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For the 24 hours to 23:00 GMT, the USD declined 0.03% against the CHF and closed at 0.993.

Macroeconomic data showed that Switzerland's ZEW economic expectations index fell to a level of 22.2 in April, following a reading of 29.6 in the previous month. On the other hand, the nation's UBS consumption indicator climbed to a level of 1.50 in March, after recording a revised level of 1.45 in the prior month.

In the Asian session, at GMT0300, the pair is trading at 0.9929, with the USD trading slightly lower against the CHF from yesterday's close.

The pair is expected to find support at 0.9907, and a fall through could take it to the next support level of 0.9886. The pair is expected to find its first resistance at 0.9959, and a rise through could take it to the next resistance level of 0.9990.

Ahead in the day, investors will focus on Switzerland's trade balance figures for March.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD rose 0.32% against the CAD and closed at 1.3615.

The Canadian Dollar lost ground, on reports that the US is considering withdrawal from the North American Free Trade Agreement (NAFTA) between the US, Canada and Mexico.

On the data front, Canada's retail sales unexpectedly dropped 0.6% MoM in February, compared to a revised advance of 2.3% in the previous month, while investors had envisaged for a flat reading.

In the Asian session, at GMT0300, the pair is trading at 1.3558, with the USD trading 0.42% lower against the CAD from yesterday's close.

The pair is expected to find support at 1.3517, and a fall through could take it to the next support level of 1.3476. The pair is expected to find its first resistance at 1.3623, and a rise through could take it to the next resistance level of 1.3688.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

Global Markets:

• Asian stock markets: Nikkei down 0.30 %, Shanghai Composite fell 0.40 %, Hang Seng lost 0.05 %, ASX 200 gained 0.05 %
• Commodities: Gold at $1268 (+0.35 %), Silver at $17.52 (+0.50 %), WTI Oil at $49.40 (-0.45 %), Brent Oil at $52.20 (-0.35 %)
• Rates: US 10 year yield at 2.32, UK 10 year yield at 1.09, German 10 year yield at 0.36

News & Data:

• PBOC sets USD/CNY reference rate for today at 6.8896 (vs. yesterday at 6.8845)
• Trump tells Canada, Mexico, he won't terminate NAFTA treaty: White House – RTRS
• Asian shares retreat from highs on doubts over Trump tax plan – RTRS
• Oil prices fall on lingering oversupply concerns – RTRS

Bank of Japan Rate Decision:

• BOJ holds rate at -0.10%, maintains 10yr yield target at 0.00%, as expected
• Japan's economy turning towards moderate expansion
• Economy, price risks tilted towards downside
• Output, exports on upward trend
• Japan economy likely to continue moderate expansion
• Momentum towards hitting 2 percent target lacking
• Long-term inflation expectations remain on weak note

Markets Update:

Stock markets fell after US President Trump's tax reform announcement fell short of expectations. There was a lack of details and the market is still doubting whether the reform will be able to pass in Congress.

The US Dollar came under pressure too. EUR/USD jumped back above 1.09, while GBP/USD is approaching again the 1.29 level. Meanwhile, USD/JPY retraced back to 111 and briefly fell below that level in the Asian session. No surprises from the BoJ, as they left interest rates and the size of their QE programme unchanged.

Nevertheless, commodity currencies remain weak. AUD/USD broke below 0.7480 support and extended losses to 0.7450 yesterday. The charts suggest a move towards 0.73 could follow in the near-term. Price action in NZD/USD is looking quite bearish as well.

The main event today will be the ECB rate decision. The market is no expecting any changes, and Draghi is likely to remain neutral during the press conference. Inflation is still low in the Euro Zone, and it will take some time for the central bank to switch to a more hawkish bias.

Upcoming Events:

• 07:00 GMT – Swiss Trade Balance
• 07:30 GMT – Bank of Japan Press Conference
• 10:00 GMT – Euro Zone Consumer Confidence
• 12:45 GMT – ECB Rate Decision
• 13:00 GMT – German CPI
• 13:30 GMT – US Durable Goods Orders
• 13:30 GMT – US Initial Jobless Claims
• 13:30 GMT – ECB Press Conference
• 15:00 GMT – US Pending Home Sales

Asia Mid-Session Market Update: BOJ on hold as expected; Trump nixes bailing on NAFTA; Samsung Electronics shares rise on outlook

US Session Highlights

Stocks remained mostly unchanged on the day after giving up small gains made during the first half of today's session. Investors digested Trump's relatively broad tax reform plan as it was presented. Fixed income become the asset of choice again, as the 10-year yield dropped 3bps on the day. Volume continued to show strength, on NYSE at 3:30pm was 18% above its 3-month average.

