Talking Points:
Euro May Lead Amid Correction, Offering a Short Trade Setup
Japanese Yen Soft in Asia as Nikkei 225 Futures Gap Upward
New Zealand Dollar Rebounds After Last Week’s Blood-Letting
The economic calendar is quiet in European and US trading hours, offering little by way of market-moving event risk. That opens the door for corrective price action as investors digest last week’s late surge of activity that took the CVIX index of currency market volatility to an eight-day high.
The swift pickup in activity followed an unexpectedly dramatic ECB rate decision where central bank President Mario Draghi threatened possible intervention into the Euro exchange rate. Not surprisingly, the single currency came under broad-based pressure, and so may now lead the way upward amid a correction. We are looking for a selling opportunity.
The Japanese Yen narrowly underperformed in muted overnight trade as Nikkei 225 futures gapped higher to start the trading week, undermining demand for the safe-haven currency. The New Zealand Dollar corrected upward having completed the largest five-day drop in three weeks on Friday.
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Asia Session
GMT
CCY
EVENT
ACT
EXP
PREV
23:50
JPY
Current Account Total (¥) (MAR)
116.4B
347.7B
612.7B
23:50
JPY
Adjusted Current Account Total (¥) (MAR)
782.9B
-545.8B
-36.1B
23:50
JPY
Trade Balance – BOP Basis (¥) (MAR)
1133.6B
-1125.4B
-533.4B
23:50
JPY
Bank Lending incl Trusts (YoY) (APR)
2.1%
–
2.1%
23:50
JPY
Bank Lending Banks ex-Trust (APR)
2.2%
–
2.3%
1:30
AUD
Credit Card Purchases (MAR)
A$23.0B
–
A$21.4B
1:30
AUD
Credit Card Balances (MAR)
A$49.8B
–
A$50.2B
1:30
AUD
NAB Business Confidence (APR)
6
–
4
1:30
AUD
NAB Business Conditions (APR)
0
–
1
3:00
NZD
REINZ House Price Index (MoM) (APR)
0.1%
–
3.4%
3:00
NZD
REINZ House Sales (YoY) (APR)
-20.2%
–
-10.0%
4:30
JPY
Bankruptcies (YoY) (APR)
–
-12.37%
5:00
JPY
Eco Watchers Survey: Current (APR)
45.0
57.9
5:00
JPY
Eco Watchers Survey: Outlook (APR)
40.0
34.7
European Session
GMT
CCY
EVENT
EXP
PREV
IMPACT
7:15
CHF
Retail Sales (Real) (YoY) (MAR)
1.9%
1.0%
Low
8:30
GBP
Lloyds Employment Confidence (APR)
–
-2
Low
Critical Levels
CCY
Supp 3
Supp 2
Supp 1
Pivot Point
Res 1
Res 2
Res 3
EUR/USD
1.3583
1.3683
1.3721
1.3783
1.3821
1.3883
1.3983
GBP/USD
1.6662
1.6768
1.6809
1.6874
1.6915
1.6980
1.7086
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
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Source: Daily fx
