Trump’s decision towards imposing tariffs on allies continues to influence price action of major assets in the market. Traders await macro data for short term trading cues while geo-political events provide directional influence.
Summary: US Wall Street last night opened subdued amid disappointing macro data from China and US which pressured US T.Yields. However, news of delay in US President Trump’s plans for imposing tariffs on European auto imports helped offset early loss helping Wall Street indices close in Green. US tariff on China’s Huawei added fuel to fire in ongoing Sino-U.S. trade war which caused Asian indices to decline slightly but all major markets – China, Singapore and Hong Kong closed on positive note. European indices are also trading in green given positive influence in market over US decision to delay tariff plans. While tensions surrounding U.S. decision to blacklist Huawei caused market to sway earlier in the day, all major indices and equities continue to trade in green indicating healthy risk appetite in the market today. In forex markets, USD denominated major global currencies are seeing some level of positive price action but gains remain limited.
Precious Metals: As risk appetite returned to market, precious metals saw dovish price action. However, US decision to blacklist China’s Huawei fuelled tensions surrounding Sino-U.S. trade war which fuelled some level of safe haven demand capping downward price action. Both silver and gold are expected to see range bound price action with slight bearish bias for rest of the day.
Crude Oil: Crude oil price trades with positive bias today and is up more than 1% in the global market. OPEC enforced supply cuts, increased tensions between US and Iran over US decision to call back all non-emergency diplomatic staff to US, attacks on multiple Saudi Arabian crude oil shipments and pipelines add concerns of supply disruption in the market influencing positive price action.
USD/JPY: The pair remains trapped within weekly price range. But USD has gained slight upward momentum in current session as US decision to delay auto tariff boosted risk appetite while US decision to blacklist Huawei capped prospects for gains resulting in pair seeing range bound price action with positive bias.
On The Lookout: Geo-political issues remain in focus. US continue to wage trade war against its major allies but the main focus remains on China. While US has decided to continue trade talks with China, it is trying various intimidation tactics to try and make china submit to its demand and possibly sign a trade deal. However, China remains stubborn in its stance and won’t submit to US demands unless they seem to benefit China in some way or doesn’t affect their business and economy too much. Traders continue to exercise caution as US’s tactics could likely cause China to respond with retaliatory tariffs. In the meantime, investors focus on macro data updates for short term profit opportunities and directional cues. Some of most notable updates ahead include US Philadelphia Fed manufacturing index and Bank of Canada Governor Stephen Poloz’s speech.
Trading Perspective: Prevalent risk on mood in the market is likely to reflect in Wall Street’s price action today. Forex market will continue to see range bound action as cautious investor tone limits possibility for sharp move on either side.
US Market: US index futures trading in the international market were positive ahead of Wall Street opening. Positive influence from update hinting at delay in auto tariff improved risk appetite in the market. But caution owing to escalating Sino-U.S. trade tensions may limit gains. Earnings influenced rally could inspire some level of strength for market bulls in early trading session.
EURUSD Daily Chart
EUR/USD: While Italian debt woes continue to pressure Euro, the pair managed to gain positive bias on news of Trump’s decision to delay auto tariffs. However, Sino-U.S. trade tensions escalate on US decision to blacklist Huawei. The pair remains at mercy of USD bulls and Trump’s decision resulting in the pair struggling to hold fort at 1.12 handle while waiting for US macro data for short term trading cues.
USD/CAD: Canadian Dollar has managed to regain upper hand as crude oil price regained positive momentum in the market. Escalating tensions in the Middle East suggest that crude oil price may remain high in near future. This is positive factor for commodity linked currency Loonie. Traders now await US macro data for short term trading cues. Meanwhile, prevalent risk appetite in the market suggests continued rally in favor of CAD.
Despite caution on escalating trade war tensions between China and U.S. optimistic comments from China and US helped improve risk appetite influencing positive activity in European markets.
On The Lookout: Sino-U.S. trade war related headlines remains in focus today. So far both parties have expressed willingness to continue trade related negotiations and US President Donald Trump is expected 
Dovish cues from US Wall Street and Asian markets amid holiday thin activity in Asian markets influenced bearish price action in European markets despite most major indices and equities opening positive today.
