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By eFXdata  —  Apr 03 - 01:45 PM

Citi discusses GBP/USD technical outlook and flags a scope for further downside in the near-term. 

"GBP is challenged from various angles and continues to trade below 1.2400, failing to regain momentum above the 1.2465-75 area...Daily momentum is the most overbought it has been since we went to the peak in GBPUSD in December 2019 at 1.3514...CitiFX Technicals: This Cable Is Frayed. Is It About To Snap?," Citi notes. 

"GBP has also dropped sharply in our latest G10 Scorecard and now ranks the lowest among G10 due to poor current account and GDP growth forecasts, along with negative inflation surprises. USD and EUR rank only slightly better, remaining in the bottom 5 with the dollar overvalued and the euro suffering from poor economic data from the region," Citi adds. 

Citi Research/Market Commentary
By Christopher Romano  —  Apr 03 - 02:00 PM
  • Pair drops sharply after EZ March PMI data, near 1.0800 at NY open

  • US March jobs below estimates, US$ & yen bought, EUR/USD drops nL1N2BR0HP

  • EUR/USD slide stalls near 1.0770 as US$ buying erodes after Europe's close

  • Limited bounce though as longs stay side lined, pair near 1.0800 late

  • Techs are bearish, 61.8 Fib of 1.0636-1.1148 breaks, RSIs dropping

  • U.S. dollar's reign likely to persist despite downside risks nL1N2BR0PI

eur/usd IMAGE Click here

Refinitiv IFR Research/Market Commentary
By Paul Spirgel  —  Apr 03 - 01:25 PM
  • GBP/USD soft into week's end -1.28% at 1.2235; NY range 1.23-1.2205

  • Pair offered after weak UK PMI's nL8N2BR2UC & US NFP miss nL1N2BQ2V5

  • Supt 1.2205 Fri low, 1.2170 10DMA & 1.2075 38.2% Fib of 1.1413-1.2484 rise

  • US data hints at depth of glbl econ malaise, spurs USD safe haven buying

  • Sterling bulls flee as UK PMI, dollar haven flows dim outlook nL1N2BR0NZ

  • EUR/GBP +0.65% at 0.8812, Fri range 0.8837-0.8741; cross traders take profits ahead of weekend

GBP Chart: Click here

Refinitiv IFR Research/Market Commentary
By eFXdata  —  Apr 03 - 12:35 PM

MUFG Research discusses USD/CAD outlook and adopts a bullish bias targeting the pair around 1.46 in Q2.

"The Canadian dollar is getting hit from all angles possible and was the 3rd worst performing G10 currency in March, declining 4.7%. As one of the central banks in the G10 space that was slower to ease ahead of the COVID-19 crisis, it therefore became more aggressive than most in terms of rate cuts – the BoC cutting 150bps in March. Not only that but CAD had the plunge in crude oil prices to contend with and also bordering the country with the largest number of virus cases in the world," MUFG notes. 

"Our oil outlook is likely to act as a drag on CAD certainly over the short-term. We certainly see scope for CAD to be a laggard in the G10 space through this crisis given the oil element and the proximity to the US where the COVID-19 crisis is escalating. So our USD/CAD profile lower as the crisis eases is somewhat softer to reflect the greater negatives for Canada," MUFG adds. 

MUFG Research/Market Commentary
By Christopher Romano  —  Apr 03 - 10:25 AM

Investors are streaming into the dollar as the preferred harbor to ride out the intensifying COVID-19 economic storm, driving EUR/USD to a new 7-day low and putting key Fibo support in play.
Today's huge downside miss to March employment data nAQN02D34D did little to stem the rally in the U.S. currency, which remains in demand as a safe haven even after massive Fed liquidity injections alleviated dollar funding pressures nL1N2BR0JYnL1N2BR0IE.
EUR/USD bears were emboldened after the 61.8% Fibo of 1.0636-1.1148 broke, and they could gain additional traction if key support breaks.
The 1.0755/60 support zone contains the March 25 daily low and 76.4% Fibo of 1.0636-1.1148.
The 76.4% Fibo is often an area where reversals occur, but it might just break under current circumstances.
Daily and monthly RSIs indicate solid downside momentum.
That in combination with dollar buoyancy could drive a break below 1.0755/60.
Stops are likely to be run if that zone breaks and EUR/USD's slide should intensify.
Bears will then target the March 23 low at 1.0636.

eur/usd IMAGE Click here

Refinitiv IFR Research/Market Commentary
By eFXdata  —  Apr 03 - 10:00 AM

Citi discusses EUR/JPY technical outlook and flags 2 scenarios as the cross is approaching the key pivotal zone 15.88-115.96.

