COMMODITIES: Crude Falls, Precious Metals Pull Back

• RES 4: 149.28 High Apr 3    
• RES 3: 148.03 50-day EMA 
• RES 2: 145.25 20-day EMA
• RES 1: 142.25/143.28 High Apr 21 / 16   
• PRICE: 140.78 @ 16:18 BST Apr 22
• SUP 1: 139.79 1.382 proj of the Feb 12 - Mar 11 - 28 price swing
• SUP 2: 138.82 1.500 proj of the Feb 12 - Mar 11 - 28 price swing
• SUP 3: 138.07  LowJul 28 ‘23
• SUP 4: 137.85 1.618 proj of the Feb 12 - Mar 11 - 28 price swing

The trend condition in USDJPY remains bearish and this week’s fresh cycle lows reinforce this condition. The extension down confirms a resumption of the downtrend and maintains the price sequence of lower lows and lower highs. Note too that moving average studies are in a bear-mode position highlighting a dominant downtrend. Sights are on 139.79 next, a Fibonacci projection. Initial firm resistance to watch is the 20-day EMA, at 145.25.

• RES 4: 0.8800 Round number resistance      
• RES 3: 0.8781 2.236 proj of the Mar 3 - 11 - 28 price swing
• RES 2: 0.8768 High Nov 20 ‘23
• RES 1: 0.8624/0.8738 High Apr 21/ High Apr 11 and the bull trigger 
• PRICE: 0.8580 @ 16:17 BST Apr 22 
• SUP 1: 0.8520 20-day EMA 
• SUP 2: 0.8477 61.8% retracement of the Mar 28 - Apr 11 rally  
• SUP 3: 0.8442 50-day EMA  
• SUP 4: 0.8415 76.4% retracement of the Mar 28 - Apr 11 rally

The latest pullback in EURGBP appears corrective - for now. The retracement has allowed a recent overbought trend condition to unwind. Support to watch lies at 0.8520, the 20-day EMA. Below this level, support at the 50-day EMA is at 0.8442. The area between these two averages represents a key support zone. For bulls, a resumption of gains would refocus attention on 0.8738, the Apr 11 high and bull trigger.

European FI had a constructive session in the return from a 4-day holiday Tuesday.

• Shrugging off Monday's US Treasury weakness, curves bull steepened early, continuing from Thursday's pre-holiday, post-ECB price action.
• OATs underperformed, with Bloomberg reporting that President Macron is considering calling a snap legislative election in France as soon as the autumn.
• In other developments, BOE's Greene sounded less hawkish on the rate outlook compared with her previous appearances, helping UK rate cut pricing deepen, while Eurozone flash April consumer confidence printed the weakest since November 2023.
• Yields saw a modest spike in the minutes ahead of the cash close on a Bloomberg report that US Treasury Secretary Bessent expects a de-escalation in US-China trade tensions.
• The UK curve bull steepened sharply, with Germany's bull flattening. Periphery EGB spreads were flat/slightly tighter to Bund.
• Tuesday's calendar highlight is flash April PMIs, while we also get UK public sector net borrowing data and an appearance by BOE's Pill, Bailey and Breeden.

Closing Yields / 10-Yr EGB Spreads To Germany

• Germany: The 2-Yr yield is down 2.5bps at 1.661%, 5-Yr is down 3.7bps at 1.982%, 10-Yr is down 2.9bps at 2.443%, and 30-Yr is down 3.7bps at 2.859%.
• UK: The 2-Yr yield is down 9bps at 3.83%, 5-Yr is down 6.4bps at 3.98%, 10-Yr is down 2.1bps at 4.545%, and 30-Yr is up 2.9bps at 5.368%.
• Italian BTP spread down 0.7bps at 116.6bps / French OAT up 1bps at 77.5bps