AUSSIE BONDS: Richer Ahead Of FOMC Decision

Oil prices are down sharply again today but off the intraday lows. The continued pullback in risk and concerns over the impact of increased trade protectionism on global demand pressured crude but selling fatigue and profit taking as well as the will from a number of Asian countries to negotiate with the US and stabilise markets saw a levelling out and a modest pickup. The USD index is off its highs to be down 0.1% today.

• WTI is down 2.3% to $60.54/bbl after it approached $61.00. It reached $59.38 earlier but has struggled to hold moves below $60. Brent fell to $63.01 earlier finding support here and then rose towards $64.50. It is now down 2.4% to $63.98 today.
• Saudi Arabia’s decision to reduce its benchmark Arab Light by $2.30/barrel for Asia in May, the most in over two years, added to the tariff pressure on oil markets today. It also cut prices to Europe and the Americas but not by as much. This follows OPEC’s higher-than-expected increase in production.
• Goldman Sachs cut its Brent forecast for the second time in a week. December 2025 has been revised down $4 to $62/bbl, according to Bloomberg, due to US trade policy risking a recession in the US and possibly elsewhere. GS is now forecasting stagnation in the US with risks to the downside.
• China, the world’s largest oil importer, said that it would use policy to defend its economy and urged markets not to panic. It also hasn’t ruled out negotiating with the US.
• Later the Fed’s Kugler speaks on inflation and the ECB’s Cipollone appears. US February consumer credit, German February trade/IP, February euro area retail sales and Canadian BoC business survey print.

• Gold has benefited more than most in the trade war build up yet with it now in full swing, even it is suffering.
• Gold delivered only its second weekly fall for the week last week for 2025, falling by -1.52% as a general commodities rout occurred with London’s Metal Exchange having the biggest decline since early 2020.
• Having reached highs of $3,134.17 at the start of last week, gold saw forecasters restating their year-end forecasts higher and higher.
• Gold broke through $3,000 this morning at the open trading as low as $2,971.30 before bouncing back to $3,028.15.
• Gold has traded through the 20-day EMA of $3034.60 and held, with its next key technical level the 50-day EMA of $2,947.07

• RES 4: 1.1276 High Jul 18 ‘23 
• RES 3: 1.1214 High Sep 25 2024 and a key resistance 
• RES 2: 1.1188 0.764 proj of the Feb 28 - Mar 18 - 27 price swing  
• RES 1: 1.1144 High Oct 1 2024 / High Apr 3    
• PRICE: 1.0982 @ 05:47 BST Apr 7
• SUP 1: 1.0882 Intraday low     
• SUP 2: 1.0824 20-day EMA     
• SUP 3: 1.0733 Low Mar 27 and a key short-term support     
• SUP 4: 1.0684 50-day EMA and a short-term pivot level

EURUSD has pulled back from last week’s high. The trend condition remains bullish and a move lower is considered corrective. Recent gains resulted in the break of key resistance at 1.0955, the Mar 18 high, confirming a resumption of the uptrend. It paves the way for a climb towards 1.1188 next, a Fibonacci projection. MA studies are in a bull-mode position highlighting a dominant uptrend. Initial firm support lies at 1.0824, the 20-day EMA.