Sample Category Title

GBP/USD rise stops, starting a bearish consolidation phase at the 1.4170 range. Hourly support and resistance are given at 1.3905 (23/02/2018 low) and 1.4278 (02/02/2018 high). The technical structure suggests short-term consolidation.

The long-term technical pattern is reversing. The Brexit vote had paved the way for further decline but the pair is moving to 2016 highs. Long-term support and resistance are given at 1.1841 (07/10/2017 low) and 1.5018 (24/06/2016 high).

EUR/USD bullish trend pauses, trading at the 1.2370 range. The pair is currently maintained between hourly support and resistance given at 1.2165 (17/01/2018 low) and 1.2506 (25/01/2018 high). The technical structure suggests sideways trading moves.

In the longer term, the momentum is turning largely positive. We favor a continued bullish bias. Key resistance is holding at 1.2886 (15/10/2014 high) while strong support lies at 1.1554 (08/11/2017 low).

The EUR/GBP has been trapped within the narrow range of W L3 and W H3 Pivot. Slow price action indicates that we might expect a breakout when volatility gets higher. At this point, the price is stalling between the two trend line diagonals that also intersect essential pivot points. Break of W H3 – 0.8737 should target 0.8760 and possibly 0.8792. However a break of D L3 – 0.8710 should target 0.8680. The EUR/GBP ATR is low, so pay attention to breakouts and corresponding targets.

W L3 - Weekly Camarilla Pivot (Weekly Interim Support)

W H3 - Weekly Camarilla Pivot (Weekly Interim Resistance)

W H4 - Weekly Camarilla Pivot (Strong Weekly Resistance)

D H4 - Daily Camarilla Pivot (Very StrongDaily Resistance)

D L3 – Daily Camarilla Pivot (Daily Support)

DL4 – Daily H4 Camarilla (Very Strong Daily Support)

POC - Point Of Confluence (The zone where we expect price to react aka entry zone)

Trade figures out of China are scheduled for release on Friday for the month of March, with consensus forecasts of a sharp deceleration in exports and a smaller trade surplus. The data comes amid heightened risk of a trade war between China and the United States as the two economic powerhouses quarrel over unfair trade practices.

Chinese exports surged by 44.5% year-on-year in February – the biggest jump in three years – mainly due to the effects of the timing of this year’s Lunar New Year. However, export growth is expected to come down to more typical levels to 10% y/y in March. If confirmed, it would be the 13th month in-a-row of positive growth in the country’s exports, suggesting little risk of a return to the slowdown seen in 2015-2016. Imports are also forecast to rise by 10% in March, up from 6.3% in the prior month. The trade balance is expected to show a smaller surplus of $27.21 billion compared with a surplus $33.75 billion in February.

Worse-than-expected data could raise concerns of a deeper slowdown in economic growth in 2018 than the mild moderation to 6.6% from 6.9% in 2017 being forecast by most analysts. Investors will get the chance to assess the first glimpse of GDP performance in 2018 when first quarter growth figures are published on April 17.

On Wednesday, inflation data revealed both consumer and producer prices rose by less than expected in March on the back of slowing credit growth, as Chinese authorities maintained their efforts to deleverage the economy. Other recent data has also been mixed with the official and Caixin/Markit manufacturing PMIs diverging since the beginning of 2018.

Despite the not-so-robust indicators however, as well as recent concerns of a possible trade war with the US, most analysts are optimistic about China’s economic fundamentals, especially after President Xi’s speech this week where he promised more reforms and to open up the economy to foreign firms.

A positive surprise in Friday’s trade numbers would underscore the upbeat outlook. It could also help the yuan move closer to the 2½-year high of 6.2410 set back in March. The yuan had come under brief pressure on Monday on reports that the Chinese government is considering devaluating the currency as a possible tool in any trade war. But a conciliatory tone by President Xi in his address at the Boao Forum for Asia helped calm market nerves of an escalation in trade tensions with the US.

The subsequent rise in risk appetite helped the Australian dollar climb to a three-week high of $0.7773 on Wednesday. The aussie could extend those gains if the China trade figures beat the forecasts. Aussie/dollar could head towards 0.7780, close to its 50-day moving average. A stronger boost could take the pair to 0.7820, which is the 50% retracement of the December-January upleg. A negative surprise though could see aussie/dollar retreating back to the 0.77 level. A breach of this handle would bring the 0.7650 support region coming back into view.

European Council extends the sanctions on Iran over human rights violation by 1 year today, until April 2019.

The sanctions include:

• Asset freezes, travel restrictions against 82 people and 1 entity.
• Ban on exports of equipment that could be used for internal repression and equipment used for monitoring telecommunications,

EUR/USD

Current level - 1.2357

Yesterday's peak at 1.2395 signals a possible reversal and the bias is bearish, for a dip to 1.2290 support zone.

