Asian stocks finished lower from nine months highs, after worse than expected figures from Japan. Sino-US trade relations were in focus again today as White House economic adviser Larry Kudlow said “very good progress” was being made in talks. The Nikkei225 main index lost 0,89 percent to 22,080, the Hang Seng benchmark in Hong Kong finished 0.46 percent lower at 29,982. Chinese stocks also finished lower, with Shanghai Composite finishing 0.12 percent lower at 3,259, and in Singapore, the FTSE Straits Times index finished 0.17 percent lower at 3,342. Australian equities fell after climbing 25 points at its best levels, those gains were erased following the strong jobs numbers for March. The index edged 3 points higher to 6259.8 and lifting 0.14%for the week.
In commodities markets, Crude oil retreated from recent high at 63.73, boosted by OPEC’s ongoing supply cuts, geopolitical uncertainty and the US additional sanctions on Iran. The near-term upside target for black gold is at the 65.00 figure, but I expect some profit taking, which can drive the price down to $61. Brent oil is also giving up some cents down to $71,54 per barrel. Gold’s bearish momentum is still intact hitting yesterday the $1271 figure, the lowest levels since April 1st just to start a mild rebound during the Asian session to $1274. XAUUSD‘s technical picture is negative and now strong support stands at the 200-day moving average down to $1250, which if broken can accelerate the downward move to 1200 as sellers are in full control. Strong resistance stands at the $1300 round figure and then at the 50-day moving average around $1305.
European session started in bearish mood following an uninspiring session in Asian markets. DAX30 is 0.20 percent lower to 12,133, CAC40 is 0.40 percent lower at 5,541 while FTSE100 in London is 0.31 percent lower at 7,448, and the FTSE MIB in Milan is trading 0.78 percent lower at 21,839.
In cryptocurrencies market, Bitcoin (BTCUSD) continues its up and down around the key 200-day moving average at $5,153, currently trading at $5,259 making the daily low at 5,195 and daily high at 5,292. BTCUSD found strong support at the $5,000 level and started the rebound from that figure. Bitcoin immediate support stands at the 50-day moving average at 4,089. Ethereum (ETHUSD) also trades higher to 170, and it is placed nicely above the 100-day moving average, facing strong resistance at 193, the 200-day moving average, while Litecoin (LTCUSD) also follows higher at 80.87. The cryptocurrencies market cap holds above $160.0B.
On the Lookout: Fitch Ratings published its credit review report on the Australian economy, confirming the sovereign rating at AAA with a Stable outlook. Here are the key points: “Momentum in the Australian economy has decelerated in the near term, but still compares well with AAA peers. The slowdown of the Australian economy is due in part to spillovers from the weakening housing market on dwelling investment and household consumption. It expects ongoing housing market correction in Australia to remain orderly. Fitch forecasts Australia’s debt to GDP to begin a downward trajectory in light of the improvement in fiscal performance. Australia’s banking system is well positioned to manage a housing market shock. Australia’s monetary policy is likely to remain accommodative to support economic growth and employment.”
The Japan Nikkei Manufacturing PMI came up to 49.5 in April from the previous 49.2. Yesterday, according to the Department of Commerce, the US trade deficit on goods and services shrank in March at a pace of 3.4% month-on-month to reach $49.4bn (consensus: -$53.6bn), amid a pickup in sales of civilian aircraft.
Fitch Ratings in its latest review on the New Zealand economy, reports that Capital proposals are unlikely to affect New Zealand’s major bank franchises. High household debt in New Zealand is broadly stable but is a key risk. Expect modest deterioration in asset quality in New Zealand over the next year, in part because impaired loan levels are around historical lows. The banks’ strong domestic franchises allow for a stable business model that helps offset continued high macroeconomic risks in New Zealand.
In the macro calendar from Americas today, we have the US retail sales, weekly jobless claims, Philly Fed manufacturing index slated for release at 12:30GMT alongside the releases of the Canadian retail sales and ADP jobs, which will keep the NA traders busy from the onset. At 13:45GMT, the US manufacturing and services PMIs will be published by Markit, followed by the US business inventories data at 14:00GMT. Meanwhile, the speech by the FOMC member Bostic will wrap up a data-heavy Good Friday week.
Trading Perspective: In Forex markets, US dollar is trapped between 96.40 and 96.65, while AUDUSD continues higher for the second day adding 0.084 percent to 0.7189 as Fitch Ratings confirmed the sovereign rating at AAA with a stable outlook. The pair needs to break convincingly above the 200-day moving average at 0.7195 to establish a long term positive momentum. Kiwi underperforms for one more day and trades 10 pips lower at 0.6722.
GBPUSD: The pair slips lower today as the volatility remains at monthly low, losing the short term momentum and trading at 1.3040 below the 200-hour moving average. On the downside, major support will be found at 1.2975 at the 200-day moving average while solid protection can be found at the 100-day moving average around 1.2942. On the flipside, immediate resistance stands at 1.3195, the high from previous week session, and from there, a major resistance can be found at 1.3232, while 1.3382, the yearly high, will be met with strong supply.
EURUSD trades up and down around the 1.13 level. The pair made the Asian high at 1.1304 and the low at 1.1289. Euro holds above the 50-day moving average and on the upside is targeting the 100 DMA at 1.1345. Immediate support can be found at the 50-hour moving average around 1.1290, and further bids will emerge at 1.1281 and the 200-hour moving average.
European equities remain in negative mood following recent poor figures in Eurozone. In fact, recent disappointing readings in the region somehow confirm that the slowdown in the bloc and the ‘patient-for-longer’ stance from the ECB could be among us for longer than expected.
USDJPY is trading just below the 112 zone, having hit the low at 111.83 and the high at 112.06. Major support for the pair stands at 111.51, the 200-day moving average, and then at the 111 round figure if the pair manages to break below the 100-day simple moving average at 111.10. Immediate resistance for the pair stands at 112.10, the March 2019 high.
USDCAD made the opposite move from yesterday, as it rebounds from yesterdays low at 1.3318 to 1.3352 as oil prices retreat from recent highs. The pair will find immediate support at the 100-day moving average around 1.3315 while extra support stands at 1.3196, and the 200-day moving average which if breached will drive prices down to 1.31 key support. On the upside, immediate resistance stands at 1.34 a break of which can escalate the rebound towards 1.3430.