• Prior +3.7%
• Market index 214.4 vs 216.9 prior
• Purchase index 165.8 vs 169.1 prior
• Refinance index 461.2 vs 457.6 prior
• 30-year mortgage rate 6.50% vs 6.55% prior

Despite a drop in rates in the past week, mortgage activity declined mainly due to a slump in purchases – which were offset slightly by a rise in refinancing activity. Overall, it still points to weaker conditions in the mortgage market as it has been over the past year already since the Fed began aggressively hiking rates.

This article was written by Justin Low at www.forexlive.com.

It feels like a bit of déjà vu for the Fed as US regional banks come under pressure once again before they announce their next policy decision.

It will be a case once again where markets will look to the Fed decision and see if Powell will offer up any relief after the jitters from yesterday. The first thing traders and investors will be watching is the interest rate decision and whether the Fed will hike by 25 bps or not.

If the Fed does hike by 25 bps, the initial kneejerk reaction could see another heavy selloff in regional banks. At this point, markets can argue that policymakers will have to draw a line somewhere after yet another bank (First Republic) failed and there are increasing worries involving other banks like PacWest and Western Alliance.

Adding to that argument is the fact that the Fed tends to pacify markets and go with „what is expected“, so as to not upset the balance and order of things. This has been the mantra ever since Yellen took over and Powell has continued with that all through his tenure so far. That should be no different this time.

And if you take a peek through the looking glass, perhaps the decision to hike by 25 bps is the lesser of two evils.

Let’s say that the Fed chooses not to hike at all today. Firstly, that creates a serious credibility issue as it means that their resolve to combat inflation has wavered. That is not something markets would like to see at any point, I would say.

Then, what happens if regional banks still end up getting clobbered once we get to the Wall Street close? There is no fallback for the Fed in this instance. They will end up losing both credibility on the inflation front and also failing to appease markets as regional bank fears linger.

Whereas if they do hike by 25 bps, there is still that and Powell can then try his best to soothe markets by implicitly hinting at a pause in the tightening cycle.

It’s sort of a damned if you do, damned if you don’t kind of situation. I shared some other thoughts on the Fed decision here. What do you think the Fed should do and would do later today?

This article was written by Justin Low at www.forexlive.com.

On the daily chart below, we can
see that the price bounced near the key support at 0.6563 and eventually spiked
up as the RBA surprised with an interest rate hike. The price action remains
choppy as central banks are near the end of their tightening cycles and the
market is uncertain on what’s next.

The economic data keeps sending
conflicting messages and the volatility is high around the regional banking
woes in the US. AUD is sensitive to risk sentiment, so traders will need to
ride the ups and downs in the market’s mood.

AUDUSD
technical analysis

On the 4 hour chart below, we can
see more closely the ugly choppiness in the pair in the last 2 months. This may
be a big double
top pattern
within a correction which could be a stronger signal of a continuation to the
downside, but the risk sentiment should turn sour to make the price to break
below the support and increase the bearish momentum. Today we have the ISM Services PMI and
the FOMC policy announcement, so watch out.

On the 1 hour chart below, we can
see that the price is now consolidating in a little box testing the trendline and the 61.8% Fibonacci
retracement level. This is where the buyers should step in to
try another push to the upside. The sellers, on the other hand, will want to
see the price to break below the trendline to start piling in and target the
support at 0.6563 or even a new lower low.

This article was written by ForexLive at www.forexlive.com.

On the daily chart below for the
Nasdaq, we can see that after a brief fall below the range created just beneath
the key 12274 resistance, the price rallied back strongly
and it’s now back again at the resistance. The latest rally was helped by
better than expected data in the US
GDP report
and the beat in Jobless
Claims after several weeks of misses.

The bad news though is that the ISM
Manufacturing PMI yesterday beat forecasts and the inflation and
employment sub-indexes returned back into expansion. As long as employment
remains strong with a falling inflation the stock market can rise, but it’s
harder to do so when inflation remains persistently high as well as that may
force the Fed to keep hiking rates.

On the 4 hour chart below, we can
see that the buyers may still be targeting new higher highs with the big bullish
flag pointing to a 13000 extension. The latest bounce from the 50% Fibonacci
retracement level had no pullbacks and given that the price is
back at the key resistance and the ISM data yesterday is not that bullish, we
may see a pullback here and probably again some consolidation.

On the 1 hour chart below, we can
see the recent fakeout highlighted by the orange circle and then the rally back
towards the top of the range. This week is packed with top tier economic
events like the ISM PMIs, the FOMC and the NFP, so we may see another breakout
but the direction will be given by the data. More inflationary pressures should
be negative for the market, while strong labour market data with easing
inflationary pressures should be positive.

This article was written by ForexLive at www.forexlive.com.

• Some further tightening may be required to meet that objective
• We will do what is necessary to bring inflation back to target
• We are not on a pre-set course
• Paying attention to consumption, inflation, jobs, global economic developments
• Australian dollar had responded to change in rates outlook since April pause

That last point is subtle but perhaps it warrants more attention.

