With little on the agenda, markets are seeing a more optimistic tone so far today and that is also weighing on the dollar. It might be a bit of a late acceptance to China’s strong Q1 GDP data earlier but stocks won’t be complaining. Here’s a snapshot of things at the moment:

• S&P 500 futures +0.4%
• Nasdaq futures +0.6%
• Dow futures +0.3%
• Eurostoxx +0.6%
• Germany DAX +0.5%
• France CAC 40 +0.5%
• UK FTSE 0.2%

In Europe, the optimism continues to flow and the DAX is in the hunt for its fourth weekly gain in five weeks, trading up to its highest levels so far this year. Eyes will be on the November 2021 high at 16,290 next.

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

• Higher yields provide some comfort to the dollar for now
• How has Fed pricing changed after the events on Friday?
• ECB’s Kazaks: May option is 25 bps or 50 bps move
• SNB total sight deposits w.e. 14 April CHF 544.1 bn vs CHF 532.2 bn prior

Markets:

• USD leads, EUR lags on the day
• European equities mixed; S&P 500 futures up 0.1%
• US 10-year yields up 2.1 bps to 3.543%
• Gold up 0.2% to $2,007.91
• WTI crude down 0.5% to $82.12
• Bitcoin down 2.2% to $29,802

There aren’t any major headlines to start the new week, with there being a lack of any key economic releases in Europe today as well.

As such, markets are left to their own devices with the dollar holding steadier for the most part after the Friday rebound. There was a slight bid at the start of the session but overall, the greenback is sitting lightly changed at the moment.

EUR/USD is keeping below the 1.1000 mark around 1.0970-80 levels while GBP/USD fell back below 1.2400 to 1.2375 before holding around 1.2410 at the moment.

USD/JPY gradually nudged higher back towards 134.00 as bond yields held higher, with Fed funds futures seeing a less dovish path to the rates curve as compared to before the events on Friday.

Elsewhere, European equities opened with some cautious optimism but are now sitting more mixed with some marginal losses on the board. That’s not indicative of any firm narrative as we get the week underway.

With the data set this week not being as crucial as last week, Fed speakers may be what markets will look to for clues on how to proceed next – all before the FOMC blackout period that will begin on 22 April.

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

On the daily chart below for the Nasdaq, we can
see that the price action is tentative trading into the key resistance at 12274. The sellers are likely
waiting there, ready to defend the level with little risk above and big reward
in case the market resumes the main bearish trend.

The moving
averages are acting as support for the buyers at the moment and keep the bullish
trend intact. The breakout of the bullish
flag might ultimately lead to an extension to the 13186 resistance but the
buyers need to break with conviction above the 12274 level first.

Nasdaq technical analysis

On the 4 hour chart below, we can
see that the moving averages have converged as the price action has become
rangebound. Last Friday the buyers haven’t got any help from the economic data
as retail
sales missed across the board, Fed’s
Waller delivered hawkish comments and the 1
year inflation expectations in the University of Michigan survey showed a big
jump to the upside.

On the 1 hour chart below, we can
see more closely the current range created just below the key resistance. In
such instances, it’s best to just stay out and wait for the price to break on
either side supported by a fundamental catalyst and go with the flow. But one
can also “play the range” selling at resistance and buying at support. The next
economic data to watch are the US Jobless
Claims on Thursday and US PMIs on Friday.

1

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

That seems to be on the cards, with Deutsche seeing headline annual inflation slowing to 9.73% in March while core annual inflation is estimated to slip to 5.85%. For some context, the economist estimates for both are seen at 9.8% and 6.0% respectively.

That said, the firm says that the risks to their forecasts this week are tilted to the upside. They mention that there is still a big question mark on the persistence of services inflation and that is likely to remain resilient in the months ahead.

However, they do expect the price momentum for core goods to soften with supply chains normalising further and food inflation also likely to slow from the summer onwards. The latter though is still anticipated to remain more robust than normal for much of the year.

