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CHFJPY: ⬇️ Sell

• CHFJPY reversed from resistance zone
•  Likely to fall to support level 202.00

CHFJPY currency pair recently reversed from the resistance zone between the strong resistance level 204.00 (which stopped wave () in March) and the upper daily Bollinger Band.

The downward reversal from this resistance zone stopped the previous minor impulse wave 3, which belongs to the intermediate impulse wave (3).

Given the strength of the resistance level 204.00, CHFJPY can be expected to fall to the next support level 202.00 (low of the previous correction 2).

Markets

ECB chief economist Lane pitched the idea of expanding the supply of euro assets in a keynote speech today, one of our long-term views. He argues that the existence of a benchmark safe asset that serves as the anchor for asset pricing is a foundational element of any autonomous monetary system. Such an asset should be highly liquid and rise in relative value during stress episodes. The current EMU financial structure lacks such safe asset given that the stock of German Bunds is too small relatively to the size of the euro area or the global financial system. Lane says that common bonds backed by the combined fiscal capacity of the EU member states are capable of providing safe asset services, but the current stock of such bonds is too small at the moment even as it exploded from around €80bn outstanding before the Covid-pandemic to currently over €700bn. There’s sufficient room to expand it further though with the 2024 EU competitiveness report by Mario Draghi estimating the annual cross-border mutual funding need at €750bn. This includes European-wide public goods, but common policy imperatives such as the urgent funding of Ukraine also warrant joint borrowing. Lane floats other options as well like the recently proposed “blue bond/red bond” reform. Under this approach, each member country would ring-fence a dedicated revenue stream (a certain amount of indirect tax revenues, for example) that could be used to service commonly issued bonds. In turn, the proceeds from issuing blue bonds would be deployed to purchase a given amount of the national bonds of each participating Member State. This would result in a larger stock of common bonds (blue bonds) and a lower stock of national bonds (red bonds). Another proposal envisages that financial intermediaries (whether public or private) could bundle a portfolio of national bonds and issue tranched securities, with the senior slice constituting a highly safe asset.

Turning to today’s market moves, the stalemate persists after US president Trump announced an extension to the cease-fire last week. He believes talks are possible as soon as Friday. Visibility is extremely low though with Iran calling the US naval blockade the same as a bombardment and thus an infringement of the cease-fire. Brent crude grinds back above the $100/b mark as the headline roulette keeps spinning with EUR/USD moving further away from the 1.18 resistance mark. Stock markets are treading water with core bond yield curves flattening marginally.

News & Views

Belgian consumer confidence decline for a third consecutive month in April. At -9 (from -6), it hit the lowest level since April 2025. On a macro level, fears of unemployment are growing with the unemployment sub-index rising from -3 to 6. On a personal level; households turned more negative about their capacity to save (18 from 22) and on their overall financial situation (-5 from -3), with both subindices also touching lowest levels since April last year. Expectations concerning the general economic situation in Belgium have improved slightly compared with last month (subindex at -43 from -45) though sentiment remains pessimistic in a broader perspective (e.g. was -25 in February before the start of the conflict in the Middle East).

• The Central Bank of Turkey (CBRT) kept its policy rate unchanged at 37.5%. The CBRT also kept its overnight borrowing and lending rates unchanged at 35.5% and 40% respectively. As the central bank recently didn’t hold one-week repo auctions, the overnight rate gained importance in determining money market rates. It was the second consecutive month that the CBRT kept its policy stable after easing the policy rate from 46% to 37% over the July 2025 - Jan 2026 period. Turkish inflation eased to 1.94% M/M and 30.87% Y/Y in March to be compared with a level of 42.1 % at the start of 2025. The CBTR assesses that while the underlying trend of inflation still declined in March, leading indicators suggest a slight increase in the underlying trend in April. Geopolitical developments and resulting uncertainties are keeping energy prices elevated and are a source of volatility. Even as the recent indictors point to a slowdown in activity, the central bank indicates that potential second-round effects of recent developments on the inflation outlook will be of importance and that the committee remains highly attentive to upside inflation risks. The reaction of the Turkish lira to the rate decision was limited. At EUR/TRY 52.7; the Turkish currency still trades near historic low levels reached over the previous week.

