EURUSD TECHS: Support Remains Intact

ACGBs (YM +2.0 & XM +7.0) are showing a bull flattener in today’s Sydney session.

• The release of the RBA Minutes for the April Meeting was the key domestic driver. The Board judged that economic conditions were broadly in line with forecasts, with inflation gradually declining and the labour market still tight.
• Risks to the outlook were seen as balanced, including global trade uncertainty and domestic factors like wages and productivity.
• Given this, the Board decided to keep the cash rate unchanged, emphasising the need for caution. Future decisions will depend on incoming data, especially on inflation, employment, and global developments.
• Cash US tsys are flat to 4bps richer, with a flattening bias, in today's Asia-Pac session.
• Cash ACGBs are 1-7bps richer with the AU-US 10-year yield differential at -2bps.
• The bills strip has bull-flattened, with pricing flat to +6.
• RBA-dated OIS pricing is flat to 3bps softer across meetings today. A 50bp rate cut in May is given a 36% probability.
• Tomorrow, the local calendar will see the Westpac Leading Index, ahead of March’s Employment Report on Thursday.
• The AOFM plans to sell A$1000mn of the 3.50% 21 December 2034 bond tomorrow. 

• RES 4: 1.3305 High Oct 2 ‘24  
• RES 3: 1.3274 High Oct 3 ‘24  
• RES 2: 1.3207 High Apr 3 and the bull trigger
• RES 1: 1.3218 Intraday high        
• PRICE: 1.3214 @ 06:08 BST Apr 15
• SUP 1: 1.2934/1.2709 20-day EMA / Low Apr 7 and a bear trigger  
• SUP 2: 1.2688 2.0% 10-dma envelope
• SUP 3: 1.2654 50.0% retracement of the Jan 13 - Apr 3 bull cycle
• SUP 4: 1.2559 Low Feb 28 

GBPUSD maintains a bullish tone and the pair is trading higher today. Price has pierced key resistance at 1.3207, the Apr 3 high and a bull trigger. This confirms the end of the recent Apr 4 - 7 correction, and highlights a resumption of the medium-term uptrend. Moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.3274 next, the Oct 3 ‘24 high. Support to watch is 1.2934, the 20-day EMA. 

A BBG report suggests that the escalating trade war is having a material impact on the money investors have placed in Chinese ETFs.  Data suggests that US$3.6bn has been withdrawn in early April following the imposition of tariffs. 

Alibaba and Tencent backed Zhipu has begun an initial public offering as soon as this year, angling to become the first of several prominent ChatGPT-competitors to tap public markets.

Many of Asia’s bourses rose today with the US President floating a potential tariff pause, giving autos a reprieve.  

• China’s bourses were the exception today.  As the Hang Seng edged higher by +0.20%, the onshore bourses drifted lower with CSI 300 down -0.07, Shanghai down -0.07 and Shenzhen down -0.48%
• The KOSPI had a very strong day today rising +1%, following on from yesterday's gain of +0.95%.
• Singapore’s FTSE Straits Times was one of the regions best performers rising +1.8%, following yesterday’s gain of +1.04%.
• Malaysia’s FTSE Bursa Malaysia KLCI is holding onto modest gains of +0.20% following yesterday's outsized rally of +1.79%.
• The Jakarta Composite is up yet again and continues to perform well, rising +1.3% today, from yesterday’s gains of +1.70%.
• India’s NIFTY 50 has risen +2.1% in early trading, following on from yesterday’s gains of +1.92%.