ECB monetary decision today. On the road of policy normalization?

and other FX market news


    What’s new?

    The EUR soar yesterday top crossing its major horizontal support at 1.0866. Technicals shows a potential bullish reversal. All eyes are now on the ECB, which is set to maintain its speedier withdrawal of stimulus at the tonight meeting. The corporate earnings season will start tonight as well with majors U.S bank publish Q1 2022 results. Investors will assess if the war in Ukraine, supply chain disruptions, and high inflation are hurting profits…

    The JPY bounced back from a two-decade low against the USD after shorter maturity Treasuries climb suggesting investors are repricing at what pace the FED is wiling to go in hiking cycle. Indeed, U.S consumer-price published last today show that inflation might have peaked.

    China is expected to cut a key policy interest rate for the second time this yearn Friday and reduce the reserve requirement ratio soon that will free some fresh capital in the market.

    What’s in the pipe?

    • ECB rate decision, Thursday
    • U.S. retail sales, initial jobless claims, business inventories, University of Michigan consumer sentiment, Thursday
    • Cleveland Fed President Loretta Mester, Philadelphia Fed President Patrick Harker due to speak Thursday
    • U.S. stock and bond markets are among those closed for Good Friday

    FX rates

    USD/JPY @ 126.04 - bullish trend

    RSI : Overbought

    Williams %R : Overbought

    Bounce off oblique resistance : 126.49

    EUR/USD @ 1.0908 - Bearish trend

    Potential bullish reversa

    GBP/USD @ 1.3135 - Bearish trend
    Potential bullish reversa

    AUD/USD @ 0.744

    USD/CNH @ 6.3795

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