.18 will likely extend the consolidation from 112.13 with another fall to 109.71 and possibly below, before completion.

In the bigger picture, medium term outlook in USD/JPY remains a bit mixed as it's staying inside falling channel from 118.65, but there are signs of bullish reversal. On the upside, break of 114.54 resistance will revive the case the corrective fall from 118.65 has completed with three waves down to 104.69. And whole rise from 98.97 (2016 low) is resuming for 118.65 and above. But before that, outlook stays neutral first.

Economic Indicators Update

In a CBS interview aired on Sunday, White House economic adviser Larry Kudlow said trade negotiations with China got "closer and closer". He hailed that "we made good headway last week when Vice Premier Liu He was here." And talks will continue this week with "a lot of teleconferencing". He also added "a lot of very difficult topics for the first time are on the table and being resolved". He has "guarded optimism, may- maybe more than guarded optimism so we're- we're gaining on it."

Kudlow also said "great progress" was made on intellectual property theft. And "good progress" was made on "the forced transfer of technology, on the ownership." But there are still "issues outstanding" including "enforcement related issues".

But he emphasized: "In each and every place, (A) they've acknowledged their problems. That was a very big hurdle. And (B) what wasn't on the table is on the table, and (C) we're getting closer and closer."

STOCKS

Among the indices, the Dow and Shanghai remains bullish. DAX and Nikkei have key resistances ahead and a near-term pull-back cannot be ruled out in them before further upmove. Sensex looks mixed while the Nifty seems to have the potential to make a near-term bounce.

Dow (26424.99, +40.36, +0.15%) has made a decisive close above 26250 last week. The outlook is bullish for a rise to 26700 and 26750 in the near term. A pull-back to 26500 and 26450 is possible thereafter before the Dow heads towards 27000 and 27200 in the coming weeks.

DAX (12009.75, +21.74, +0.18%) has a key resistance near current levels at 12045. A strong break above it is needed to keep the uptrend intact and test 12100 and 12200 levels. A pull-back from this resistance can drag the index lower to 12870 or even lower in the coming days.

Nikkei (21809.42, +1.92, +0.01%) has an immediate resistance at 21870 which if broken can take it higher to 21930 and 22000. But a pull-back from there can take it lower to 21750 and even lower.

Shanghai (3272.15, +25.58, +0.79%) has opened on a positive note after the long weekend and is closer to our target of 3280. A corrective fall from the 3280-3300 region to 3250 cannot be ruled out. But the broader view remains bullish for the index to test 3350 in the coming weeks.

Sensex (38862, +177.51, +0.46%) has closed on a mixed note on Friday. It has equal chances to move either higher to 39000-39300 or fall to 38500 from current levels. The price action in the next few sessions/days will give a clear cue on it.

Nifty 50 (11665.95, +67.95, +0.59%) looks relatively positive than Sensex as it has held well above the key support at 11600. As long as it trades above 11600, an upmove to 11800 is possible in the near term. On the other hand, the near-term outlook will turn negative for a fall to 11500 and 11450 on a break below 11600.

COMMODITIES

Gold is holding above a key support and may see some uptick in the near term. Silver has resistance ahead and may consolidate sideways in the near term. Copper may trade sideways before a clear trend emerges. Oil remains bullish.

Gold (1297) is trying to inch higher. The sharp bounce from after testing 1280 several times last week leaves the possibility high of gold testing 1305 and 1310 in the near term. Gold is likely to come under pressure again only if it declines below 1280. Supports below 1280 are at 1275 and 1270.

Silver (15.17) has to rise past the 15.25-15.28 resistance cluster to get a breather and rise to 15.40-15.45. A pull-back from this resistance region can drag it to 15 again.

Copper (2.91) has bounced slightly from the key support level of 2.89. As long as it sustains above 2.89, a bounce to 2.95-2.96 is possible in the near term. A range bound move between 2.89 and 2.96 can be seen for some time and a breakout of this range will decide whether Copper is going up to 3.0 or fall to 2.85.

WTI (63.46) is trading just below the key 61.8% Fibonacci retracement resistance level of 63.7. A strong break above it will pave way for a test of 65 and even higher levels in the coming days. But a pull-back from 63.7 can take WTI lower to 62.8 or even 62.

Brent (70.72) has risen past the 69.70-70 resistance region and seems to be gaining strength. The bullish view remains intact for a test of 72.7 – the 61.8% Fibonacci resistance.

FOREX

Dollar-Index (97.29) is likely to remain stable. While below 97.75/50, there is scope of falling towards 96.75 in the near term.

