MNI China Daily Summary: Friday, April 26

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CAD Rebuffs S/T Bearish Theme, as GDP Lends Support

FOREX
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  • Both CAD and CHF pushed back against previous bearish price action to trade higher through the Thursday close, as window-dressing and month-end flows worked against S/T trends evident in the price action across the past two weeks.
  • USD/CAD headed through the London close at the session's lowest levels, extending the post-GDP data losses and pushing back against the bullish outlook. For now, the outlook remains positive above first support at 1.3456 and the bear trigger at 1.3420.
  • Key short-term resistance is at 1.3614, the Mar 19 high and a recent congestion level. A clear break of this hurdle would confirm a resumption of the uptrend that began on Dec 27. This would expose 1.3623, a Fibonacci retracement, and 1.3661, the Nov 27 high.
  • The USD Index started the Thursday session among the session's best performer, before giving back gains across US hours. Most sell-side models had seen moderate dollar sales as part of month-end rebalancing flow - and a small part of these flows may have played out, with modestly soft Q4 PCE numbers adding to the weight on the currency.
  • Focus in the coming week turns to Eurozone inflation numbers, the 1-yr, 3-yr inflation expectations survey as well as the March jobs report rounding off the week on Friday. Markets currently expect the US to have added 215k jobs over March, down from 275k in February.
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  • Both CAD and CHF pushed back against previous bearish price action to trade higher through the Thursday close, as window-dressing and month-end flows worked against S/T trends evident in the price action across the past two weeks.
  • USD/CAD headed through the London close at the session's lowest levels, extending the post-GDP data losses and pushing back against the bullish outlook. For now, the outlook remains positive above first support at 1.3456 and the bear trigger at 1.3420.
  • Key short-term resistance is at 1.3614, the Mar 19 high and a recent congestion level. A clear break of this hurdle would confirm a resumption of the uptrend that began on Dec 27. This would expose 1.3623, a Fibonacci retracement, and 1.3661, the Nov 27 high.
  • The USD Index started the Thursday session among the session's best performer, before giving back gains across US hours. Most sell-side models had seen moderate dollar sales as part of month-end rebalancing flow - and a small part of these flows may have played out, with modestly soft Q4 PCE numbers adding to the weight on the currency.
  • Focus in the coming week turns to Eurozone inflation numbers, the 1-yr, 3-yr inflation expectations survey as well as the March jobs report rounding off the week on Friday. Markets currently expect the US to have added 215k jobs over March, down from 275k in February.