Powell says "more" likely needs to be done. ECB press conference begins.
Erik Bregar of Exchange Bank of Canada - InsideFutures.com - Thu Apr 30, 10:24AM CDT

ANALYSIS

USDCAD

Dollar/CAD is trading with a subdued tone just above the lower bound of its April price range (1.3850s) as traders await the main events of this morning. ECB President Christine Lagarde is expected to take center stage at 8:30amET and shell be under immense pressure to explain todays rather lackluster ECB statement following its 7:45amET policy meeting. The US will report its Jobless Claims figures for the week ending April 25 (+3.5M expected). Canada will release its February GDP data as well (+0.1% MoM expected).

The FX option market priced yesterday non-eventful FOMC meeting to a tee. The Fed kept interest rates and all its new asset purchase/loan programs in place as expected, and chairman Powell championed the central banks recent effort to help restore credit market functionality, however, we didnt think he sounded confident at all about the future. Powell talked about some very real risks that aremaking it difficult to predict when the economy can get back to normal and he conceded that MORE LIKELY NEEDS TO BE DONE IN RESPONSE TO CRISIS WHETHER BY FED OR CONGRESS. This headline was the only realtakeaway from the meeting in our opinion, and explains the modest extension of positive risk sentiment and USD selling that we saw following it.

USDCAD DAILY

USDCAD DAILY

USDCAD HOURLY

USDCAD HOURLY

JUNE CRUDE OIL DAILY

JUNE CRUDE OIL DAILY


EURUSD

The European Central Bank kept interest rates on hold this morning (as expected) and while it relaxed the terms on its TLTRO III program and created a new pandemic emergency longer-term refinancing operation (helpful), it didnt announce any increase to its 750blnEUR Pandemic Emergency Purchase Program or its 20blnEUR/month Asset Purchase Program (which was a bit disappointing).

Full press releasehere. LIVE LINK to Christine Lagardes press conferencehere.


EURUSD DAILY

EURUSD DAILY

EURUSD HOURLY

EURUSD HOURLY

BTP/BUND SPREAD DAILY

BTP/BUND SPREAD DAILY


GBPUSD

Sterling charged back above the 1.2500 resistance level in London trade this morning as continued talk of month end flows made the rounds. Many month-end models are still forecasting broad USD sales this April, and what we could also be seeing today is simply the conclusion/absence of those artificial month-end EURGBP buying flows that pressured the pound yesterday. The bearish head and shoulders pattern, that we talked about early yesterday as a potentially bearish technical development for the daily GBPUSD chart, never got confirmed by virtue of the market closing NY trade decisively back above 1.2440. All this, in our opinion, has helped sterling recover today, and then some.

We think a NY close above the 1.2500 mark today would be technically positive and signal the markets intention to re-challenge Aprils highs in the 1.2640s. The UK will report its final April Manufacturing PMI tomorrow, while the UK is on holiday for May Day, at 4:30amET. The consensus expectation for 32.8, versus the flash estimate of 32.9.

GBPUSD DAILY

GBPUSD DAILY

GBPUSD HOURLY

GBPUSD HOURLY

EURGBP DAILY

EURGBP DAILY

AUDUSD

The Australian dollar took a little knock lower last night following President Trumps comments about potential retaliation against China regarding their handling of the coronavirus. Moreherefrom Reuters.

Chart resistance (turned support) in the 0.6530s continues to hold however ahead of this mornings upcoming economic headlines. Over 2.7blnAUD of options will expire at the 0.6570 strike at 10amET this morning.

AUDUSD DAILY

AUDUSD DAILY

AUDUSD HOURLY

AUDUSD HOURLY

USDCNH DAILY

USDCNH DAILY


USDJPY

Dollar/yen is hanging in there this morning, despite widely reportedUSD selling elsewhere. We think the raft of topside option expiries on deck for 10amET today could be helping to stem the slide for now. Over 2.4blnUSD rolls off between the 106.60 and 107.00 strikes. We think any hope for a sustainable USDJPY bounce into next weeks Golden Week holidays hinges upon the market regaining the 106.60s on a closing basis.

USDJPY DAILY

USDJPY DAILY

USDJPY HOURLY

USDJPY HOURLY

US 10 YR YIELD DAILY

US 10 YR YIELD DAILY

Charts: Reuters Eikon

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