· The U.S. dollar edged down on Friday in Asia despite better-than-expected labour and inflation data released overnight.
The U.S. dollar index that tracks the greenback against a basket of other currencies was down 0.2% to 96.597.
· "Many market players had taken a bearish view on the dollar after the U.S. CPI numbers released earlier in the week, but they were forced to abruptly cover short positions as Thursday's data proved to be strong," said Takuya Kanda, general manager at Gaitame.Com Research Institute, in a Reuters report.
"The rise thus lacked conviction and it remains to be seen if the dollar can sustain its bounce. The prospect of a rate cut by the Fed may have diminished in light of the data, but economic views are not yet strong enough to support rate hike expectations," Kanda said.
· Meanwhile, the GBP/USD pair edged up 0.2% to 1.3072 after the European Union agreed to push back the U.K.’s departure date as far as Oct. 31.
· USD/JPY rose from 111.10 to 111.70 overnight and clocked fresh monthly tops at 111.82 last hour, as the Asian traders cheered upbeat US PPI and jobs data. But further upside appears to lack momentum amid mixed Asian equities and negative Treasury yields.
Dollar's momentum extends early Asia, with the USD/JPY pair trading near daily highs around 111.60, and technically bullish, as, in the 4 hours chart, the price is firmly advancing above its moving averages, while technical indicators extended their recoveries well into positive ground. The immediate resistance is this month high at 111.81, followed by the yearly top at 112.13. Large stops are suspected above this last, and if those get triggered, the pair could extend its advance up to the 112.40/50 price zone.
Support levels: 111.35 111.00 110.75
Resistance levels: 111.80 112.15 112.50
· The Daily chart (bearish) in EUR/USD shows that the price has been supported on the 61.8% Fibo since Oct 2018 with rallies capped at the 50% Fibo of the same range (with the confluence of the 200-D SMA - a tough nut to crack) .
The EUR/USD pair keeps trading between Fibonacci levels, unable to advance beyond the 38.2% retracement of the 1.1447/1.1183 decline at around 1.1285, but holding above 1.1245, the 23.6% retracement of the same decline, having spent most of the week inside this range. The short-term picture shows that the bearish potential has increased, as, in the 4 hours chart, the pair is now below all of its moving averages, while technical indicators entered negative ground, the Momentum extending its downward slope and the RSI currently at 45. The pair could re-test the yearly low at 1.1175 if 1.1245 gives up.
Support levels: 1.1245 1.1200 1.1175
Resistance levels: 1.1285 1.1315 1.1305
· With global growth already slowing down, starting a trade war now between the U.S. and the European Union would be both a political and economic mistake, according to French Finance Minister Bruno Le Maire.
In two Twitter posts this week, U.S. President Donald Trump hit out at the EU, even calling the bloc “a brutal trading partner.”
· The U.S. Federal Reserve has switched from a stance that was “too hawkish” at the end of last year to “too dovish” presently, according to Mohamed El-Erian, Allianz’s chief economic advisor.
While such a drastic swing is not expected to hit the U.S. economy in a big way, it has contributed to greater volatility in financial markets globally, he told CNBC’s “Capital Connection” on Friday. El-Erian is widely followed for his views on the world economy and markets.
· China’s exports for the month of March came in much higher than expected, while its imports came in much lower than expected, according to customs data released on Friday.
Dollar-denominated exports rose 14.2 percent for March from a year ago, topping expectations of a 7.3 percent rise from a year ago, according to a Reuters poll.
But dollar-denominated imports were down 7.6 percent in March from a year ago, falling short of expectations of a 1.3 percent decline from a year ago.
All told, that gave China a March trade surplus of $32.64 billion, according to Reuters and Dow Jones calculations. Dow Jones said the surplus was only expected to have come in at $6 billion and Reuters had expectations at $7.05 billion.
Following the release of the data, the offshore Chinese yuan dropped to 6.7225 against the dollar from an earlier session high of 6.7303, according to Reuters.
· Oil prices edged up on Friday, lifted by ongoing supply cuts led by producer club OPEC and by U.S. sanctions on petroleum exporters Iran and Venezuela.
Despite strong price increases this year, there are concerns that an economic slowdown could soon dent fuel consumption.
International Brent crude oil futures were at $71.03 per barrel at 0653 GMT, up 20 cents, or 0.2 percent, from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at $63.82 per barrel, up 24 cents, or 0.4 percent, from their previous settlement.
· CRUDE OIL TECHNICAL ANALYSIS
Crude oil prices pulled back from support-turned-resistance in the 63.59-64.88 area, but the near-term uptrend set from late December is still in place. A break below 60.39 would invalidate the rise, exposing the 57.24-88 area next. Alternatively, a push above resistance would be immediately met with another barrier in the 66.09-67.03infection zone. Beyond that, the focus turns to the $70/bbl figure.
Reference: CNBC, Reuters, Investing.com
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