FOREX: Asia FX Wrap - Quiet Session
The BBDXY has had a range of 1211.72 - 1214.14 in the Asia-Pac session, it is currently trading around 1214. "NATO is pushing European members to expand ground-based air-defense capabilities fivefold in response to the threat of Russian aggression, people familiar said. Trump will attend the alliance’s summit in The Hague later this month, the White House said.”(BBG)
- EUR/USD - Asian range 1.1366 - 1.1393, Asia is currently trading 1.1370. EUR has drifted sideways during the Asian session. Dips should continue to find support, the demand back towards 1.1200 proved to be solid last week.
- GBP/USD - Asian range 1.3513 - 1.3545, Asia is currently dealing around 1.3515. The GBP is attempting another run higher but is struggling to gain any momentum on a 1.3500 handle. Look for an opportunity to buy again back towards the 13300/3400 area if seen.
- USD/CNH - Asian range 7.1829 - 7.1944, the USD/CNY fix printed 7.1886. Asia is currently dealing around 7.1915. Sellers should be around on bounces while price holds below the 7.2500 area.
- Cross asset : SPX -0.07%, Gold $3356, US 10-Year 4.44%, BBDXY 1214, Crude oil $63.13
Data/Events : Spain Industrial Production & Services PMI, Italy Serv PMI, France Serv PMI, Germ Serv PMI, EC Serv PMI
Fig 1: GBP/USD Spot Daily Chart
Source: MNI - Market News/Bloomberg
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ASIA STOCKS: Mixed Day with Key Markets Closed
With the larger markets of South Korea and China out today for public holidays, those bourses open were mixed as currencies were the focus. Ongoing USD weakness saw regional currencies perform strongly with several up over 1% today.
- Despite a very strong day for the TWD, the TAIEX started the week on the backfoot down -0.75% today, following on from last week’s strong gains.
- In Malaysia, the FTSE Bursa Malaysia KLCI fell -0.45% following posting strong positive gains last week.
- The Jakarta Composite was up +0.50% following three successive weeks of very strong gains.
- Singapore’s FTSE Straits Times delivered modest gains of +0.10% as did the PSEi in the Philippines which rose +0.25%.
- India’s NIFTY 50 has enjoyed strong inbound FDI of late and lasts week rose +1.28% to mark three successive weeks of gains and has started this week off strongly up +0.50%
EURUSD TECHS: Corrective Cycle Remains In Play
- RES 4: 1.1696 1.618 proj of the Feb 28 - Mar 18 - 27 price swing
- RES 3: 1.1625 1.500 proj of the Feb 28 - Mar 18 - 27 price swing
- RES 2: 1.1608 High Nov 9 2021
- RES 1: 1.1440/1573 High Apr 23 / 21 and the bull trigger
- PRICE: 1.1337 @ 05:57 BST May 5
- SUP 1: 1.1264 20-day EMA and a key support
- SUP 2: 1.1144 High APr 3
- SUP 3: 1.1036 50-day EMA and a pivot level
- SUP 4: 1.0805 Low Apr 3
A corrective cycle in EURUSD remains in play. The trend structure is unchanged, it remains bullish. MA studies are in a bull-mode position signalling a dominant uptrend, and the latest move down is allowing an overbought condition to unwind. A resumption of gains would open 1.1608, the Nov 9 2021 high. Initial key support to watch is the 20-day EMA, at 1.1264. A break of this average would signal scope for a deeper pullback.
GOLD: Gold Jumps on USD Weakness
- Gold jumps in Asian trading to deliver +0.45% gains as further USD weakness continued.
- Gold had its worst week since late February as news of potential trade agreements gave markets a boost and pushed some equity bourses back above pre tariff announcement levels.
- Gold was down -2.39% for the week, and opened today in Asia at US$3,239.76 rising to $3,255.46.
- South African miner Gold Fields Ltd will buy Gold Road Resources Ltd for a purchase price of A$3.7bn to conclude several weeks of negotiations.