Trump proposed an overhaul of the tax system with large reductions in corporate rates and amount of income brackets, though many precise details remain to be fleshed out. In the plan presented today, the corporate tax would be cut from 35% to 15% and the number of income brackets would be reduced from 7 to 3. The top income tax rate would be 35% and the lower brackets would be set to 25% and 10%. The proposal would also look at repealing the inheritance tax and limiting tax deductions.

US markets on close: Dow -0.1%, S&P500 flat, Nasdaq flat

Best Sector in S&P500: Telecommunications

Worst Sector in S&P500: Real Estate

Biggest gainers: EW +10.5%; WYN +9.0%; PRGO +7.7%

Biggest losers: STC -16.8%; CHRW -6.3%; DPS -5.5%

At the close: VIX 10.85 (bps); Treasuries: 2-yr 1.28% (bps), 10-yr 2.32% (bps), 30-yr 2.97% (bps)

US movers afterhours

TER Reports Q1 $0.44 v $0.38e, R$457M v $439Me; Guides Q2 $0.81-0.90 v $0.60e, R$660-700M v $564Me; +11.1% afterhours

UCTT Reports Q1 $0.47 v $0.42e, R$204.6M v $192Me; Guides Q2 adj $0.49-0.55 v $0.33e, R$210-220M v $181Me; +10.4% afterhours

INTU Reports season to date total Turbo Tax units were up 2% y/y; +7.3% afterhours

ALSN Reports Q1 $0.52 v $0.35e, R$499M v $463Me; +6.8% afterhours

WTW Names Mindy Grossman President and CEO, effective in July; +6.0% afterhours

SAM Reports Q1 $0.45 v $0.26e, R$161.7M v $170Me; Affirms FY17 $4.20-6.20 v $5.46e; -0.3% afterhours

ETH Reports Q3 $0.23 v $0.27e, R$180.5M v $184Me; -4.0% afterhours

CTXS Reports Q1 $0.97 v $0.94e, R$663M v $661Me; Guides Q2 $0.97-1.00 v $1.08e, R$685-695M v $693Me; -5.5% afterhours

FFIV Reports Q2 $1.95 v $1.97e, R$518M v $523Me; Guides Q3 $2.01-2.04 v $2.08e, R$520-530M v $537Me; -7.9% afterhours

AMSC; AMSC Guides Q4 rev $15-16M v $24.6Me; -35.7% afterhours

Key economic data

(JP) BOJ LEAVES INTEREST RATE ON EXCESS RESERVES (IOER) UNCHANGED AT -0.10% AND 10-YEAR JGB YIELD TARGET AT AROUND 0.0%; AS EXPECTED

(CN) CHINA MAR INDUSTRIAL PROFITS Y/Y: 23.8% V 2.3% PRIOR

(AU) AUSTRALIA Q1 IMPORT PRICE INDEX Q/Q: 1.2% V -0.5%E; EXPORT PRICE INDEX Q/Q: 9.4% V 8.0%E

(KR) SOUTH KOREA PRELIM Q1 GDP Q/Q: 0.9% V 0.8%E; Y/Y: 2.7% V 2.6%E

(JP) Japan investors net sold ¥1.82T in foreign bonds v sold ¥796B in prior week; Foreign investors net bought ¥258B in Japan stocks v bought ¥315.2B in prior week

Asia Session Notable Observations, Speakers and Press

Asian equity markets are mixed as investors digest the news out of Washington, as Trump administration has clearly shifted into a higher gear on policy. After unveiling the broad outlines to a massive corporate tax cut reduction, White House officials have taken on the trade agenda, as Commerce Min confirmed "investigation into whether aluminum imports compromise national security". This has been perceived as a shot across the bow by Beijing, calling for direct dialogue on handling trading of the metal. In similar vein, White House announced that after speaking with leaders of Canada and Mexico, Pres Trump decided not to terminate NAFTA at this time, as all leaders agreed to "enable renegotiaton of NAFTA deal" at later date.

