LATAM FX: Regional Currencies Outperform Amid Easing Of Trade Tensions

• Stocks continue to retreat from midmorning highs, the DJIA, SPX emini and Nasdaq are in the red. Currently, the DJIA trades down 20.13 points (-0.05%) at 37943.95 (39,426.60 high), S&P E-Minis down 32 points (-0.63%) at 5064.75 (5,305.25 high), Nasdaq down 159 points (-1%) at 15443.37 (16,316.16 high). This morning's strong risk-on tone started to evaporate after the White House confirmed the 104% tariff on China went into effect at noon.
• Materials and Energy sectors continued to underperform in late trade: Albemarle Corp -10.57%, LyondellBasell Industries -4.98%, Dow Inc -4.32% and PPG Industries -4.03% weighed on the Materials sector.
• The Energy sector was weighed by oil and gas shares under pressure as crude prices fell in late trade (WTI -1.47 at 59.23 -- 4Y lows): APA Corp -5.21%, Occidental Petroleum -5.14%, Devon Energy -4.54%, Diamondback Energy -2.59% and EOG Resources -2.51%.
• Financials and Utility sectors outperformed in late trade, insurance names buoyed Financials: Everest Group +2.89%, Progressive Corp +2.51%, Arch Capital Group +2.27% and W R Berkley +2.21%.
• Meanwhile, alternative energy providers supported the Utility sector: Constellation Energy +3.24%, Atmos Energy +1.43%, Vistra +1.09% and Public Service Enterprise +0.93%.
• Reminder, banks kick off the latest earnings cycle this Friday with Bank of New York Mellon, Wells Fargo & Co, JPMorgan Chase and Morgan Stanley reporting.

• WTI has returned to losses after the White House Press Secretary confirmed imposition of 104% tariffs on Chinese imports, offsetting concerns of a shutdown on the Keystone pipeline.
• WTI May 25 is down by 2.3% at $59.3/bbl.
• A bearish theme in WTI futures remains intact following the recent impulsive sell-off. The move down has resulted in the breach of a number of important support levels, with sights on $57.79 next, a Fibonacci projection.
• Meanwhile, spot gold has erased earlier gains amid the renewed tariff threat, with the yellow metal currently unchanged at $2,983/oz.
• The trend condition in gold remains bullish and the recent pullback from record highs appears to be corrective. The next key support to watch lies at $2,946.9, the 50-day EMA. The bull trigger is $3,167.8, the Apr 3 high.
• Copper has also erased earlier gains as fears of a prolonged US-China trade spat mount, with the red metal now 1.3% lower on the session at $413/lb.
• Trade war fears rose as USTR Greer stated that tariff exemptions will not come through in the near-term, coming on top of concerns over a prolonged trade spat between the US and China.
• Copper has now fallen by almost 15% since last week’s tariff announcements, highlighting an acceleration of the current bear cycle.
• Key support at $403.85, the Jan 2 low, has been pierced. A clear break would strengthen a bearish theme and open $392.10, the Aug 7 ‘24 low.

• RES 4: 165.43 High Nov 8        
• RES 3: 164.90 High Dec 30 ‘24 and a key medium-term resistance   
• RES 2: 164.55 High Jan 7
• RES 1: 162.37/164.19 High Apr 7 / High Mar 18 and the bull trigger 
• PRICE: 160.37 @ 16:31 GMT Apr 8 
• SUP 1: 158.30 Low Apr 7   
• SUP 2: 157.02 76.4% retracement of the Feb 28 - Mar 18 bull cycle  
• SUP 3: 155.60 Low Low Mar 4  
• SUP 4: 154.80 Low Low Feb 28  

EURJPY is trading in a volatile manner. The latest pullback still appears corrective, and the strong rally off Monday’s low reinforces this theme. Key short-term support has been defined at 158.30, Monday’s low. A break of this level is required to signal scope for a deeper retracement. For bulls, the cross has traded through the 20-day EMA. A continuation higher would expose 164.19, the Mar 18 high and the bull trigger.