USD/JPY

Current level - 106.89

The outlook is still positive above 106.60, for a rise towards 108.30 area.

GBP/USD

Current level - 1..4178

The recent reversal at 1.4220 is still not convincing, but my outlook is already bearish, for a slide towards 1.4090 area.

Germany Federal Ministry for Economic Affairs and Energy released a monthly report today. It noted that:

The upswing of the German economy continues with pace moderated slightly. The global economic environment continues to be favorable. However, there are increased risks due to trade conflicts.

The up trends in new orders in manufacturing and industrial production have weakened recently too.

Consumer demand has recently been less dynamic. But consumer and retailers remain confident.

The high demand for labor in large parts of the economy ensures steadily rising employment. There are increase challenger for hiring. Unemployment and underemployment continue to decline.

Here is the full report in German.

Global equity markets are likely to remain firmly gripped by geopolitical risk, as escalating tensions over the conflict in Syria weigh heavily on sentiment.

Geopolitical jitters have already punished Asian markets this morning, with Asia Pacific equities under pressure, following a weak lead from Wall Street overnight. In Europe stocks opened on a shaky note amid the growing caution among investors. With hawkish statements from the Federal Reserve and heightened political uncertainty around the US and Russia standoff leaving investors on edge, Wall Street could extend its losses this afternoon. Global equity bears are likely to remain in the vicinity as the terrible combination of geopolitical tensions and overall market anxiety sour appetite for riskier assets.

Dollar supported by Fed hawks

The Dollar held steady against a basket of major currencies on Thursday morning, after minutes from the Federal Reserve’s latest policy meeting were presented with a hawkish bias.

Market expectations over higher US interest rates this year have received a boost after the FOMC minutes revealed that all policy makers felt that the US economy would strengthen. With policy makers expecting inflation to rise in the coming months, the Federal Reserve may be forced to adopt a slightly more aggressive approach on rate hikes. A strong majority of policymakers viewed the prospects of a potential global trade war as a downside risk for the US economy. These concerns are likely to increase the Dollar’s sensitivity to the US-China trade developments moving forward. All in all, the minutes were pretty hawkish and reflected a strong sense of optimism among policymakers. After the FOMC minutes, the probability of a Fed rate hike in June jumped to 90%, according to CME’s FedWatch Tool.

While the Dollar could benefit from mounting expectations of higher US interest rates, lingering trade war fears and geopolitical tensions could spell trouble for the currency. From a technical standpoint, the Dollar Index remains at risk of trading lower if bulls are unable to secure control above 89.50. Sustained weakness below 89.50 could result in a decline towards 89.00.

Commodity spotlight – Gold

Gold was under pressure on Thursday morning, after hawkish minutes from the Fed’s latest policy meeting boosted expectations over a faster pace of US interest rate hikes this year.

Although the yellow metal may find itself exposed to downside risks in a high interest rate environment, losses could be limited by risk aversion. With geopolitical risk, US-Russia political uncertainty and lingering trade war fears still weighing on sentiment, Gold, which is often popular in times of financial uncertainty, is likely to remain supported. Taking a look at the technical picture, the yellow metal has retreated from an 11-week high, with prices trading around $1348 as of writing. Previous resistance around $1340 could transform into a dynamic support that can encourage an appreciation back towards $1360. A failure for bulls to maintain control above $1340 could result in prices sinking towards $1324.

The Aussie dollar holds in directionless mode for the second day, entrenched within narrow consolidation.

The downside is for now supported by sideways-moving 30SMA (0.7743), with 10/20SMA bull-cross forming and underpinning near-term action along with strengthening momentum studies. Strong barrier, provided by 100SMA (0.7784) keeps the upside limited, with break here and nearby 200SMA (0.7811) needed to generate stronger bullish signal for extension of recovery from the 0.7640 base.

Conversely, negative signals could be expected on break and close below 30SMA which would increase risk of deeper pullback and signal formation of lower platform at 0.7770 zone.

Res: 0.7770, 0.7784, 0.7811, 0.7846
Sup: 0.7743, 0.7706, 0.7693, 0.7652

The pair remains within tight range in early Europe and looking for fresh direction signals on news from Syria.

Falling thick daily cloud continues to cap upside attempts and weighs, but the downside was so far contained by rising 10SMA (106.75) and limited as immediate threats of US attack eased, reducing safe-haven demand.

Near-term action is holding within triangular narrowing range with key points at 106.75 (10SMA) and 107.16 (daily cloud base).

Daily MA’s (10/20/30) are in bullish setup, with strong momentum studies keeping the pair supported.

However, geopolitical tensions are expected to be the main driver. If the situation escalates, yen is expected to strengthen significantly on strong safe-haven demand, while easing tensions would lift the greenback, but the pair may struggle to penetrate thick daily cloud.

Res: 106.70, 107.05, 107.16, 107.50
Sup: 106.75, 106.40, 106.31, 106.00