FX market activity was more volatile on the US policy developments. USD/MXN and USD/CAD fell 1% and 0.5% respectively on NAFTA announcement, while AUD/USD saw session lows on protectionist fears from aluminum action. USD/JPY was little changed in the wake of more upbeat BOJ policy announcement, trading around 111.20. BOJ maintained its yield curve control at 0.0% on the 10-yr JGB yield and -0.1% rate on IOER, but raised its forward GDP estimates for the current year from 1.5% to 1.6% and next year from 1.1% to 1.3%. BOJ also expressed some concerns over slow progress on inflation front, cutting FY17 CPI view from 1.5% to 1.4%. In terms of its assessment, BOJ said Japan's economy has been turning towards a moderate expansion (prior was continues to recover moderately), while also boosting its view of Exports and Industrial Output to "increasing trend" from "picked up".

Among key corporates, Samsung Electronics final Q1 results was below consensus at KRW) Net 7.49T v 8.8Te on Rev of 50.6T v 56.5Te, but the company forecast Net profit to turn higher this year, Capex to increase, and smartphone sales to bounce. SE also announced its first ever dividend and a KRW2.3T buyback, earning praise from activist Elliott Management which had in the past called for a split into a holding vehicle even though the company did not commit to that structure. After initial downside, shares moved higher by about 2%.

China

(US) Commerce Dept confirms opening investigation into whether aluminum imports compromise national security

(CN) China Commerce Ministry: US Commerce Dept mishandled China plywood companies in subsidies probe; Urging US to abide by WTO rules in plywood probe; need a dialogue with Us to address aluminum - press

(CN) China MOFCOM reports Q1 exports to Belt and Road nations +26.2% y/y (28.2% of total exports)

(CN) China Iron and Steel Association (CISA): memorandum signed by President Trump encouraging an investigation of US steel imports is contrary to fair trade and sends a signal of protectionism

Australia

(AU) Australia PM Turnbull expected to impose a Domestic Gas Security Mechanism from July 1 this year and that it would not require legislation in Parliament as it can be imposed as a customs regulation

Korea

(KR) South Korea Trade Ministry raises 2017 export growth outlook to 6-7% v 2.9% prior

(KR) White House administration signs communique directed at North Korea following briefing with US lawmakers

Asian Equity Indices/Futures (00:00ET)

Nikkei -0.2%, Hang Seng flat, Shanghai Composite -0.4%, ASX200 +0.2%, Kospi -0.2%

Equity Futures: S&P500 +0.1%; Nasdaq +0.1%, Dax +0.2%, FTSE100 +0.1%

FX ranges/Commodities/Fixed Income (00:00ET)

EUR 1.0900-1.0920; JPY 111.00-111.40; AUD 0.7470-0.7490; NZD 0.6890-0.6920

June Gold +0.3% at 1,268/oz; June Crude Oil -0.5% at $49.37/brl; July Copper -0.4% at $2.59/lb

SLV iShares Silver Trust ETF daily holdings rise to 10,273 tonnes from 10,178 tonnes prior

(CN) PBOC SETS YUAN MID POINT AT 6.8896 V 6.8845 PRIOR; 3rd straight weaker setting; weakest setting since Apr 12th

(CN) PBOC to inject combined CNY50B v CNY80B prior in 7-day, 14-day and 28-day reverse repos, 8th straight injection

(NZ) New Zealand MoF sells NZ$150M in 2037 bonds

Asia equities / Notables / movers by sector

Samsung Electrocnis, 005930.KR +1.9%, final Q1 results

AIA, 1299.HK, +4.4%, Q1 results

Sands China, 1928.HK, -3.3%, Q1 results

Tokuyama, 4043.JP, +5.8%, sells Malaysia business

Canon, 7751.JP, +3.9%, Q1 results

Yahoo Japan, 4689.JP, -9.9% FY16/17 results

China Minsheng Bank, 1988.HK, +1.3%, Q1 results

China Shipbuilding Industry, 601989.CN, -3.7%, Q1 results

BHP, BHP.AU, -1.0%, weaker on Australia Govt gas export limitation plan

Clean TeQ Holdings, CLQ.AU, +14.8%, results

Ten Networks, TEN.AU, -15.2%; H1 results, going concerns on fuding

Daily Pivots: (S1) 0.9909; (P) 0.9939; (R1) 0.9960; More.....

Intraday bias in USD/CHF remains neutral for the moment. At this point, with 0.9999 minor resistance intact, deeper fall is still in favor. Below 0.9897 temporary low will turn bias to the downside for 0.9812 and possibly below. Nonetheless, whole decline from 1.0342 is seen as a correction. Hence, we'll look for bottoming signal below 0.9812. Meanwhile, on the upside, above 0.9999 minor resistance will turn bias back to the upside for 1.0107 resistance.

