There was little action across the forex board this Monday

EUR/USD

There was little action across the forex board this Monday, yet the dollar edged mostly lower against its major rivals, weighed by a modest decline in worldwide stocks. A sparse macroeconomic calendar and some soft readings in the US housing sector during the American afternoon saw the greenback easing further ahead of Wall Street's close.  

In the EU Germany released its IFO survey, which missed market's expectations in April, but showed that sentiment remained stable, as the assessment of the current situation down to 113.2 from 113.6, and expectations up to 100.4, above March 100.0, but a tad below expectations of 100.8. In the US, New Home sales decreased 1.5% in March to a 511,000 annualized pace, missing the median forecast for a gain to 520,000. 

Markets attention is centered in the upcoming FED and BOJ's meetings, both expected to shed some light over upcoming economic policies. And while the first is expected to take one step towards a new rate hike, the second is largely expected to maintain the easing path. The EUR/USD pair fell down to 1.1215 early Asia, but was unable to extend its decline below a major static support the 38.2% retracement of the latest daily advance around 1.1220, and dedicated the day to recover some ground, stretching up to 1.1277. The EUR may advance further, up to the 1.1310 region, the 23.6% retracement of the mentioned rally, given that in the 4 hours chart, the price is aiming to advance above a still bearish 20 SMA, whilst the technical indicators maintain bullish slopes within negative territory, but remain below their mid-lines. 

Support levels: 1.1250 1.1220 1.1160 

Resistance levels: 1.1315 1.1340 1.1380

USD/JPY

The USD/JPY pair advanced up to 111.88, but shed over 100 pips early US session, weighed by poor US data and market's talks suggesting the BOJ may stay pat this month, and consider more easing  in their June meeting. Yet the pair recovered above the 111.00 level ahead of the US close, closing the day in the red anyway. Not much should be expected for the pair during the upcoming sessions, as the US Federal Reserve will have its economic policy meeting late Wednesday, whilst the BOJ will do the same early Thursday.  Anyway and from a technical point of view, the pair presents a persistent bullish tone, as in the 4 hours chart, the technical indicators have turned sharply higher within positive territory, after correcting previous overbought readings. Furthermore, the recovery above 111.00, in spite of stocks' declines, suggests that JPY bulls have taken a step aside, whilst sellers are gathering pace. The downward potential is now seen limited, as long as the price manages to hold above 110.65, a strong static support zone. 

Support levels: 110.65 110.30 109.80

Resistance levels: 111.40 111.90 112.30

GBP/USD

The British Pound outperformed this Monday, rallying up to 1.4518 against the greenback, its highest since early February, with no clear catalyst behind Sterling's strength. Data coming from the UK showed that manufacturing activity fell by less than expected in March, as the CBI Industrial Trends survey come in at -11 during the current month against -15 forecasted and up from March’s -14. Also, helping the Pound were some anti-Brexit rhetoric from UK authorities and new polls showing that the support for the Brexit plunged to 29%  from previous 34%. The GBP/USD retreated from the mentioned high, but holds around the 1.4500 figure, maintaining a positive technical tone, as in the 4 hours chart, the price is well above a bullish 20 SMA, whilst the Momentum indicator continues heading north well above its 100 level and the RSI indicator consolidates around 70. Nevertheless a strong upward acceleration through the 1.4520 level is required to confirm additional gains for this Tuesday that can extend up to the 1.4600 region.  

Support levels: 1.4465 1.4420 1.4370   

Resistance levels: 1.4520 1.4555 1.4600

AUD/USD

The AUD/USD pair is barely changed from its Friday's close, with a holiday in Australia and New Zealand keeping local investors quiet at the beginning of the week, and soft commodities' prices limiting the advance of the antipodean currency later in the day, in spite of broad dollar's weakness. With no data scheduled for the upcoming session, the Aussie will likely keep on trading accordingly to oil and gold's prices, which means the risk has turned towards the downside, at least in the short term. Holding a few pips above the daily low of 0.7690, the 4 hours chart shows that the 20 SMA heads sharply lower around 0.7750, now the immediate resistance, whilst the Momentum indicator consolidates below its 100 level and the RSI indicator anticipates some additional declines by heading lower around 41. A downward acceleration below the mentioned support can see the pair approaching the 0.7600/20 region, where long-term speculative buying interest may attempt to buy the pair back. 

Support levels: 0.7690 0.7655 0.7620  

Resistance levels: 0.7750 0.7790 0.7835 

Dow Jones

US stocks finished lower on Monday, although away from session lows, following a round of unimpressive earnings reports and as investors await the conclusion of Fed’s policy meeting on Wednesday. The Dow Jones Industrial Average fell 26 points, or 0.15%, to 17,977.24. The S&P 500 dropped 3 points, or 0.18%, to 2,087.79. Finally, the Nasdaq Composite lost 10 points, or 0.21%, to 4,895.79. The DJIA fell as low as 17,850 before trimming most of its daily losses, and the daily chart shows that the intraday decline stalled above a still bullish 20 SMA, currently around 17,818, whilst the technical indicators consolidate within positive territory, lacking clear directional strength. In the 4 hours chart, the late recovery has helped the technical indicators to bounce sharply from oversold levels, but have halted the recovery around their mid-lines, whilst the 20 SMA maintains a tepid bearish slope, capping the upside in the short term at 18,008. 

