EURUSD TECHS: Bullish Theme Intact
- RES 4: 1.1185 High Mar 31 2022
- RES 3: 1.1076 High Apr 1 2022
- RES 2: 1.1033 High Feb 2 and key resistance
- RES 1: 1.0973 High Apr 4
- PRICE: 1.0932 @ 19:35 BST Apr 6
- SUP 1: 1.0883 Low Apr 4
- SUP 2: 1.0802/0788 20-day EMA / Low Apr 3
- SUP 3: 1.0730 50-day EMA
- SUP 4: 1.0631 Low Mar 20
EURUSD maintains a firmer tone. Price has this week breached resistance at 1.0930, the Mar 23 high. This level marked a key short-term hurdle for bulls and the clear break reinstates the recent bull theme and signals scope for 1.1033, the Feb 2 high. On the downside, support to watch lies at 1.0802 (20-day EMA) and 1.0730 (50-day EMA). A move through this support zone would be bearish.
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SWITZERLAND: SNB' Jordan Says Inflation Is Significantly Too High
- SNB’s Jordan speaking about the Swiss economy and monetary policy at an event hosted by the University of Zurich. Comments as follows:
- SNB must act to reach price stability in medium term
- Swiss economy slowing but labor market dried up
- SNB's monetary policy is still too loose
- Cannot exclude that we have to further tighten
- Inflation is significantly too high
- We can raise rates but also sell FX
- Our forecasts currently have very high uncertainty (BBG)
- A very minor downtick in EURCHF since the governor has begun speaking, slipping back into negative territory on the session and narrowing the gap with the overnight lows of 0.9926.
- Overall, following the stalled momentum above the 1.00 mark for EURCHF, attention may now turn to the February lows around 0.9847 as we approach the central bank’s next meeting on March 23.
CANADA: Front GoC Yields Nearing To Triple Top Resistance
- Front GoC yields have pushed to new session highs, above the initial post-Powell spike, as they follow Treasury yields higher after the 3Y auction.
- At 4.315% (+6.7bps on the day), the 2Y GoC yield approaches cycle highs forming a triple top just shy of 4.34% (topping out with 4.338 on Feb 27).
- Ahead of tomorrow’s BoC decision (unanimously expected unchanged), the yield sits 68bps higher than before the Jan 25 decision, dragged higher by the US higher for longer rates push as opposed to local factors with mixed data and its newly adopted conditional pause.
2Y GoC yieldSource: Bloomberg
GBPUSD TECHS: Bear Threat Unfolds
- RES 4: 1.2244 61.8% retracement of the Jan 23 - Feb 17 bear leg
- RES 3: 1.2182 High Feb 15
- RES 2: 1.2147 High Feb 21 and a key short-term resistance
- RES 1: 1.2060 20-day EMA
- PRICE: 1.1874 @ 16:09 GMT Mar 7
- SUP 1: 1.1866 Low Mar 7 and key short-term support
- SUP 2: 1.1842 Low Jan 6 and a reversal trigger
- SUP 3: 1.1783 2.0% 10-dma envelope
- SUP 4: 1.1764 Low Nov 17
GBPUSD slipped lower Tuesday amid a broad USD strength backdrop. This retains the bearish trend condition and support at 1.1915, the Feb 17 low, gave way. Clearance here confirms a resumption of the bear leg and exposes key support at 1.1842, the Jan 6 low. A break of this key price point would highlight a broader medium-term reversal threat and a potential double top pattern on the daily chart. Key short-term resistance is unchanged at 1.2147, Feb 21 high