Some commentary on the big picture outlook:

„Overall, we remain optimistic that prices will slow this year with CPI getting back
to target around Q3-24. Risks to our forecast remain to the downside, particularly
on headline inflation. But we do see some upside risks to core inflation. Corporate
pricing power remains strong. Inflation expectations remain unanchored, relative
to the BoE’s target. And wage gains remain inconsistent with the Bank’s 2%
mandate. This is a key reason why we see the Bank of England’s terminal rate
landing zone as 4.25% to 4.75% — explicitly pointing to upside risks to our Bank
Rate projections. We will be looking more closely at corporate pricing power in
forthcoming pieces, which will be key in assessing the monetary policy outlook.“

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

On the daily chart below for the S&P 500, we can
see that the price is again struggling hard at the key 4175 resistance. This level has been holding
since September 2022 and as soon as the price gets there, it gets rejected. The
sellers are likely to lean on this level again with a low risk in case the
price breaks above and a huge reward in case the market turns, and we get
another big bearish move.

Last Friday the buyers haven’t
even got any help from the economic data as retail
sales missed across the board and the 1
year inflation expectations in the University of Michigan survey showed a big
jump to the upside.

S&P 500 Technical Analysis

In the 4
hour chart below, we can see that the price has been diverging with the MACD rallying into the key
resistance. This should be a sign of a weakening momentum and it generally
leads to a pullback or reversal. The market may correct towards the trendline where the buyers are likely to
lean onto. This is also where they should find support from the daily red long
period moving
average.

In the 1
hour chart below, we can see how the spike above the key resistance was
immediately followed by a big reversal. There are strong sellers here that keep
defending this level. The first target for the sellers should be the support
zone at 4100.

The
buyers may need a bullish fundamental catalyst to gather enough momentum to
break above the resistance and start a rally towards the next resistance at
4300. Unfortunately, there’s no tier one economic data release until Thursday and
Friday when we will get the US Jobless Claims and the US PMIs.

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

Higher Treasury yields and less dovish Fed pricing has certainly helped with the pair’s recovery since Friday, with price now climbing back above 134.00 to its highest levels since 15 March last month.

Of note, the pair is hoping to crack through resistance from the 50.0 Fib retracement level of the swing lower in March, seen at 133.77, after the break above the 100-day moving average (red line) again at the end of last week.

That tees up a potential push towards 135.00 next, before buyers might reassess for any move back towards the 200-day moving average (blue line) – now seen at 137.12. The latter is a key level which helped to stop gains last month, all before the banking turmoil engulfed the market landscape.

All eyes will stay on the bond market though and for now, it doesn’t look like 10-year yields in the US are going to threaten a break lower under the key threshold near 3.30%. The banking crisis has ebbed and if traders start to come around to the idea that the Fed is indeed going to hold rates higher for longer, that’s an upside boon for USD/JPY.

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

In this article, we will explore wheat futures technical analysis and provide a price forecast based on current market trends. We’ll also discuss potential trading strategies and risk management for those interested in wheat-related assets.

Key Points for the wheat futures technical analysis video

• Wheat futures breakout of an ascending wedge on the 4-hour time frame
• Next probable target: 700 round number
• Potential retest and entry points for investors and traders
• Longer-term price movements and possible targets

Wheat Futures Technical Analysis: Breakout of Ascending Wedge

A recent technical analysis on the 4-hour time frame shows that wheat futures (ZW) have broken out of an ascending wedge. This bullish pattern suggests that the next probable target for ZW could be the 700 round number.

Possible Retest and Entry Points

Investors and traders may want to time their entries with a possible retest of the descending wedge, while being aware that it might not happen and they could miss their entry points. A balanced approach could be to scale into the trade, ensuring risk management while taking advantage of potential price movements.

Always trade at your own risk and consult ForexLive.com for additional perspectives on wheat futures technical analysis and price forecasts.

Wheat Futures on the Weekly Time Frame: Building a Base

Looking at the weekly time frame, wheat futures have experienced a strong downtrend from their all-time high of 1430.6, currently sitting about 52.3% below that level. However, the market may be starting to build a base and find support in an area that has seen consolidation and price reactions in the past. This could indicate an interesting area to bet on wheat building a base and potentially moving higher.

Potential Longer-Term Targets: 800 Round Number

If the base-building scenario plays out, traders and investors may consider aiming for a longer-term target of the 800 round number, close to previous highs. For those trading long, it could be worth leaving a portion of the position (e.g., 20% or more) to capitalize on a possible move towards 800.