If the RBA had paused today and the Fed hikes tomorrow, it would result in the widest spread between Australia and US interest rates ever in favour of the latter. The prospect of that could lead to an even weaker aussie, which would not help with the inflation battle, and make that a tougher job for the RBA.

AUD/USD remains little changed amid the above remarks, still holding at 1% gains around 0.6695 currently.

This article was written by Justin Low at www.forexlive.com.

Bitcoin fell
all day yesterday, losing around 6% to $27.6K, raising the question of whether
we are seeing the start of a prolonged decline.

Bitcoin
closed below its 50-day moving average on Monday. The price stays below that
curve and is stuck at $28.0K after rising 1.3% to today. If it
can’t quickly surpass it again, Bitcoin’s fall below $27K will pave the way for
a move to $22K, where the 200-day passes, which became a turning point in
March.

Twitter
analyst Bluntz, who predicted a bear market bottom for BTC in 2018, expects Bitcoin
to fall to $25K. In his view, the first cryptocurrency is unlikely to break
$30,000 soon. BTC has completed a 5-wave and is now in a corrective A-B-C
formation.

News background

Cryptocurrencies
will outperform other asset classes amid the continued devaluation of fiat
currencies and the ongoing banking crisis, Real Vision CEO Raul Pal said
following the bankruptcy of First Republic Bank (FRB).

Peter
Brandt, tech analyst and head of Factor LLC, believes Bitcoin will soon
overtake all other cryptocurrencies and „bury all the imposters“. He
pointed to the chart of the BTC dominance index, which he believes is poised for
a breakout after two years of consolidation.

According to
Santiment’s research, crypto asset prices in April were „very broadly
dispersed“ and barely correlated with each other.

This article was written by FxPro’s Senior Market Analyst Alex
Kuptsikevich.

This article was written by FxPro FXPro at www.forexlive.com.

In part, this looks to be a bit more of a dollar move as the greenback is also holding decent gains now against the pound, franc and loonie as well.

However, there might also be a little something to it with the Eurozone CPI data earlier – which showed slightly softer core prices. Bond yields have unsurprisingly fallen back after the data release. But the fact that it doesn’t give the euro a reason to rally i.e. no panic for a 50 bps rate hike is reason enough for traders not to pile on the misery for the dollar.

In the past month or so, there is that slight divergence in policy hawkishness between the ECB and Fed. And that has provided a tailwind for the euro to rally against the dollar, especially as traders question the Fed’s appetite in the aftermath of the banking turmoil.

As such, the Eurozone CPI data today is perhaps a welcome development for EUR/USD sellers when you take the above into consideration.

In the bigger picture though, EUR/USD has been struggling to hold a firm break above 1.1000 with weekly resistance still firmly planted at the 2 February high of 1.1033.

Buyers will need to break above that going into the weekly close to really convince of the next upside leg for the pair. And if the ECB is likely to stick with a 25 bps rate hike given the data from today, then the euro would have to rely on some sprinkles of Fed dovishness to secure a breakout move.

This article was written by Justin Low at www.forexlive.com.

Following the success of last year’s event, iFX EXPO is returning to Bangkok for the second edition of the largest financial B2B expo in the world. Anticipation is building, as Thailand gears up to welcome thought leaders and industry influencers from across the online trading, financial services, and fintech sectors.

iFX EXPO Asia 2023 is taking place from June 20 to 22, 2023 at Centara Grand & Bangkok Convention Centre at CentralWorld, a five-star complex situated in the heart of the Thai capital’s business district. This year’s event is set to be bigger and better than ever before, featuring 20% more exhibitors than at the hugely successful 2022 expo.

The demand for the show is record-high, with 90% of booths already sold for the event, which is being organised by Ultimate Fintech, a company with a proven track record of planning world-leading expos, organising more than 20 successful expos over the past decade.

What to Expect

iFX EXPO Asia is a multi-day networking event, featuring unrivalled opportunities to connect with C-level executives from the most prominent international companies, with insightful talks from leading industry experts.

The event is expected to bring together a diverse range of stakeholders, including technology and service providers, digital assets, blockchain, retail and institutional brokers, payment providers, banks and liquidity providers, affiliates and IBs, as well as regulators and compliance officers. Such a varied demographic of exhibitors and attendees offers up the perfect opportunity for collaboration, networking, and fruitful discussion.

Who is Participating?

Some of the biggest companies have already confirmed their participation, with various financial firms on board as Exhibitors and Sponsors. Heading the list of sponsors this year is leading financial technology firm OpixTech, which has been announced as the Elite Sponsor of the expo, while UEZ Markets will be the Regional Sponsor.

Meanwhile, ZuluTrade and Equiti Capital are confirmed as Diamond Sponsors, with more companies joining the growing list of official sponsors of the event. Among the prominent companies signed up as Exhibitors are MetaQuotes, Solitics, Trading Central, cTrader, Pepperstone, STICPAY – with hundreds more also having reserved their spot.