In the bigger picture, we're still maintaining that firm break of 1.0342 key resistance is needed to confirm underlying bullish momentum in the cross. However, the corrective nature of the fall from 1.0342 is starting to give the medium term outlook a bullish favor. Hence, in stead of looking for topping signal around 1.0342, we'd now pay closer attention to upside acceleration as USD/CHF approaches this level again.

Daily Pivots: (S1) 110.68; (P) 111.23; (R1) 111.60; More....

At this point, further rise is expected in USD/JPY with 109.58 minor support intact. Sustained trading above 111.58 support turned resistance will indicate that fall from 118.65 is merely a corrective move and has completed. Outlook will then be turned bullish for 115.49 resistance and above. However, break of 109.58 will argue that fall from 118.65 is still in progress and will turn bias to the downside for 108.12 and below.

In the bigger picture, price actions from 125.85 high are seen as a corrective pattern. Current development suggests that it's not completed yet and is extending. In case of deeper decline, downside should be contained by 61.8% retracement of 75.56 to 125.85 at 94.77 to bring rebound. Rise from 75.56 is still expected to resume later after the correction from 125.85 completes.

Daily Pivots: (S1) 0.7435; (P) 0.7493; (R1) 0.7532; More...

AUD/USD's break of 0.7472 support revives that case that whole rise from 0.7150 is completed at 0.7748. Intraday bias is turned back to the downside. Deeper fall is now anticipated back to test 0.7144/58 key near term support zone. On the upside, break of 0.7609 resistance is now needed to indicate completion of the fall from 0.7748. Otherwise, outlook will stay mildly bearish in case of recovery.

In the bigger picture, we're still treating price actions from 0.6826 low as a correction. And, as long as 38.2% retracement of 0.9504 to 0.6826 at 0.7849 holds, long term down trend from 1.1079 is expected to resume sooner or later. Break of 0.6826 low will target 0.6008 key support level. However, firm break of 0.7849 will indicate that rise from 0.6826 is developing into a medium term rebound, rather than a sideway pattern. In such case, stronger rise should be seen to 55 month EMA (now at 0.8144) and above.

Daily Pivots: (S1) 1.3568; (P) 1.3568; (R1) 1.3647; More....

A temporary top is in place at 1.3647 after USD/CAD fails to sustain above 1.3598 key resistance. Intraday bias is turned neutral first. Some consolidations should be seen but downside of retreat would be contained by 1.3410 support to bring another rally. Break of 1.3647 will extend the whole medium rise from 1.2460 to next medium term fibonacci level at 1.3838. However, break of 1.3410 will turn bias back to the downside for 1.3222 support instead.

In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. The first leg has completed at 1.2460. The second leg from 1.2460 is likely still in progress and could target 61.8% retracement of 1.4689 to 1.2460 at 1.3838. We'd look for reversal signal there to start the third leg. However, break of 1.2968 will argue that the third leg has already started and should at least bring a retest of 1.2460 low. Meanwhile, sustained trading above 1.3838 would pave the way to retest 1.4689 high.

The financial markets had very little reaction to the highly anticipated announcement of tax reforms by US President Donald Trump. DJIA reversed earlier gains and closed slightly lower by -0.1% at 20975.09. S&P 500 also closed down -0.05% at 2387.56. Both were held below record intraday highs of 21169.11 and 2400.98 respectively. 10 year yield also closed lower, losing -0.016, at 2.311. The dollar index struggled to find follow through buying above 99 and is back at 98.90 in Asian session. In the currency markets, Euro remains the strongest major currency for the week, followed by Sterling and Swiss Franc. Yen remains the weakest one after BoJ stands pat, raised growth forecast but lowered inflation projections. Canadian dollar is still trading down for the week but is given a mild boost on news that US will stay with NAFTA for the moment.

Trump delivered a 1-page tax plan

Trump gave a one-page handout to reporters at the White House outlining the tax proposals. The plan includes sections on business and individual reforms. Top corporate tax rate of all businesses will be lowered from 35% to 15%. There will be a "one-time" tax on dollars held by corporations overseas but the rate is not decided yet. Tax breaks for special interests will eliminated. For the individuals, seven tax brackets will be reduced to three of 10%, 25% and 35%. Standard deduction will be doubled and there will tax relief for families with child and dependent care expenses.