On The Lookout: Macro data calendar schedule for US remains relatively silent today. European market saw release of PMI updates which mostly had positive outcome. While European equities traded positive earlier in the day, most major benchmark indices turned dovish ahead of US Wall Street opening. US market will see release of Preliminary Q1 Nonfarm productivity data and Unit labour costs data and Factory orders data for March which is likely to keep price action volatile to some extent in Wall Street today. Headlines suggests positive progress on Brexit front, while Sino-U.S. trade talks is yet to see any new unique headlines hit market post US representatives visit to China earlier this week. Cues from geo-political events will continue to remain as the main driving force behind the price action in major global markets the week ahead.
Global market today saw positive price action on increased hopes for trade deal between US and China. Investors wait for US macro data for short term directional cues.
On The Lookout: As trading session comes to close for the week geo-political events remain the main focus of investors across the globe. Optimism surrounding Sino-U.S. trade talk is recovering once again post comments from US President Donald Trump who commented that trade deal will be signed between two nations within four weeks time. While there haven’t been any clear details on what topics are being discussed between delegated on two nations, news hinting at timeline for trade deal is a welcome update. Meanwhile on European side, Brexit deadline is fast approaching with UK political climate still remaining in dire straits and lawmakers indecisive nature hampering progress in Brexit. While amendment has been passed to approve another request for deadline extension, PM May is yet to contact EU for Brexit extension request. In immediate future as trading session comes to close for the day investors focus is on US and Canadian macro data updates for short term directional bias and profit opportunities.
Asian equities fell on risk averse trading activity, but hopes for UK parliament voting against no-deal Brexit outcome helped European markets erase early loss. Investors now eye US macro data for directional cues.
On The Lookout: The majority of focus of global investors and traders in short term is on US macro data scheduled to release for the day as the outcome of same will help USD gain a directional bias for price action for remaining trading sessions of the week. However, the main focus still remains on UK parliament session as key decisions relating to Brexit is still under consideration and is expected to be vote upon during parliament meeting today and tomorrow. While EU has stated that they are unlikely to grant extension for Brexit deadline unless UK provides credible justification as EU members view rejection of the deal in negative light. However, if UK parliament rejects no-deal exit outcome and votes on extension of deadline during tomorrow’s meeting the request is likely to be granted by EU for a short duration as disorderly Brexit will lead to huge economic losses on both sides. Further, investors hope that UK lawmakers would push for second Brexit referendum as current scenario suggests that Brexit will lead to irresolvable mess which may extend indefinitely. Any news of second Brexit referendum will not light fire under market bulls while just avoiding no-deal exit and extending deadline will lead to range bound price action for rest of the day. On release front today, US macro calendar will see the release of PPI, core durable goods order and Crude Oil inventory data.
AUD/USD: The pair is seeing two way price action today as bulls on both sides of currency pair have some level of fundamental support. While macro data in Australia was mixed the PMI’s were positive and RBA maintained neutral stance and comments mirrored last month’s sentiment. However, Dollar’s strength supported by US T.Yields and disappointing Chinese macro data added dovish influence to AUD resulting in pair falling from intra-day highs to lows and both sides waging war for control resulting in range bound price action.
Sino-U.S. trade optimism has influenced a fresh wave of bullish price action in global market resulting in positive activity in 
Healthy risk appetite over positive progress in key geo-political issues inspire positive price action ahead of Fed meeting minutes which is expected to provide short term directional cues.
Trading Perspective: Increased risk appetite amid escalating political tensions in US and Europe are likely to result in range bound activity with bullish bias.
Divided investor sentiment continues to limit positive price action in broad market on most major assets. But hopes on positive outcome in future talks following comments from representatives of China & U.S. has inspired a temporary phase of positive activity in broad market.
On The Lookout: As trading session approaches week’s closing, all major events and high impact macro data updates have already hit the market. Two most anticipated events of the week ended in stalemate and investors now look forward to proceedings of events scheduled to occur later in the month. But given current status of both events, the outcomes look in unfavorable direction and could lead global market into another great phase of decline if resolution is not found by March deadline. For the day ahead, U.S. Calendar is set to see second tier macro data updates which are expected to provide short term profit opportunities as trading session closes for the week. However they are unlikely to have any major impact as proceedings of geo-political events dictate price momentum for now.
On The Lookout: The main focus of investors is now towards Sino-U.S. trade talks scheduled to occur later today. Given the fact that key issue – intellectual property rights handling is to be addressed in the meeting, a positive outcome is likely to result in trade deal between two nations as both economies have suffered significantly owing to ongoing trade wars. On release front, today’s U.S. calendar is silent for the day. Price action is likely to be influenced by news driven momentum in Wall Street today.
