Rupee Tumbles on Worries RBI’s Bond Plan May Add to Money Glut

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The Investment Bank Outlook 07-04-2021

Citi USD weakness driven by a move lower in US yields in NY appears to have held in Asia, with most currencies trading around levels seen into the NY close. Nonetheless, there have been a few noteworthy idiosyncratic stories overnight, particularly in EM.INR sees sharp underperformance following the RBI, which held rates, but leaned cautious on the country’s recent Covid-19 outbreak and announced further liquidity measures. Korea rates have also lagged the UST and consequent Asia rates rally, with today’s Seoul and Busan by-elections keeping the market on edge amid the risk of further fiscal stimulus should the ruling party lose in Seoul in particular. More in the EM section below.Data ahead is predominantly centred in the US, with FOMC minutes, Fedspeak and trade data due. Otherwise in EM we look to BRL production inflation, a PLN rate decision (hold) and HUF central bank minutes. Natixis The dollar softened to a two-week low against a basket of currencies on Wednesday after U.S. bond yields declined as traders rolled back aggressive expectations that the Federal Reserve will tighten its policy earlier than pledged.The dollar index hit a two-week low of 92.246, slipping further from a five-month high of 93.439 set on March 31, and last stood at 92.343."Following the dollar's strong gains last quarter, some investors appeared to have over-allocation in dollar assets and they probably need to sell dollars for rebalancing," said Kazushige Kaida, head of FX Sales at State Street Bank's Tokyo branch.The previous quarter saw the dollar's strongest rally in years on rising expectations that accelerating U.S. economic growth and inflation could force the Fed to abandon its pledge to keep interest rates near zero until 2024.The dollar index rose 3.6% in the quarter, its biggest quarterly rise in three years. Against the yen, the U.S. currency rose 7.2%, the largest since the last quarter of 2016.As some bullish bets on the dollar were unwound this week, the euro rallied to a two-week high of $1.18785 and last stood at $1.1867.Similarly, the common currency jumped almost a pence against the British pound overnight to trade at 85.90 pence, its biggest gain since Dec. 10, in a reversal from the pound's steady gains during the last quarter.The dollar was on the defensive at 109.77 yen, extending its retreat from a one-year high of 110.97 touched a week ago. Credit Agricole USD: More caution warranted?The USD has been on the defensive so far this week, regardless of better than expected economic data releases such as Monday’s Services ISM. As such, the most recent price action suggests the USD is trading close to overbought territory, an assessment that is fully in line with our FX positioning data.While it can still not be excluded, that the currency faces renewed upside in the weeks to come, positioning as it stands argues in favour of short-term caution.On top of that, it cannot be excluded that the Fed is turning increasingly cautious on rising risks of unwarranted tightening of financial conditions. From that angle, today’s focus will be on the release of FOMC meeting minutes covering the March monetary-policy announcement.Even though our house view is for the minutes to offer low surprise potential, the minutes could still highlight some nascent concerns about the recent rapid rise in UST yields and the appreciation of the UST TWI.Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 65% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/the-investment-bank-outlook-07-04-2021"
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UK Services PMI Surges Into Positive Territory Over March

Service Sector Rebounds There was some better news for the UK over the early European session today. The IHS reported that the UK services sector finally rebounded into expansionary territory last month, marking an end to almost six months of contractionary readings since October. Despite the data coming in a little below the expected 56.8, at 56.3, the sector is firmly back above the neutral level and saw a sharp improvement on the prior month’s 49.5 reading.Given that services make up around 80% of the UK economy, this can perhaps be seen as a watershed moment in the recovery given that the services sector has long lagged the factory sector, which saw a swift and continued recovery from the lows seen during the height of the pandemic.New Orders & Employment Rise Looking at the breakdown of the report, the IHS noted that there had been a strong rebound in new orders over March, with employment rising sharply also, ahead of the planned easing of restrictions to begin in April. Indeed, the job creation seen in the services sector in March represents the first overall expansion in staffing levels since the pandemic began.Activity Forecast To Pick Up Further On a particularly encouraging note, the survey data showed that 66% of those who responded forecast an uptick in activity over the coming period versus only 8% who predict a decline. Interestingly also, the data showed that some areas of the services sector recorded the positive impact from higher residential property transactions. The main upside contribution came from the much firmer levels of client demand and forward bookings as consumers look ahead to the easing of lockdown restrictions from April onwards at which point the hospitality sector will start to open up.Input Price inflation Soaring There were also signs of increased price pressures in the data, helping feed into the view that inflation is likely to spike sharply once reopening begins. The data showed that there was a sharp uptick in input costs with the rate of input price inflation jumping the most in almost three years. Looking ahead, these greater input costs are likely to be passed onto the consumer, whilst also meeting the level of pent up demand among consumers on the back of lockdown, which should further fuel a lift in inflation supporting GBP in the near term.Technical View EURGBPThe sell-off in EURGBP since the December highs has seen price breaking through several key support levels as the bear channel extends. Price is now retesting the channel high and broken support at the .8591 level. While this region holds, the medium-term focus is for a continuation towards the .8277 level. However, above the channel, .8678 is the next objective for bulls.Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 65% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/uk-services-pmi-surges-into-positive-territory-over-march"
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UK Services PMI Surges Positive Territory Over March