Daily Pivots: (S1) 1.1708; (P) 1.1750; (R1) 1.1785; More….

Intraday bias stays neutral in EUR/USD and more consolidations could be seen below 1.1848. With 1.1662 support intact, further rally is in favor. On the upside, sustained trading above 61.8% retracement of 1.2081 to 1.1408 at 1.1824 will pave the way to retest 1.2081 high. However, firm break of 1.1662 support will bring deeper decline back towards 1.1408 low instead.

In the bigger picture, the strong support from 38.2% retracement of 1.0176 to 1.2081 at 1.1353 suggests that the pullback from 1.2081 is more likely a corrective move. Strong support was also found in 55 W EMA (now at 1.1507). Focus is back on 1.2 key cluster resistance level. Decisive break there will carry long term bullish implications. Nevertheless, break of 1.1408 support will revive the case of medium term bearish trend reversal.

Daily Pivots: (S1) 1.3475; (P) 1.3508; (R1) 1.3542; More...

Intraday bias in GBP/USD remains neutral and more consolidations could be seen below 1.3598. With 1.3379 support intact, further rise is favor. On the upside, sustained break of 61.8% retracement of 1.3867 to 1.3158 at 1.3596 will pave the way to retest 1.3867 high. However, firm break of 1.3379 will bring deeper fall back to 1.3158 low instead.

In the bigger picture, current development suggests that price actions from 1.3867 are merely a corrective pattern within the broader up trend from 1.0351 (2022 low). With 1.3008 support intact, medium term bullishness is maintained and break of 1.3867 is back in favor for a later stage, towards 1.4248 key resistance (2021 high).

Daily Pivots: (S1) 0.7782; (P) 0.7805; (R1) 0.7830; More….

Intraday bias in USD/CHF remains neutral as consolidations continue above 0.7774. Stronger recovery might be seen but upside should be limited below 0.7933 resistance to bring another fall. Sustained break of 61.8% retracement of 0.7603 to 0.8041 at 0.7770 will resume the decline from 0.8041 to retest 0.7603 low.

In the bigger picture, rebound from 0.7603 medium term bottom is seen as correcting the fall from 0.9200 only. Rejection by 55 W EMA (now at 0.8059) will affirm this bearish case, and setup down trend resumption to 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382 at a later stage. Though, sustained break of 55 W EMA will suggest that it's probably correcting the larger scale down trend from 1.0146 (2022 high).

Daily Pivots: (S1) 158.80; (P) 159.28; (R1) 159.87; More...

USD/JPY is still gyrating in range below 160.45 as consolidations continues. Intraday bias stays neutral for the moment. Further rise is expected with 157.49 cluster support (38.2% retracement of 152.25 to 160.45 at 157.31) intact. On the upside break of 160.45 will target a retest on 161.94 high. However, firm break of 157.31/49 will bring deeper fall back to 61.8% retracement at 155.38 next.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 153.80) holds. Firm break of 161.94 will pave the way to 61.8% projection of 102.58 to 161.94 from 139.87 at 176.75.

Markets are showing a clear "split personality" right now. Equities are pushing higher on the back of the extended US–Iran ceasefire, while oil continues to signal caution and Dollar is caught between opposing forces. The result is a fragmented picture where no single macro narrative is dominating.

US futures are trading higher after President Donald Trump announced an indefinite extension of the ceasefire. Despite stalled talks, the move has removed the immediate threat of escalation for now, allowing equities to lean risk-on. For the S&P 500 and NASDAQ, the extension is effectively a “yellow light”—not a full green signal, but enough to justify holding or adding exposure in the near term.

At the same time, equities are increasingly pivoting back to fundamentals. Strong Q1 earnings and the continued momentum of the AI-driven investment cycle are providing a more compelling narrative than the geopolitical stalemate. There is a clear effort to decouple from daily headlines, with investors focusing on earnings visibility rather than conflict risk.

