- Trade wars and geopolitical tensions are still on the arena. A trade war between the US and China were discussed during the IMF meeting this weekend. Members of the meeting assessed trade wars and mounting debt as threats to the global growth outlook.
At the same time, North Korea promised to suspend nuclear and missile tests and shut down a nuclear test site. However, Washington claimed that the US is not ready to lift sanctions until North Korea fully closes its nuclear programs.
- Stocks are falling because risk-off sentiments are prevailing in the market. Geopolitical and trade tensions do not let investors feel safe.
- The US dollar index is rising. The greenback is above 90.30. The dollar’s strengthening leads to a fall of other currencies. Let’s look how big the fall is.
- More dovish comments of the Bank of Japan Governor and the strengthening USD weight on the JPY’s rate. The USD/JPY pair is increasing. The pair has already reached the resistance at 107.88 achieving the highest level since the end of February. The next resistance lies at 108.12.
But if investors feel more pressure from geopolitical and trade tensions, the JPY will be able to recover. The support will lie at 107.60.
- Although data that were released today in the morning appeared to be mostly positive, the EUR/USD pair is falling further.
At the end of the previous week, the euro reached the lowest level in 2 weeks. Although the pair has not reached the Friday’s low, it is moving to it. The support lies at 1.2240.
- The pound is under the pressure. On April 18 the peers voted to keep the UK in the customs union with the EU. But as we know, the government is against it. At the same time, on weekends, talks that UK Prime Minister Theresa May might have to accept permanent membership of customs union appeared. So the situation around Brexit remains unstable putting pressure on the pound.
The pair tried to turn around after the last week’s fall. GBP/USD reached the pivot point at 1.4026, but could not break above it and remained in the downtrend area. The support is at 1.3960.
- The Canadian dollar is not supported by the Bank of Canada. This weekend, the BOC’s Governor Mr. Poloz declared that an increase of the inflation above 2% does not mean an immediate rate hike. Today Mr. Poloz will present a speech before the House of Commons Standing Committee on Finance (22:30 MT time). Let’s see whether his mood changes.
The USD/CAD pair is continuing its upward movement. The 50-day MA is a resistance for the pair. If it is able to break it, USD/CAD will move further to the next level at 1.2795.
- Bitcoin stays near $9,000. An analyst of a Danish bank, Saxo Bank predicts a fresh upside for the Bitcoin in the second quarter of 2018. Let’s see whether the cryptocurrency is able to break above the psychological level of $9,000 and move further.
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