Service Sector Rebounds There was some better news for the UK over the early European session today. The IHS reported that the UK services sector finally rebounded into expansionary territory last month, marking an end to almost six months of contractionary readings since October. Despite the data coming in a little below the expected 56.8, at 56.3, the sector is firmly back above the neutral level and saw a sharp improvement on the prior month’s 49.5 reading.Given that services make up around 80% of the UK economy, this can perhaps be seen as a watershed moment in the recovery given that the services sector has long lagged the factory sector, which saw a swift and continued recovery from the lows seen during the height of the pandemic.New Orders & Employment Rise Looking at the breakdown of the report, the IHS noted that there had been a strong rebound in new orders over March, with employment rising sharply also, ahead of the planned easing of restrictions to begin in April. Indeed, the job creation seen in the services sector in March represents the first overall expansion in staffing levels since the pandemic began.Activity Forecast To Pick Up Further On a particularly encouraging note, the survey data showed that 66% of those who responded forecast an uptick in activity over the coming period versus only 8% who predict a decline. Interestingly also, the data showed that some areas of the services sector recorded the positive impact from higher residential property transactions. The main upside contribution came from the much firmer levels of client demand and forward bookings as consumers look ahead to the easing of lockdown restrictions from April onwards at which point the hospitality sector will start to open up.Input Price inflation Soaring There were also signs of increased price pressures in the data, helping feed into the view that inflation is likely to spike sharply once reopening begins. The data showed that there was a sharp uptick in input costs with the rate of input price inflation jumping the most in almost three years. Looking ahead, these greater input costs are likely to be passed onto the consumer, whilst also meeting the level of pent up demand among consumers on the back of lockdown, which should further fuel a lift in inflation supporting GBP in the near term.Technical View EURGBPThe sell-off in EURGBP since the December highs has seen price breaking through several key support levels as the bear channel extends. Price is now retesting the channel high and broken support at the .8591 level. While this region holds, the medium-term focus is for a continuation towards the .8277 level. However, above the channel, .8678 is the next objective for bulls.Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 65% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/uk-services-pmi-surges-positive-territory-over-march"
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EURGBP – Highest daily close for 2021

Sentix GmbH recorded the highest increase in consumer confidence in the entire Eurozone since August 2018. Although slow vaccine launches and the third wave were the main reasons for the Eurozone’s gloom, there is a basic factor playing a role in a different growth trajectory, namely fiscal policy. The Eurozone is struggling to ratify and implement the Next Generation EU recovery fund, which was agreed upon in July 2020, because the disbursement of funds is still being used for unemployment insurance and it is likely that the first payment related to the fund will not happen until  the second half of this year.

Meanwhile, the February Eurozone unemployment rate was unchanged at 8.3%, worse than expectations of 8.1%, after  the January figure was revised up from 8.1% to 8.3%. The EU unemployment rate was also unchanged at 7.5% in February.

EURGBP – In general, EURGBP is in a downturn in 2021, which has coincided with Britain’s withdrawal from the European Union, or Brexit, as well as the second wave of Covid-19 outbreaks, the latter likely being the main reason for pressing the pair. England was the first country to have good news about the Covid-19 vaccine;  according to Bloomberg, 47.3% of the UK population have  been vaccinated so far, while only 12.7% of the EU population has been vaccinated.

