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EUR/CAD approaching resistance, potential drop!





EURCAD is approaching our first resistance at 1.5033 (horizontal overlap resistance, 61.8% Fibonacci extension , 23.6% Fibonacci retracement ) where a strong drop might occur to our major resistance at support at 1.4925 (horizontal swing low support). RSI (34) is also approaching resistance and ichimoku cloud is also showing signs of bearish pressure. Trading CFDs on margin carries high risk. Losses can exceed the initial investment so please ensure you fully understand the risks.


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Australia Building Approvals Surge 19.1% In February





The total number of building approvals in Australia jumped a seasonally adjusted 19.1 percent on month in February, the Australian Bureau of Statistics said on Tuesday - coming in at 17,074.


That was way above forecasts for a fall of 1.8 percent following the 2.5 percent gain in January.


On a yearly basis, building approvals sank 12.5 percent - but that also beat expectations for a fall of 27.0 percent after tumbling 28.6 percent in the previous month.


The seasonally adjusted estimate for private sector houses fell 3.6 percent in February, while private sector dwellings excluding houses surged 64.6 percent. The value of total building approved rose 15.4 percent in February.


The value of residential building rose 24.7 percent, while the value of non-residential building rose 2.1 percent.


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Australia Has A$4.801 Billion Trade Surplus





Australia posted a seasonally adjusted merchandise trade surplus of A$4.801 billion in February, the Australian Bureau of Statistics said on Wednesday.


That beat expectations for a surplus of A$3.70 billion and was up from A$4.549 billion in January.


Exports were flat on month at A$39.833 billion. Non-rural goods rose A$127 million, while non-monetary gold fell A$142 million (7 percent) and rural goods fell A$44 million (1 percent). Net exports of goods under merchanting remained steady at A$10 million. Services credits rose A$136 million (2 percent).


Imports fell 1.0 percent to A$35.032 billion.


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The players believed in the euro, but the signal was "bearish"





The euro stopped a six-day decline and increased due to the fact that market participants believed in it. Improving the mood for risky assets is supported by optimism about the deal between the US and China and strong data for China and the eurozone. The euro is rising, while German bonds are falling, and the 10-year yield has risen briefly above zero.


Imports fell 1.0 percent to A$35.032 billion.


The dollar missed the initiative, the EUR/USD pair added 0.45% at $ 1.1252 on Wednesday. The ability to stay above the March lows led to triggering trailing stops, with a huge number being placed above $1.1250. This information was shared with Bloomberg by two traders from Europe.


Purchasing manager indices for the services sector in March surpassed all four major economies in the region. In this regard, some concerns over the decline in production have softened.


Bear slope


Meanwhile, strategists who write for Bloomberg, warned that the general signal for the euro remains bearish for the long term.


It is worth recalling the deeply negative real yield, the high level of debt and the stubbornly slow growth of the region's economy. Factors that could protect the euro, are frankly little, so the currency will weaken in the coming months.


The exception is that the euro will be used as a safe-haven in times of stress due to the region's current account surplus and relatively low currency volatility. However, the current account surplus slightly decreases.


Additional pressure on the single currency will come from parliamentary elections in the European Union in May and early elections in Spain. Political tensions in France and Italy will also add pressure on the euro.


Brexit consequences for Europe


Now they are actively discussing the possible consequences of an exit without a deal. This is dangerous not only for Britain itself, but also for Europe and the world economy as a whole. Investors are forced to admit that the "hard" scenario next week is not only not excluded, but also quite possible.


Goldman Sachs tried to describe the economic effect of Brexit 2.5 years after the referendum. The picture turned out, to put it mildly, alarming.


So, during the week after the referendum, the UK economy lost 2.4% of GDP, or about 600 million pounds. Most of these losses relate to business investment, so the bank is inclined to believe that experts underestimated the effect of political uncertainty.


Brexit every 2.5 years is a major stimulant for the UK markets and investments. In the first quarter of this year, growing uncertainty reduced investment growth by 5% in quarterly terms.