Different instruments, such as call options, CFD contracts, or future contracts, can be used to play this potential longer-term move in wheat futures.

In summary, wheat futures technical analysis points to a breakout from an ascending wedge, with the next probable target being the 700 round number. Investors and traders should keep an eye on possible retest levels and entry points, as well as longer-term targets around the 800 round number. As always, trade at your own risk and visit ForexLive.com for additional views and insights on wheat futures price forecasts.

This article was written by Itai Levitan at www.forexlive.com.

MUFG Research maintains a short USD/JPY exposure (spot ref: 134:70) in its TOTW portfolio with a target at 129.00, and a stop at 138.50.

„We are maintaining a short USD/JPY trade idea. While there are risks of further increases in US short-term yields, we doubt USD/JPY will gain to the same extent of traction and see risks of the move higher petering out,“ MUFG notes.

MUFG also added a fresh short USD/CAD position (spot ref: 1.3375), with a target at 1.2950, and a stop at 1.3650.

„We’re adding a short USD/CAD trade idea based on recent developments we view as CAD supportive,“ MUFG notes.

For bank trade ideas, check out eFX Plus. For a limited time, get a 7 day free trial, basic for $79 per month and premium at $109 per month. Get it here.

This article was written by Adam Button at www.forexlive.com.

• Deposit outflows from the banking system have stabilized. Things have been calm but monitoring carefully
• Bank lending standards have tightened somewhat , may be more tightening to come
• Not seeing anything dramatic enough to significantly change outlook for moderate growth, strong labor market and easing inflation
• Over time, there is risk that financial system sanctions linked to dollar could ‚undermine the hegemony‘ of the US dollar
• Sanctions do create desire by China, Russia and Iran to find an alternative to dollar

I find it interesting that Yellen said outflows from the banking ’system‘ have failed rather than saying outflows from small banks have stabilized. Jim Bianco highlights that yesterday mega-cap US banks jumped and small cap banks fell 2.1% in a sign that money is flowing in one direction without leaving the system.

This article was written by Adam Button at www.forexlive.com.

In this video, I look at the recent S&P 500 technical analysis and provide a price forecast based on the findings (spoiler: IMHO, we are headed to 4200). A surprising selloff occurred following a rally on Friday, and we’ll explore the reasons behind it while considering possible future price movements.

Key Points within the S&P 500 e-mini futures analysis video

• Yellow, green, and purple channels in S&P 500 e-mini futures technical analysis
• Recent sell-off triggered at the top of the green channel
• Upcoming resistance at 4178 and possible breakout scenarios

S&P 500 Technical Analysis: Channels and Touch Points

The S&P 500 e-mini futures technical analysis on the two-hour time frame shows three channels: yellow, green, and purple. The yellow channel starts with the first touch point and pivot low points on the 13th of March, featuring touch points at the bottom and others on the 22nd of March, April 3rd, and April 4th.

On Friday, the market rallied to create a second touch point with the pivot point on April 4th, leading to the formation of the green channel. The purple channel will also be followed in this analysis.

Sell-Off Triggered at the Top of the Green Channel

On the one-hour time frame, a sell-off was triggered at the top of the green channel after Friday’s rally. The trend line stopped the sell-off, and a new channel was formed with the bottom band of this trend line. Three touch points on the top were observed on the 12th and 13th of April.

Why Multiple Channels Matter

These channels and junctions are important because market participants, including trading algorithms and professional traders, are likely monitoring them. The dotted line represents the midpoint of the yellow channel, and the market is approaching 4178, which is also the top of the high on April 12th. This indicates potential sellers in the market.

Potential Future Price Movements I’m looking at

There are multiple possible scenarios for future price movements. One possibility is a drop, followed by a breakout of the channel to reach the top of the purple channel, close to the 4200 round number. Alternatively, the market may rally up to the purple top band and then follow a different path to reach the 4200 round number.

In either scenario, profit-takers may choose to take partial or full profits from previously profitable long positions. As always, trade at your own risk and visti ForexLive.com technical analysis for additional perspectives on S&P 500 technical analysis and price forecasts.

This article was written by Itai Levitan at www.forexlive.com.