In contrast, energy markets are not looking through the situation. Brent may have cooled from peaks above $120, but it remains firmly anchored near $100. This suggests traders are pricing in prolonged disruption in the Strait of Hormuz, even without a full escalation scenario. Oil is effectively signaling that supply risks remain embedded in the system.

This divergence is feeding into the broader inflation outlook. Even without further escalation, the surge in energy costs has already reset the inflation floor. Higher fuel and transport costs are filtering through global supply chains, keeping price pressures elevated and complicating the monetary policy outlook.

Bond markets are reflecting this skepticism. Yields remain supported by the view that Fed cannot pivot quickly toward easing. The persistence of inflation risks means policy is likely to stay restrictive for longer than markets might otherwise expect, with some global central banks pivoting towards tightening.

Currency markets are where these conflicting forces are most visible. Dollar is being pulled in opposite directions. On one hand, the ceasefire extension reduces safe-haven demand. On the other, elevated yields continue to attract capital inflows. Commodity currencies such as the Canadian and Australian Dollars are also caught in this crosscurrent. Higher oil and gas prices are supportive, but the risk of a global slowdown linked to energy-driven inflation caps upside. The result is choppy, range-bound trading rather than directional moves.

This week’s FX performance reflects this lack of conviction. Kiwi is leading on domestic rate expectations, followed by Loonie and Dollar. Yen is the weakest, with Euro and Aussie also under pressure. Sterling and Swiss Franc are holding in the middle. There is no coherent global theme driving currencies.

The broader takeaway is that markets are no longer aligned. Equities are pricing stability, oil is pricing disruption, and bonds are pricing inflation persistence. Each asset class is telling a different story.

Until there is clarity on whether US–Iran talks resume or a decisive shift in geopolitical conditions, this split personality is likely to persist. Markets are not ignoring the risks—but they are no longer reacting to them in the same way.

In Europe, at the time of writing, FTSE is down -0.02%. DAX is down -0.01%. CAC is down -0.30%. UK 10-year yield is down -0.011 at 5.128. Germany 10-year yield up 0.002 at 3.006. Earlier in Asia, Nikkei rose 0.40%. Hong Kong HSI fell -1.22%. China Shanghai SSE rose 0.52%. Singapore Strait Times fell -0.24%. Japan 10-year JGB yield rose 0.013 to 2.399.

UK CPI Hits 3.3% as Fuel Costs Drive Inflation Higher, Pipeline Pressures Build

UK CPI rose to 3.3% in March as fuel costs pushed inflation higher. Core inflation eased slightly, but rising PPI and oil prices signal building pipeline pressures. Read more.

Japan's Exports Rise 11.7% in March, Trade Surplus Misses

Japan posted another solid month for exports, led by semiconductors and China demand. But the trade surplus still missed expectations as imports jumped on energy costs and a weaker Yen. Read More.

Australia Westpac Leading Index Turns Negative, Signals Below-Trend Growth Ahead.

Australia’s growth signal has turned negative. The Westpac Leading Index now points to below-trend growth, but rising energy costs and inflation risks keep RBA rate hikes firmly on the table. Read More.

Gold and Silver Recover as US Extends Iran Ceasefire, But Technical Weakness Emerges

Ceasefire relief helped stabilize Gold and Silver—but technical cracks are forming. The next move depends on whether support levels hold. Read More.

USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 158.80; (P) 159.28; (R1) 159.87; More...

USD/JPY is still gyrating in range below 160.45 as consolidations continues. Intraday bias stays neutral for the moment. Further rise is expected with 157.49 cluster support (38.2% retracement of 152.25 to 160.45 at 157.31) intact. On the upside break of 160.45 will target a retest on 161.94 high. However, firm break of 157.31/49 will bring deeper fall back to 61.8% retracement at 155.38 next.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 153.80) holds. Firm break of 161.94 will pave the way to 61.8% projection of 102.58 to 161.94 from 139.87 at 176.75.