Major investments (airplanes, trains, and equipment) and services (hotels and restaurants) are most severely affected, heightening the threat of recession in the European industrial sector.


Another shock


As noted by the bank, risky assets in the world markets were affected by the referendum's results, especially in Europe. Since an exit without a deal would be another shock, then this situation may happen again.


The "soft" scenario next week will support the UK economy. With a random exit, the European economy will suffer negative consequences for several years.


The strengths of the ECB are not limitless


Of course, the regulator is able to remove the painful symptoms of the initial shock in the financial market. In this case, it will resume buying bonds and reduce the profitability of Italian securities. However, the ECB is unlikely to cope with a third recession over the past 10 years.


Worst of all, the central bank is already backing down, retreating from its plans to tighten policies and promising that it would keep low rates until the end of this year. It turns out that the regulator has a limited arsenal of tools to mitigate the consequences of a negative scenario.


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Euro Mixed Ahead Of German Industrial Production





Destatis will publish German industrial production for February at 2:00 am ET Friday. Ahead of the data, the euro traded mixed against its major counterparts. While the euro fell against the yen, it held steady against the rest of major counterparts.


The euro was worth 125.39 against the yen, 1.1227 against the franc, 0.8564 against the pound and 1.1229 against the greenback as of 1:55 am ET.


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Japan Has Y2,676.8 Billion Current Account Surplus





Japan had current account surplus of 2,676.8 billion yen in February, the Ministry of Finance said on Monday.


That exceeded expectations for a surplus of 2,633.5 billion yen following the 600.4 billion yen surplus in January.


Exports were down 1.9 percent on year to 6,307.0 billion yen, while imports skidded an annual 6.6 percent to 5,817.8 billion yen.


The trade surplus came in at 489.2 billion yen, shy of expectations for 591.3 billion yen but up from the 964.8 billion yen deficit in the previous month.


The adjusted current account showed a surplus of 1,957.6 billion, beating forecasts for 1,920.9 billion yen and up from 1,833.0 billion yen a month earlier.


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Japan Producer Prices Add 0.3% In March





Producer prices in Japan were up 0.3 percent on month in March, the Bank of Japan said on Wednesday - exceeding expectations for 0.2 percent and unchanged from the February reading.


On a yearly basis, producer prices climbed 1.3 percent - again topping forecasts for 1.0 percent and up from 0.9 percent in the previous month.


Export prices added 0.8 percent on month and 0.2 percent on year, the bank said, while import prices jumped 1.6 percent on month and 2.5 percent on year.


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Japan M2 Money Stock Gains 2.4% On Year In March





The M2 money stock in Japan was up 2.4 percent on year in March, the Bank of Japan said on Thursday - coming in at 1,012.7 trillion yen.


That was in line with expectations and unchanged from the previous month's reading.


The M3 money stock climbed an annual 2.1 percent to 1,344.7 trillion yen - also unchanged from a month earlier and matching forecasts.


The L money stock advanced 2.4 percent on year to 1,794.0 trillion yen, up from the 2.1 percent increase in February.


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What is the main driver for the dollar/yen pair today?





After closing in negative territory for three consecutive days and dropping to a low in April, the USDJPY pair changed direction and rose to its highest point of 111.35


The strong dollar seems to be supporting the pair's recovery today. Against the background of positive statistics, the US dollar index rises above the level of 97.00 today, erasing the losses of yesterday.


According to the results of the weekly report of the US Secretary of Labor, it became known that initial applications for unemployment benefits fell to a low from 1969, by 196 thousand in the week to April 5. In addition, the producer price index rose 0.6% for the month and 2.2% for the year. Both figures were higher than market expectations.


Also, by 0.75%, the yield on 10-year treasurers rises, which serves as an additional impetus for the dollar/yen pair.


Today, the speech of the head of the Federal Reserve Bank of St. Louis, James Bullard is expected, the main topic of which will be the assessment of the market value of the dollar, which is likely to become the main driver for the USDJPY pair.


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