"EURJPY is approaching pivotal support a round 115.88 (recent low in Sept. 2019) and 115.96 (76.4% pullback of the 109.30-137.51 rally.)," Citin notes. 

"There are 2 potential scenarios here: A double bottom is being formed around the 116 area with a neckline around 123 and a potential target of 130 OR  A weekly close below the 115.88-96 range would open up the way for a test of the June 2016 lows at 109.30.

Which is it to be? Time will tell, but this area looks to be hugely pivotal,": Citi adds. 

Citi Research/Market Commentary
By eFXdata  —  Apr 03 - 08:57 AM

Bank of America Global Research discusses its current bias on G10 FX and maintains a defensive approach, expressing that via straying short EUR/JPY via options and long USD/CAD in spot targeting a move towards 1.5250. 

"We don't believe that markets are pricing the global recession that we are forecasting and we remain positioned defensively in FX.

We expect a stronger USD, both because of continued demand for safety and a US recession less severe than in the rest of the world. We are bearish on the EUR because of a worse recession and the lack of sufficient fiscal policy coordination and no debt mutualization. We expect a stronger JPY, including against USD, thanks to lower oil prices, less outward M&A activity, and likely lower USD demand by Japanese institutions," BofA notes. 

We expect GBP to remain supported as the funding pressures ease and, we remain cautious about high-beta currencies. We are short EURJPY and long USDCAD," BofA adds. 


*Recorded in eFXplus Orders

BofA Global Research
By Christopher Romano  —  Apr 03 - 07:50 AM
  • Risk-off ahead of US employment data; stocks, copper & AUD/JPY fall

  • Safe havens US$ & yen bought, especially after EZ PMI data nZRN000BNP

  • USD/CNH rallies & EM currencies still weak against the greenback

  • AUD/USD dives below the 10-DMA and trades down to a 0.5980 low

  • Short-term structural support in 0.5935/55 zone is now threatened

  • RSIs imply bear momentum remains, a test of that support seems likely

  • US March employment data due & could induce more risk-off trading

aud/usd IMAGE Click here

Refinitiv IFR Research/Market Commentary
By Peter Stoneham  —  Apr 03 - 05:50 AM

Last week's impressive 11-cent GBP/USD recovery shook the bear market hard but sterling has lost traction this week and now threatens to resume its 2020 bear trend.
Big technical resistance points were under pressure but held.
Failure to drive home an upside breach of a bullish continuation pattern (flag) last session has caused the pound to fall sharply early Friday.
The bull pattern would be negated by price dropping under the March 31 1.2241 low.
As the bears regain control and the hunt for safety drives flows into the U.S. dollar, the market will target retracement levels off the March 20 1.1413 to March 27 1.2484 recovery.
The key Fibonacci retrace level, 50%, is at 1.1949 and this could prove to be a tipping point for another significant down leg.
Initial technical support runs in close to market.
The 21DMA is at 1.2263, March 31 low at 1.2241 and 10DMA at 1.2173.
For the bullish continuation pattern to get back onside, a move above 1.2428 would be needed.

GBP/USD daily candle chart: Click here

Refinitiv IFR Research/Market Commentary
By Peter Stoneham  —  Apr 03 - 04:15 AM
  • Safety plays dominate and dollar gains vs Europe accelerate

  • However, cable option volatility has come away from its heady highs

  • Benchmark 1-mth 13.0 vs 26.0 at its peak (was 5.5 in Feb)nL1N2BQ0B1

  • GBP/USD continues to slide: economic impact of pandemic fears gripping

  • Daily bearish continuation pattern playing out: 1.2428 resistance line

  • Latest Reuters poll: GBP forecasts slashed nL8N2BQ274

  • UK Service sector PMI for Mar due 0830 GMT: 34.8 exp. Vs 35.7 Feb

GBP/USD daily candle chart: Click here

Refinitiv IFR Research/Market Commentary
By Martin Miller  —  Apr 03 - 03:05 AM
  • EUR/USD Thurs closed under the 1.0892 Fibo, weakening the market structure