EURGBP, H4.

The pair strengthened significantly yesterday by recording an increase of +1.16%. Even the Support level 0.8538 which was originally broken down and to print a new low of 0.8471 is now being broken up again. A Golden cross of Tenken sen and Kinjun sen has been formed; this provides a strong rebound signal with the price moving above Kumo which will further target the next resistance level at 0.8644.

However, this rebound yesterday and so far today has not confirmed a reversal, because is falls in line with 4-months down channel range and BB range, so it is still possible that it will ran out of steam and might fall back down to re-test back to the 0.8538 level. Early indications of a rebound are already there, as the AO crossing is above the neutral zone, while the descending trendline in the short term (4-hour chart) has also been broken upwards. To ensure that this advance is not just a liquidation of short positions, there needs to be certainty that the price rally will continue past 0.8644 to confirm short term gains.

Yesterday’s significant move was in line with the technical view that sees the occurrence of Bullish Divergence since MACD lines are presenting a decrease of negative bias as price action continues its downtrend. Even though MACD lines are still below the 0 line, a significant Resistance is at the 50-day SMA line at 0.8650, as stated above. Only a break above this level could strengthen the odds of a reversal. On the flipside, a failure to break this level could suggest the continuation of 4-month decline.

Click here to access our Economic Calendar

Ady Phangestu and Chayut Vachirathanakit 

Market Analysts  – HF Educational office – Indonesia and Thailand

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

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Market Update – April 7 – USD & Yields softer, CAD even weaker

Market News Today – US Equities closed flat, USD (2-week lows) and 10-yr yields cool further. JPY sees new financial year bid, EUR, GBP also flat – CAD & AUD crosses weaker. USOil remains under $60.00, Gold holds at $1735. EU unemployment rose unsurprisingly & US JOLTS (job moves and openings) are at 2 yr highs. EU-US disparity continues. Overnight – Asian markets touch 3-week highs – Nikkei also closed flat – Samsung Q1 profits up 45%. European FUTs also flat. India reported record 115,000 virus cases, AZ pause testing vaccine on children and EU talk of 60% of popn. offered vaccine by June.

Week Ahead – RBA (6th) UK, EU & US PMIs & FOMC Minutes (7th), ECB Minutes, Weekly Claims & Powell speech (8th), CAD Jobs & US PPI (9th).

The Dollar has posted fresh lows, which put the USDIndex at a 15-day low at 92.23. The forex market appears to have been somewhat wrong-footed by a pronounced decline in Treasury yields. Inflation worries have been fading a bit, at least for now, as Fed policymakers continue to stress they do not see any problem with price pressures for the foreseeable future. The Fed has also assured it will not hike rates pre-emptively, needing to see real evidence that their goals are being met before acting. At the same time there has been a sputtering phase in US stock markets after the bellwether US indices scaled to record highs on Monday, which has induced a safe haven bid for Treasuries. Investors are digesting prospects for higher corporate taxes linked to President Biden’s $2 bln infrastructure plan, which analysts at GS reckon would trim 9% of earnings per share for companies listed in the S&P 500. The 10-year Treasury yield has pressed below 1.640%, down by around 8 bp from yesterday’s high.

This backdrop has fostered a reversal of recent themes in the currency market, aside from the correction in the Dollar, with the Yen and Euro, currencies that have lately been found in the underperforming lane more often than not, having rebounded notably over the last couple of days. EURUSD has pegged a 15-day high at 1.1883, setting up the pair for what might be its second down week out of the last seven. USDJPY has dropped to a nine-day low at 109.58, setting up what could be the pair’s second down week out of the last six.

The biggest movers out of the main currencies we monitor have been EURCAD and CADJPY. The Canadian Dollar, which has been amongst the strongest currencies on the year so far, being a principal winner in the reflation trade due to its correlation with oil prices, had been looking due for a correction, with the oil price rally having lost traction in recent weeks. This has lifted USDCAD to eight-day highs above 1.2600, despite the prevailing broader weakness in the Greenback. The Pound has also found itself in the underperforming lane, with EURGBP, most notably, having rebounded quite sharply after the cross printed a 14-month low on Monday. Despite the prevailing losses, the UK currency still remains one of the strongest performing currencies when measured from the start of the year.