Canadian Dollar rebound as NAFTA stays

Canadian Dollar rebounds after the White House said that Trump will not terminate the participation in the North American Free Trade Agreement immediately. The White House said in a statement that there were "pleasant and productive" conversations with leaders of Mexico and Canada. And Trump agreed not to terminate NAFTA at this time and the leaders agreed to "proceed swiftly, according to their required internal procedures, to enable the renegotiation of the Nafta deal to the benefit of all three countries." Commerce Secretary Wilbur Ross said earlier this week that the administration is working with the Congress to start renegotiation of NAFTA as Trump has been openly criticizing the deal. But some Republicans are clearly in objection to scrapping NAFTA.

BoJ raised growth forecast, cut inflation estimate

BoJ left monetary policies unchanged today as widely expected. In the quarterly report of Outlook for Economic Activity and Prices, the central bank lowered inflation forecast for the current fiscal year to 1.4%, down from January's projection of 1.5%. Inflation forecast for fiscal 2018 was held unchanged at 1.7%. On the other hand, growth forecast for fiscal 2017 was revised up to 1.6%, from 1.5%. For fiscal 2018, growth is projected to be at 1.3%, up from prior estimation of 1.1%.

UK PM May held constructive talk with EC President Juncker

UK Prime Minister Theresa May met with European Commission President Jean-Claude Juncker yesterday on a discussion over Brexit. UK's main negotiator David Davis and EU's negotiator Michel Barnier were also present. May's spokesperson said in a statement that the meeting was "constructive" and May "reiterated the UK's commitment to achieving a deep and special partnership with the European Union." EC also said in a statement that the meeting was "constructive" and addressed "issues of strategic interest". No detail about the conversation was released. EU leaders will meet this Saturday to work on their own negotiation plan and official talk will start after UK election on June 8. Barnier noted that the negotiations must be concluded within 18 months to allow time for approval by respective parliaments.

CBI director general warned no trade deal should be Plan Z

CBI director general Carolyn Fairbairn warned that the long term trading relationship between UK and EU is "the real prize", "dwarfing any potential divorce settlement." And, "a one-off EU divorce bill of, some suggest, tens of billions of euros, compared with EU-UK trade worth well over €600bn euros every year, the economic case for making rapid progress on a trade agreement is clear." She urges that "economics cuts through the politics" in the discussions. And, "the business community - in the UK and the EU - is united in wanting an agreement with as few barriers as possible. Yet without an agreement, we'd lose together." And, "for both sides, leaving the negotiating table without a deal shouldn't be 'Plan B' but 'Plan Z'".

ECB to stand pat today

ECB is widely expected to keep monetary policies unchanged today. The first round result of French presidential election, and centrist Emmanuel Macron's high chance of winning the run-off should give ECB much relief. Nonetheless, the central bank is still not ready to hint on any stimulus exit yet. ECB President Mario Draghi has stressed enough that there are much downside risks to the economy, and underlying inflation stayed low. Risks are still tilted much to the downside in spite of the French election results. Meanwhile, various ECB officials have clearly expressed that the course of monetary policies are set for 2017. The central bank will continue with its EUR 60b per month asset purchase till the end of the year. And it's unlikely that policy makers will opt for a rate hike before the asset purchase ends. We'd expect the speculation and debate on exit to start heating up again in June.

Elsewhere

Australia import price index rose 1.2% qoq in Q1, much higher than expectation of -0.5% qoq. Swiss will release trade balance in European session. Germany will release Gfk consumer sentiment and CPI. Eurozone will release confidence indicators. UK will release CBI reported sales. From US, trade balance, wholesale inventories, durable goods orders, jobless claims and pending home sales will be featured.

USD/CAD Daily Outlook

Daily Pivots: (S1) 1.3568; (P) 1.3568; (R1) 1.3647; More....

A temporary top is in place at 1.3647 after USD/CAD fails to sustain above 1.3598 key resistance. Intraday bias is turned neutral first. Some consolidations should be seen but downside of retreat would be contained by 1.3410 support to bring another rally. Break of 1.3647 will extend the whole medium rise from 1.2460 to next medium term fibonacci level at 1.3838. However, break of 1.3410 will turn bias back to the downside for 1.3222 support instead.

In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. The first leg has completed at 1.2460. The second leg from 1.2460 is likely still in progress and could target 61.8% retracement of 1.4689 to 1.2460 at 1.3838. We'd look for reversal signal there to start the third leg. However, break of 1.2968 will argue that the third leg has already started and should at least bring a retest of 1.2460 low. Meanwhile, sustained trading above 1.3838 would pave the way to retest 1.4689 high.

