GOLD TECHS: Trading Above Monday’s Low

• A very busy Week ahead for multi Cross assets, the Week is packed with Data, Speakers, the ECB is also set to cut its Rate, and Bond traders will have to Roll their Eurex positions into the September Expiry (expiry Friday), without forgetting the continued uncertainty in the Tariff Wars.
• Already half the Volume in Bund is spread related, and 87% in the Schatz.
• The main focus on the Data front will be the US ISM Mfg, as the Manufacturing PMIs will be final reading for France, Germany, EU, UK, and US Today.
• The Focus this Week is back on the US Labour Data.
• SUPPLY: EU €2.5bn 2028 (equates to 40.2k Schatz) could weigh, EU 2033, 2042 (equates combined 31.9k Bund) could weigh into the bidding deadlines.
• SPEAKERS: Fed Powell, Logan, Goolsbee, BoE Greene, Mann.

• RES 4: $75.33 - High Feb 20 
• RES 3: $73.88 - High Apr 2 and a bull trigger
• RES 2: $69.73 - 61.8% retracement of the Apr 2 - 9 sell-off 
• RES 1: $65.31/66.30 - 50-day EMA / High May 13
• PRICE: $64.17 @ 07:06 BST Jun 2
• SUP 1: $62.09/57.78 - Low May 30 / Low April 9 and the bear trigger
• SUP 2: $55.88 - 2.236 proj of the Feb 20 - Mar 5 - Apr 2 price swing
• SUP 3: $54.70 - 2.382 proj of the Feb 20 - Mar 5 - Apr 2 price swing
• SUP 4: $54.00 - Round number support

The medium-term trend condition in Brent futures is unchanged and remains bearish - recent gains still appear to have been a correction. Attention is on $65.31, the 50-day EMA. It has been pierced. A clear break of the EMA would highlight a stronger bull cycle and expose $67.73, a Fibonacci retracement. On the downside, a stronger reversal lower from recent highs would open $57.78, the Apr 9 low.

The April trade surplus narrowed sharply and by a lot more than consensus expected due to a large jump in imports. The merchandise surplus stood at $150mn after $4327mn in March as imports rose 21.8% y/y up from 5.3% while exports rose only 5.8% y/y but still up from 3.2%. This was the worst balance since the Covid-impacted April 2020 deficit. 

• The YTD surplus was higher than the same period last year at $11.07bn compared to $10.13bn. YTD export growth just outpaced imports at +6.7% y/y compared to +6.3% y/y.
• The surge in goods import growth was broad based with capex +36.3% y/y, raw materials +18.9% y/y and consumer goods +18.5% y/y, signalling solid domestic demand.
• Annual export growth was driven by strong shipments of agricultural & fish products +59.8% y/y and manufacturing +13.9%, while mining & other fell sharply 20.7% y/y, as coal fell. The data is nominal and so is also impacted by price changes.
• Non-oil exports to the US sank 20.9% m/m with the annual rate rising 18.4% y/y due to earlier frontloading of shipments to beat tariff deadlines. Indonesia posted at $1.3bn surplus with the US. Exports to China are up 12.9% y/y but down 15% y/y to Japan.
• In terms of services exports, April tourist arrivals rose 9.2% y/y.