• The conflict in the Middle East has altered the dynamics of the oil market.
• The longer the Strait of Hormuz remains blocked, the higher the risks of a Brent rally.

Don’t expect things to return to normal. Before the conflict in the Middle East, the oil market was in the hands of the bears. Demand was falling due to the shift towards alternative energy sources, whilst supply was rising. OPEC+ was gradually increasing production to avoid losing market share and investors were talking about a record surplus. Today, the IEA estimates the loss of supply at 12 million barrels per day, which is more than during the Arab oil embargo of 1973–1974 and the Iranian Revolution of 1978–1979 combined. However, it would be rather naive to think that the end of the war will cause prices to plummet.

Even after the Strait of Hormuz reopens, it will take months to restore production in the damaged energy infrastructure of the Persian Gulf. At the same time, countries are seriously concerned about energy security and will work hard to boost oil demand. Interestingly, the current decline in demand is preventing Brent from soaring too high.

Vitol, a crude oil trader, estimates a demand loss of around 4 million barrels per day due to excessively high prices. If we add Saudi Arabia’s workarounds, the increase in US crude exports, and active purchases by China and India of Russian barrels stranded at sea, then the stabilisation of Brent near $100 starts to look logical. The math suggests that the actual deficit is closer to 5% than 10%.

The problem is that the crude on Russian tankers at sea is running out, the US’s ability to ramp up supply is limited by existing infrastructure, and a resumption of fire in the Middle East could lead to the Houthis blocking Saudi Arabia’s alternative routes. With this background, Citi’s forecast of Brent rising to $110 a barrel should the Strait of Hormuz be blocked for another month will seem far too modest.

The longer the US and Iran delay reaching a peace agreement, the more devastating the oil crisis risks being for the global economy. However, optimism has not yet faded. Investors are operating on the assumption that ‘it could be worse’. A fragile peace in the form of an indefinite ceasefire is better than war. The transit fee paid to Iran is seen as compensation for the bombing of its territory.

• Congress is in no hurry to confirm Warsh.
• US-Iran talks have broken down.

The US dollar has launched a counter-offensive thanks to the breakdown of US-Iran talks and a 1.7% month-on-month rise in retail sales in March. The economy is strong, oil prices are high and could rise even further, whilst the futures market is pricing in a 64% probability that the key rate will remain at 3.75% until the end of the year. This is all the more so given that Congress intends to throw a spanner in the works for Fed chair nominee Kevin Warsh.

In his address to lawmakers, Donald Trump’s nominee stated that the Fed should focus on core inflation. Meanwhile, some trimmed indicators suggest that prices are approaching the 2% target, although they are not quite there yet. The issue of the Fed’s independence deserves special attention, and Kevin Warsh has promised to make interest rate decisions independently and has stated that the President has not asked him to cut rates.

The appointment of a new Fed Chair will depend on the judicial investigation into Jerome Powell. While this is ongoing, the Republicans are not prepared to vote for him. The Kalshi forecasting market estimates the chances of a change in the Fed chairmanship by 15 May at 24%, and by 30 June at 65%. As long as Powell remains in the chair, market expectations are drifting towards a tighter policy stance, playing into the US dollar’s hands.

EURUSD continues to react to movements in oil and US indices. The surge in Brent and the fall in the S&P 500 in response to news that Iran had broken off negotiations with the US forced the euro to retreat. The president smoothed over the negativity with a statement on the indefinite extension of the ceasefire, which investors interpreted as a manifestation of TACO, or ‘Trump Always Chickens Out’.

At the same time, the Strait of Hormuz remains closed, which threatens to trigger a renewed rise in Brent prices and exacerbate the eurozone’s problems. Nevertheless, the fear of missing out has driven traders to the point where they are ignoring bad news. How long will this last?

The breakdown of US-Iran talks, as well as the postponement of the Bank of Japan’s expected rate hike, has put the initiative back in the hands of the bulls on USDJPY. 80% of 51 Bloomberg experts predict that the BoJ will hold steady in April. This contrasts with the March survey, when 37% of respondents expected monetary policy to be tightened at the next Governing Board meeting.