Economic Indicators Update

STOCKS

The tax plan released by Trump yesterday proposed to sharply slash business taxes. It proposed to cut income tax rate from 39.6% to 35% , reduce corporate tax from 35% to 15% and to reduce the seven tax brackets for individuals to 3-tax brackets of 10%, 20% and 35% respectively.
The US stocks have not really moved up at the end f the session. Dow (20975.09, -0.10%) is testing resistance on the daily and 3-day line charts and could possibly come off in the near term. However, when looked at the candle charts, there could be some scope of rising towards 21200-21400 before starting a correction.

Dax (12472.80, +0.05%) could move sideways to create more scope of an upmove. For now 12532 is an important resistance and it could be tested in the next 3-4 sessions.

Shanghai (3112.40, -0.91%) has fallen sharply again coming down to test 3100 levels and looks bearish for the week. A break or bounce from levels near 3100 would decide the next course of direction.

Nikkei (19243.76, -0.24%) is stable just now but could head towards 19620 as mentioned yesterday. Immediate trend is up.

Nifty (9351.85, +0.49%) has been playing out in line with our expectation and could face rejection from resistance near 9400.

COMMODITIES

Muted price action had been seen in Gold (1266).Immediate supports are poised at 1260 and 1239 respectively. Buyers will take every dip as a further opportunity for buying while it is trading above 1239. 1285 could be a level where the price action has to be checked to assess the chances of further bounce to 1305 to 1330 levels.

Silver (17.43) is Oversold on the near-term charts and it is hovering around its crucial resistance at 17.45.A close above that could open up 17.80 levels as well. Immediate support is at 17.02 levels.

Copper (2.57) had failed to close above 2.62 levels. A close below 2.55 could open up 2.48 and 2.45 levels respectively. The bias would remain bearish while it is trading below 2.62-67 levels.

Brent (51.69) and WTI (49.42) have been well supported due to decrease (-3.6M) in U.S crude oil inventory and near term Oversold condition. In a major downtrend like this, the bounces are generally seen as fresh shorting opportunities by the big money with the speculators excited with the fast movement. While we have been expecting a bounce from 51.69 to53.80 in Brent and 49.42 to 51.50 in WTI , we prefer to wait for higher levels to create fresh short positions.

FOREX

Nothing has changed much after the Trump tax plan came out as a page full of bullet points denied all the necessary details to understand anything clearly about it and told of nothing new. It remains to be seen if the BOJ and ECB meet today can trigger any major moves.

Dollar Index (98.89) still hovers just above the make or break support of 98.50 but requires a rise above 99.35 for a confirmed reversal signal and Euro (1.0911) has again come off the highs after being rejected from the major resistance of 1.0950, keeping open the possibility of a downward correction to 1.0840 and 1.0700. Today's ECB meet may turn out to be a market driver.

It has been another quiet session for Pound (1.2870) in 1.2750-1.2900 as expected which may continue for the last 2 sessions of the week too.

Dollar-Yen (111.22), just as expected, has stalled after hitting a high of 111.77, bang in the middle of our target/resistance area of 111.50-112.00 as it waits for the BOJ meet conclusion due in a few minutes. Support remains unchanged at 110.00.

Aussie (0.7487) has tested and bounced exactly from the lower end of the range of 0.7450-0.7600. The lack of downside momentum may push it up to 0.7550 once again before any large directional move emerges.

Dollar-Rupee (64.12) has resolved the range of 64.20-70 to the downside and now, as long as the resistance of 64.35-45 holds, the path of least resistance points down. Initial support comes at 63.80 which may be revised later to 63.60-50 if needed.

INTEREST RATES

ECB Policy meet is due today. Markets await to watch if there is any indication of an eventual stimulus reduction that Draghi may signal today. The German yields could come off in the near term as they are headed towards near term resistances. The 10Yr (0.35%) could move up towards 0.40% in the coming sessions.

The US yields have fallen slightly. The 5Yr (1.84%), 10YR (2.31%) and the 30YR (2.97%) are down from previous levels of 1.86%, 2.33% and 2.98% respectively. The yields could start coming off again in the near term.

The German-US 2Yr (-1.98%) has come off and is testing the earlier resistance turned support near current levels. A bounce from here could trigger some more strength in Euro in the near term. We need to keep a close watch for further directional cues.