Support levels: 17,919 17,826 17,748

Resistance levels: 18,008 18,094 18,165

FTSE 100

The FTSE 100 declined for a second day in-row, pulling back further from the yearly high set last week. The index lost 49 points, and closed the day at 6,260.92, weighed by a slump in mining-related shares, Anglo American fell by 7.3%, Rio Tinto lost 4.16%, while BHP Billiton shed 5.8%. Base metal suffered on news  that Chinese total debt to a record 237% of its GDP during the Q1, raising the risk of a financial crisis or a prolonged slowdown in growth. Anyway, the Footsie daily chart shows that the index held above its moving averages, with a bullish 20 SMA offering an immediate support at 6,254, and the Momentum indicator heading slightly higher within positive territory, whilst the RSI heads south around 52, all of which suggests the index may extend lower only on a downward acceleration below the mentioned support. In the 4 hours chart, the index is well below a bearish 20 SMA whilst the technical indicator hover near oversold territory, also risking additional slides during the upcoming sessions. 

Support levels: 6,255 6,206 6,152

Resistance levels: 6,331 6,368 6,440 

DAX

European stocks ended lower as renewed concerns over Chinese economy dragged basic metals lower, resulting in the mining sector edging sharply lower. The German DAX lost 78 points and closed the day at 10,294.35, also weighed by the local IFO survey, showing business sentiment softened in April, down to 106.60 against the 107.0 expected. Auto-makers also suffered as the emission scandal resurged on news Daimler was reviewing its certificates in the US, with Volkswagen down 1.9%, and Daimler closing 0.7% lower this Monday. The daily chart for the benchmark, however, continues favoring the upside, as the index has quickly recovered from a slide below its 200 DMA and closed the day above it, whilst the Momentum indicator maintains its bullish slope within overbought territory, and the RSI indicator hovers around 62. In the 4 hours chart, the index is currently below a bullish 20 SMA, while the technical indicators have turned flat within neutral territory, increasing the risk of a downward extension,  on a break below 10,226, this Monday's low.

Support levels: 10,278 10,226 10,151

Resistance levels: 10,430 10,491 10,569 

Nikkei

Asian share markets closed mostly lower, with the Nikkei 225 down 132 points or 0.76% to end at 17,439.30. Investors preferred to take some profits out ahead of the upcoming FED and BOJ's meetings later this week, whilst mixed earnings reports fueled uncertainty. Among the worst performers was Sony, down 6% after the company reported it would delay its earnings forecast for the 2016 fiscal year in order to assess the impact of recent earthquakes on its profits, whilst exporter-related shares edged mostly higher, amid a weaker JPY. From a technical point of view, the daily chart shows that the Momentum indicator maintains its upward slope, despite being in extreme overbought territory, although the RSI indicator is partially retreating, also from overbought levels. The 100 DMA stands at 17,183, a strong dynamic support in the case of further declines. In the 4 hours chart, the index is struggling around a bullish 20 SMA, whilst the technical indicators have lost downward strength within positive territory, after reaching their mid-lines, where they turned flat, rather reflecting the absence of directional momentum at the time being than supporting a certain directional move. 

Support levels: 17,332 17,212 17,161

Resistance levels: 17,507 17,587 17,692

Gold

Spot gold posted a modest advance this Monday, having extended up to $1,242.23 a troy ounce before settling around 1,237.00, as broad dollar's weakness and stocks soft tone supported demand for the safe-haven asset. Trading, however, was lackluster ahead of the FED's meeting this Wednesday, as the commodity has been long dependent of the US economic policies. Set to consolidate further, the daily chart presents quite a neutral stance, as the technical indicators hover around their mid-lines, whilst the price is stuck around a horizontal 20 SMA. Also, the price remains above, but getting closer, to a daily ascendant trend line coming from February 10th low at 1,181.46, today around 1,222.30, the level to break to confirm a steeper decline. In the 4 hours chart, the price failed to advance above its moving averages, with the 20 SMA maintaining a strong bearish slope and offering a dynamic resistance around 1,242.80, whilst the technical indicators have recovered partially within bearish territory, but turned flat, lacking directional strength.  

Support levels: 1,222.30 1,214.80 1,206.90

Resistance levels: 1,242.80 1,251.70 1,262.60

WTI Crude Oil

Following a choppy session, crude oil futures finally settled lower on Monday, pulling back from 5-month highs struck last week. West Texas Intermediate oil settled at $42.64 a barrel on the Nymex, down $1.09, or 2.5% on the day. With a modest decline, WTI halted a four-day winning streak. Investors assessed the potential effects of Saudi Arabia’s economic reform plan announced on Monday, which aims to reduce its dependence on oil, whilst Genscape, a US private data forecaster reported an over 1.5M barrels increase in stockpiles at the Cushing, Oklahoma delivery point in the week ended on April 22nd. The commodity trades near its daily low of $42.57 a barrel, and the daily chart shows that the technical indicators have turned sharply lower from overbought levels, holding so far above their mid-lies, but in line with further declines, particularly on a break below the 42.00 figure. Shorter term, the 4 hours chart supports some additional declines, as indicators are biased slightly lower within negative territory, although the 100 and 200 SMAs continue grinding higher well below the current level, with the shortest now around 40.70.

Support levels: 42.10 41.40 40.70

Resistance levels: 43.10 43.80 44.50