Euro (1.1223) is trading near levels seen on Friday. Euro looks weak and while below 1.1250, it could come off towards 1.11 in the longer run. 1.1150-1.1250 could be the region of trade in the next few sessions.

Euro-Yen (125.04) could face immediate resistance near 125.7-126.0 region which if holds could push the currency pair towards 124-123 levels again in the medium term. While below 126, Euro-Yen remains bearish.

Dollar Yen (111.40) has daily trend resistance at 112.50 which if holds could push the pair towards 111.50-110.50 in the near to medium term. Immediate rise towards 112.50 is possible before a fall is seen from there.

Aussie (0.7098) has been trading along resistance near 0.7150 and is stuck within 0.7150-0.7050 region for the past 15-16 sessions. A rejection from here if sharp enough may break below 0.7050 to head towards 0.6950 in the medium term; else a break above 0.7150, would take it towards the upper resistance near 0.72.

Pound (1.3055) is trading above support at 1.30 and could see some ranged trade within 1.3000-1.3150 region in the near term. An extension above 1.3150 could take it higher towards 1.33/34 levels. For now support at 1.30 is likely to hold.

USDCNY (6.7151) is trading in the 6.70-6.73 region and could trade sideways today. Thereafter a break on either side looks possible; we would wait for confirmation.

Dollar-Rupee (69.23) is likely to remain below 69.50 today. We are considering a rise towards 70 in the medium term, but if 69.50 holds just now, we could see a fall towards 69 again in the next few sessions.

INTEREST RATES

The US yields have dipped slightly and could now see some corrective fall in the next few sessions. The 10YR (2.49%) could fall towards 2.45/43% in the near term while the 30Yr (2.90%) could come off towards 2.85%.

The 10Yr GOI (7.5102%) dipped slightly on Friday. It would be important to see if 7.55% holds and pushes the yield towards 7.40% or lower or allows a rise towards 7.60%. Accordingly, we may see movement in Dollar-Rupee too; given the positive directional correlation currently between Dollar-Rupee and the 10Yr GOI.

The US-JGB 10YR (2.54%) has slightly risen and could move up a bit towards 2.58% before coming off from there back towards 2.50% in the medium term.

The UK-US 10YR (-1.38%) has risen to test immediate resistance and while that holds, a fall to -1.46% could be seen on the cards for the near term.

Chinese Vice Premier Li Keqiang will meet top EU officials in a summit in Brussels on Tuesday. Ahead of that Li wrote in German newspaper Handelsblatt, saying that China was ready to work closely with the EU on climate change, sustainable development, preserving the Iran nuclear deal and fighting terrorism. But China is only willing to exchange views on WTO reforms.

EU, on the other hand, is said to known to be concerned with the unfair trade practices with this systemic rival. In particular, there is no binding commitments from China in key areas, including inclusion of state subsidies on enterprises as part of WTO reforms. And European Council President Donald Tusk was said as objecting to a joint statement for the summit, as China has not delivered on key EU expectations and demands.

The expectations on the summit are generally low.

BoJ Governor Haruhiko Kuroda maintained his view on the economy in a speech at a quarterly meeting of regional branch managers. He said Japan's economy was expected to continue expanding moderately, even though slowdown overseas is affecting exports.

Also, "core consumer inflation is expected to gradually accelerate toward 2 percent as the output gap remains positive, and medium- to long-term inflation expectations heighten."

But for now, BoJ will continue to expand monetary base until consumer inflation exceeds 2% target stably. And, short- and long-term interest rates will be kept at current very low levels for an extended period of time.

Timing is ticking for the UK as April 12 Brexit day is approaching quickly. The talks between Prime Minister Theresa May and Labour leader Jeremy Corbyn yielded no results so far. Labour's top legal policy chief Shami Chakrabarti complained that May has not moved "an inch" on her "red lines". And, "it's hard to imagine that we are going to make real progress now without either a general election or a second referendum on any deal she can get over the line in parliament."

May, on the other hand, said in a video, apparently shot by shaky hands, that "ending free movement, ensuring we leave with a good deal, protecting jobs, protecting security" are things the Conservatives and Labour could agree on. And, she added "it'll mean compromise on both sides" but "delivering Brexit is the most important things for us".

With no cross-party agreement in sight yet, May would need EU's approval on her request for extension until June 30 to avoid a no-deal Brexit. Comments from EU officials suggested that they're against another short extension with no clear and substantial developments in UK. Even the idea of "flextension" was not accepted by all. Some expected that the most likely outcome of the EU summit this week is for May to come out with a long extension. But that will very likely infuriate hard-line Brexiteers in the Conservative Party.

https://www.youtube.com/watch?time_continue=3&v=fC3WYPxM2oY