Today – EZ, UK & US final services & composite PMIs, ECB asset purchases & bi-monthly PEPP summary, DoEs, FOMC minutes, Fed’s Evans, Kaplan, Barkin.

Biggest (FX) Mover @ (07:30 GMT) USDCAD (+0.36%) rallied from test of 1.2500 on Monday to close at 1.2580 yesterday and breach 1.2600 and R2 now. R3 1.2635. MAs remain aligned higher, RSI 71 and in OB zone but still rising, MACD histogram & signal line aligned higher and over 0 line from midday yesterday. Stochs in OB zone but also still rising. H1 ATR 0.0014, Daily ATR 0.0070.

 

Click here to access the HotForex Economic Calendar

Stuart Cowell

Head Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

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China's March forex reserves fall to $3.17 trillion

from Forex News https://www.investing.com/news/forex-news/chinas-march-forex-reserves-fall-to-317-trillion-2467721
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Dollar Lower Despite IMF Optimism On US Recovery

Crisis-End In Sight Risk appetite has been given a further boost this week with the International Monetary Fund upgrading its global growth outlook at the group’s spring meet. In a display of optimism which has been largely shared by many of the G10 central banks and political leaders, the IMF said that as a result of the progress being made with vaccinations, the end of the current “health and economic crisis is increasingly visible”.Global Growth To Improve The IMF’s chief economist Gita Gopinath struck an upbeat tone over the impact from the latest US fiscal package as well as the pace of vaccinations in the US and, albeit on a smaller scale, around the world. With this in mind, Gopinath raised the group’s 2021 global GDPO forecast from 5.5% to 6% while growth is expected to increase by 4.4% in 2022, up from the prior estimate of 4.2% given in January.US Recovery Advancing Quicker Than Elsewhere Looking specifically at the US, Gopinath said that as a result of the $1.9 trillion in fiscal stimulus approved by president Biden, the IMF is forecasting growth of 6.4%, well above the average of 5.1% growth expected in advanced economies this year. The group now forecasts unemployment to fall back to 5.8% this year and 4.1% in 2022. This views echoes that of US treasury secretary Janet Yellen who opined earlier this year that the US could see a return to full employment as early as this year.Risks Remain Ahead However, the IMF’s update was not without warning and Gopinath was clear in stressing that “daunting challenges” and “high uncertainty” remain ahead, particularly with vaccinations in lower-income countries. Globally, currently, only around 3% of people have been vaccinated while in the US, almost 20% have been fully vaccinated now. Looking ahead, Gopinath said “the outlook presents daunting challenges related to divergences in the speed of recovery both across and within countries and the potential for persistent economic damage from the crisis.”Dollar Down On Wage Growth Miss Despite the IMF’s upbeat view on the US, over other advanced economies, the Dollar continues to sell-off midweek as traders dial back their Fed tightening expectations on the back of last week’s negative wage growth number for March.Technical View DXYFollowing the breakout above the bearish trend line from mid 2020 highs DXY has been trading higher within a tight bullish channel. However, selling pressure has kicked in ahead of a test of the 93.91 level with price now reversing under the bullish channel and heading for a test of 92.07, which will be a key pivot for price. While this level holds, a further push higher can still be seen. Below there, the 90.98 and 89.64 levels are back in play.Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 65% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/dollar-lower-despite-imf-optimism-on-us-recovery"
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Vipshop: What to expect after Archegos is liquidated?

The latest news from Credit Suisse following  the Archegos Capital liquidation incident is that it has once again sold its stocks related to the fund, with a total value of more than 2 billion US dollars, including  as many as 14 million Vipshop stocks. In fact, since the news of Archegos’s liquidation was made public, many banks, such as Goldman Sachs, Morgan Stanley, Deutsche Bank, and Wells Fargo Bank have immediately forced liquidation of the company’s positions. According to Bloomberg’s estimates, the hedge fund’s liquidation may cause a loss of 100 billion US dollars, which means that there are more stocks to be sold.

Vipshop is established in many places in China and mainly operates as an online shopping firm. The products sold on its website include clothing, cosmetics, daily necessities, toys, etc. After news of the Archegos crash broke, Vipshop’s stock price also gave up its gains over the past few weeks and fell to a low of US $24.75. On March 30, Vipshop announced the repurchase of 500 million US dollars of stock; however, this news only boosted the stock price to a maximum of $32.38 in the short term. As of yesterday’s close, the company’s stock price continues to be under pressure below the $30 level, at $29.75.