On the Agenda

The expo gets underway with a Welcome Party, giving attendees the chance to meet before the exhibition begins the next day. The expo days serve as an excellent space for brands to showcase their innovative solutions, key insights, and predictions for the finance sector. Moreover, the event organisers have arranged a special Night Party, which presents an exciting and informal networking opportunity, whilst signing off the expo in style.

During the event, attendees can enjoy access to insightful talks at the Speaker Hall and Idea Hub by top industry speakers, and benefit from a host of meeting spots to mingle with like-minded professionals. There will also be a number of hot topics discussed through panel discussions with the experts from Revolut, Exness and Alibaba, alongside talks from industry pioneers, with notable speakers including:

· Sagar Desai: Senior Associate for Institutional Sales, Trading, and Prime at Coinbase

· Abhinav Singh Suryavanshi: Head of Engineering APAC at Revolut

· Tamas Szabo: CEO at Pepperstone

· Sandeep Raj: SVP, Growth at Alibaba

· John Murillo: Chief Dealing Officer at B2Broker

· Tanapat Kamsaiin: Country Business Development Manager at Exness

· Iskandar Najjar: CEO at Equiti Capital

· Benjamin Chang: CEO at Swissquote Asia

· And many more!

Check out the full list of talks, including the Speaker Hall and Idea Hub schedules, here.

How to Take Part

Booths and sponsorship slots are filling up fast, with 90% of the expo floor already sold out. Brands that wish to maximise their exposure at the event should email the Ultimate Fintech sales team as soon as possible. If you are interested in attending, you can register via the event website now.

There are only a few sponsorships left, such as the Welcome Party package. Sponsorships give brands the chance to make a memorable impression on attendees, with each package offering guaranteed visibility for the sponsor brand, both online and at the venue itself – from the expo’s social media and website to branding at key spots at the exhibition.

To enquire about Sponsorships and Exhibiting, please reach out to sales@ifxexpo.com.

Claim your Free Pass!

There is still time to secure a place at the expo! Registration is open and attendees can register and get their free pass, which includes:

· Access to the expo hall

· iFX EXPO Networking App accessibility

· Entry to the Speaker Hall and Idea Hub

· Admission to Sponsored F&B Areas

· Entry to the Business Lounges

· Access to the iFX EXPO Parties

Register now and get your free pass!

Will you be attending in Bangkok?

Don’t delay! Secure your accommodation now and take advantage of a special rate, exclusively available to iFX EXPO delegates. To find out more, click here.

This article was written by ForexLive at www.forexlive.com.

• USD/JPY brushes against key technical level at seven-week highs
• FDIC accepts JP Morgan bid for First Republic Bank
• What have markets priced in for the key central bank decisions this week?
• Japan April consumer confidence index 35.4 vs 33.9 prior

Markets:

• AUD leads, JPY lags on the day
• European markets closed; S&P 500 futures down 0.1%
• US 10-year yields up 3 bps to 3.481%
• Gold down 0.1% to $1,988.20
• WTI crude down 2.2% to $75.09
• Bitcoin down 2.6% to $28,578

It was a quiet session for the most part with European markets out for the long weekend amid the Labour Day holiday.

The dollar was steady throughout, with sentiment helped slightly by the news that JP Morgan is set to take over First Republic Bank. That could lead to some follow through moves later in US trading, so just be mindful of that.

The yen is the laggard as it continues to deepen losses from last week, with USD/JPY touching its 200-day moving average just below the 137.00 mark.

Besides that, things were largely slow-moving as market players are waiting to get the week started in Wall Street. The focus in the days ahead will center around key central bank policy decisions and that will set the tone for what to expect in May trading.

This article was written by Justin Low at www.forexlive.com.

• RBA: 90% probability of no change, 10% probability of 25 bps rate hike (OIS)
• Fed: 92% probability of 25 bps rate hike, 8% probability of no change (Fed funds futures)
• ECB: 81% probability of 25 bps rate hike, 19% probability of 50 bps rate hike (€STR)

Among the three, it is only the ECB pricing that might shift around a little ahead of the Thursday decision. That will be dependent on what we see from the Eurozone CPI data tomorrow, as pointed out earlier here.

The RBA meanwhile will be a rather straightforward one, as they are widely expected to keep the cash rate unchanged. And they are also likely to deliver a similar communique to what we already saw last month.

As for the Fed, that is where things start to get interesting for broader markets. While a 25 bps rate hike is almost certainly a done deal, what comes next is still up in the air for the most part. Will the Fed stick with a higher for longer approach and narrative? Or will they acknowledge that the time is now here to call for a pause?

Whatever the case is, it will definitely have an impact on the Fed funds futures curve.

As things stand, traders are pricing in two rate cuts by year-end and that the Fed will pause after this week’s rate hike.

We shall see whether or not policymakers agree with that view and how Powell will communicate that when the time comes on Wednesday.

This article was written by Justin Low at www.forexlive.com.