In the stock market, people often  say “A bad week or two will not eliminate the long-term upward trend“, meaning that stock price is ultimately guided by the value of the company, and this value determines whether investors choose to continue to hold the company’s stock. Therefore, when the stock price plummets, such as in the case of Vipshop, we need to have a thorough understanding of the nature of the company before we can decide whether it is worth continuing to hold, or establish a new position at a low price.

In the past year, Vipshop’s earnings per share and sales volume increased by 23.68% and 22.15% respectively. Effective merchandise sales and brand strategy, a solid supply chain network, the number of active customers and the growth of orders have provided favorable support for the company. In fact, the company’s sales and revenue growth in the past five years have both recorded a rise of more than 150%. This may reflect that Vipshop still has the potential for continuous growth.

Since the outbreak of the pandemic, most companies engaged in online businesses have benefited. A poll conducted by the Netcomm Suisse Observatory in Switzerland and the United Nations Conference on Trade and Development (UNCTAD) showed that out of the  227  Chinese consumers surveyed, 78% of respondents said they are now more inclined to online shopping. This ratio is significantly higher than the other 8 countries:

Figure 1: The trend of online shopping among consumers in nine countries during the pandemic. Source: https://unctad.org/system/files/official-document/dtlstictinf2020d1_en.pdf

In addition, the survey also revealed the percentage of active online shoppers who make online purchases at least once every 2 months, as shown in Figure 2:

Figure 2: Percentage of active online shoppers who do online shopping at least once every 2 months. Source: https://unctad.org/system/files/official-document/dtlstictinf2020d1_en.pdf

Data shows that during the pandemic, the number of people who bought cosmetics and personal care items online at least once every two months recorded an increase of 6%, while the number of people who bought clothing and accessories online recorded an increase of 2%. Although unfortunately the data has not been refined into the consumption ratio of different products in various countries, we can see from this that the pandemic has helped Vipshop, which mainly sells cosmetics and clothing.

Figure 3: Chinese and Turkish consumers are the most inclined to continue shopping online after the pandemic. Source: https://unctad.org/system/files/official-document/dtlstictinf2020d1_en.pdf

It is worth noting that among the Chinese consumers interviewed, 62% said they are more willing to continue shopping online after the pandemic is over, while less than 5% said they prefer to shop in physical stores.

Based on the above data, it’s good news for Vipshop, both during the pandemic and after it ends. Of course, we have to return to the fundamentals of the company in the end; as long as the company can maintain its core competitiveness, provide satisfactory services and retain customers, and even successfully develop a larger customer base, the company’s prospects will be positive.

The weekly chart shows that #Vipshop’s share price has recorded a strong decline of more than 47% from its high of 45.99. It is currently trying to test and break through the key support of 30.00. At the same level, the teeth of the crocodile line (red) are also included. Although the indicator is long arranged, its green and red moving averages have turned downward. In addition, the AO indicator shows that the red column is gradually shrinking; the relative strength indicator (RSI) is at the 50 level and the Stochastics fast line is below the 50 level.

Judging from the daily chart, AO is in the negative zone, but the red column has turned into a white column. In terms of short-term trends, if the stock price rebounds, the upper resistance will focus on 32.85 (daily FR38.2%) and 35.35 to 36.15 levels. If the stock price successfully breaks through the current key support of 30.00, the target below will focus on the low point seen on March 26 – the 24.75 to 25.15 (weekly FR50.0%) area. The second key support is at 20.25 (weekly FR61.8%).

Click here to access our Economic Calendar

Larince Zhang

Market Analyst – HF Educational Office

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

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Dollar Edges Higher; Fed Minutes in Focus

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Daily Market Outlook, April 07, 2021

Daily Market Outlook, April 07, 2021 Equity markets in the US closed slightly lower after recently scaling new highs, and were mixed in Asia. The IMF yesterday revised up its global growth forecast for this year to 6.0% from 5.5%, but warned about uneven growth prospects between advanced and emerging economies. US GDP growth was raised to 6.4% from 5.1% and UK growth to 5.3% from 4.5%.Today’s final readings of March services PMIs are expected to reaffirm expansion in the UK and marginal contraction in the Eurozone. Final US services PMI, released on Monday, were revised up slightly to 60.4 from 60.2, outpacing their European counterparts, while the separate ISM services survey also signalled buoyant activity by rising to a record high of 63.7. Expect a slight upward revision to today’s UK services PMI to 57.0 from 56.8. That would move it further above the key 50 level confirming a return to expansion in the survey for the first time since October.For the Eurozone services PMI, the preliminary flash March print of 48.8 beat expectations (as was also the case in the UK), but it remained in contraction territory for a seventh consecutive month. Today’s final release is expected to confirm that first estimate. More broadly, however, a stellar result for Eurozone manufacturing PMI (with the output index at 63.3) means the overall composite PMI will likely reaffirm a return to overall growth for the first time in six months. The impact of further containment measures to combat the recent rise in Covid cases, though, remains to be seen.The US services surveys reaffirm very strong economic growth momentum, led by fiscal stimulus measures and progress in the vaccination campaign. Despite that, the Fed has indicated that it is too early to signal any change to its policy stance just yet. The minutes of the 16-17 March FOMC meeting will be published this evening. Before the minutes, a number of Fed speakers (Evans, Kaplan, Daly and Barkin) are scheduled to appear.G10 FX Options Expiries for 10AM New York Cut(Hedging effect can often draw spot toward strikes pre expiry if nearby)Technical & Trade ViewsEURUSD Bias: Bearish below 1.1880 targeting 1.16EURUSD From a technical and trading perspective, as 1.1880 contains upside corrective moves, bears target a test of 1.16. A close through 1.19 would relieve downside pressure opening a retest of 1.20 offersFlow reports suggest downside bids into the 1.1700-1.1680 area with weak stops on a move through and then congestive bids into the 1.1650 area and continuing through to the 1.1600 where better bids are likely to be seen with weak stops through the level opening a deeper move as a possibility. Topside offers into the 1.1880 level and then stronger offers likely through into the 1.1900 area with short term sellers likely to fade the move with weak stops likely to have stepped a little away from the usual 1.1920 area and then stronger offers again appearing on any push at the 1.1940-60 area and the congestion then increasing on any move through to the 1.2000 area.GBPUSD Bias: Bullish above 1.3910 bearish belowGBPUSD From a technical and trading perspective, as 1.3910 contains upside attempts there is a window to test the downside equality objective at 1.3550. A close through 1.30 would suggest the current correction is complete opening a retest of 1.40 offersFlow reports suggest topside offers congested around the level and increasing through to the 1.3900 area, some weak stops likely to be absorbed by congestion that is likely to continue through to the 1.4000 area before stops increase. Downside bids light through the 1.3800 level and then light bids through to the 1.3700 area where bids are likely to increase through to the 1.3650 area before weak stops appear.USDJPY Bias: Bullish above 109 targeting 112USDJPY From a technical and trading perspective, as 109.50 continues to attract support bulls will look for a test of 112. A loss of 109.30 opens a retest of bids at 108.50Flow reports suggest topside light congestion through to the 110.80 level before weak stops then weakness through to the stronger offers around the 111.80 area matching the highs from the beginning of the previous two years at the same period of time, a break of the 112.30 area is likely to see strong stops appearing and the market opening for further push beyond the last couple of years highs. Before running through to the 112.50 area and another set of stronger offers appearing continuing through to the 112.80 level and likely continue seeing strong offers, downside bids light back through the 110 level and likely to continue to 109.80 with weak stops likely through the level and weak through to the 109.00 area.AUDUSD Bias: Bearish below .7700 targeting .7453AUDUSD From a technical and trading perspective, as 7700 contains upside advances bears will target a test of the downside equality objective at .7453 before trend resumption may developFlow reports suggest light offers through the 0.7700 area with weak stops through the level and the market opening to the 78 cents area before stronger offers through to the 0.7840-60 area and then increasing offers onwards through 0.7900, with the offers likely to continue through to the 0.7950 area and likely increasing resistance through to the 0.8000 levels, downside bids into the 76 cents level with strong bids likely through to the 0.7580 area, weak stops are likely to be few and far between with stronger bids likely into the 0.7550 level and likely stronger congestion through to the 0.7500 area.Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 65% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/daily-market-outlook-april-07-2021"
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