  • 1.0892 Fibo, a 50% of the 1.0636 to 1.1148 near-term recovery move

  • A daily close under the 1.0832 Fibo would quicken the decline

  • 1.0832 Fibo, 61.8% retrace of the same 1.0636 to 1.1148 gain

  • EUR/USD Trader TGM2334. Previous EUR/USD update nL1N2BQ0E1

  • Dollar on course to complete a "V Wave" recovery next week nL1N2BL06P

Daily Ichimoku Chart: Click here

Refinitiv IFR Research/Market Commentary
By Jeremy Boulton  —  Apr 03 - 02:20 AM
  • S Korea sold USD 9 billion dollars in effort to stabilize won nL1N2BR06B

  • Total Swiss sight deposits up CHF 20 billion. 35% reserve USD nAPN0DJ8S9

  • Norway's CB buys record NOK 2 billion per day, may intervene nL8N2BO2JK

  • Russia CB selling USD 205 mln of foreign currency per day nL8N2BQ24L

  • EUR share of Russia reserve trimmed to 30.3 from 30.6% nR4N2AC024

  • Many other EM CBs have intervened in increasing size

  • Many of the dollars sold are recycled by selling EUR/USD

EUR/USD: Click here

Refinitiv IFR Research/Market Commentary
By Andrew M Spencer  —  Apr 02 - 11:30 PM
  • Off 0.15%, at the base of a tight, quiet 1.2374/1.2398 range pre US payrolls

  • POLL-Sterling to regain some lost ground but forecasts slashed nL8N2BQ274

  • GBP on hold close to mid point of March range, gravitating around 1.2400

  • 1.2517, 61.8% March fall is major resistance, break targets 1.2662 200 DMA

  • Thursday's 1.2349 low then this week's 1.2241 base are initial supports

  • Price action this week has been totally different to the March mayhem

  • Suggests what needed to be covered has been - awaiting an outlook change

  • 1.2662 200 DMA & 1.1949 50% March bounce, is a potential broad range

gbp2 apr 3 IMAGE Click here

Refinitiv IFR Research/Market Commentary
By eFXdata  —  Apr 02 - 03:00 PM
Nordea Research discusses the USD outlook and adopts a bearish bias in the medium-term but warns that it's too early to position structurally for such weakness. 
"The launch of the QE-ternity program from the Fed will likely prove to be a material negative USD game-changer down the road. A LOT of new USDs will be printed, which is usually a USD negative story, but we are not sure that QE matters a lot in the short term, if curfews are prolonged and disinflationary risks remain high. So far, the price action since the Fed launched the QE-bazooka has been supportive of inflation expectations, which is a negative USD story. Ultimately, we remain firm that a negative USD bias is very warranted over the next 6-12 months (10% weaker USD is not out of the question), but we think it is too early to really buy into the negative USD story," Nordea notes. 
"In a complete meltdown globally, we would reckon that EUR/USD could go to parity or even below (Cable would like also go to parity), but we are not ready to call for such a scenario, but consider the tail risk very fat on the global scenario – also in FX space," Nordea adds. 


Nordea Research/Market Commentary
By Andrew M Spencer  —  Apr 02 - 11:05 PM
  • Flat in a tight 0.6046-0.6068 range - modest flow - total change from March

  • Appears risk covered in March - Asia is now waiting for an outlook change

  • Retail sales were resilient at +0.5% - poll +0.4% - but had no impact

  • Aus government ramps up borrowing to pay for virus stimulus nL4N2BR0KW

  • Aus closes internal borders as unsourced coronavirus cases rise nL4N2BQ4SA

  • AUD consolidates around the 0.6098 midpoint of the March range

  • Unless the coronavirus outlook changes, range trading is viable

  • 0.5945, 38.2% March bounce and 0.6236 61.8% of the March fall could work

aud 2 apr 3 IMAGE Click here

Refinitiv IFR Research/Market Commentary
By Andrew M Spencer  —  Apr 02 - 08:40 PM
  • Flat into retail sales, which came in at +0.5% - poll +0.4% - no impact

  • Asian price action has totally changed from the volatility in March

  • Price consolidates around the 0.6098 midpoint of the March range

  • If the uncertain coronavirus outlook is unchanged, range trading is viable

  • 0.5945, 38.2% March bounce and 0.6236 61.8% of the March fall could work

  • 0.6007 NY low and 0.6121 21 DMA are initial support-resistance

aud apr 3 IMAGE Click here

Refinitiv IFR Research/Market Commentary
By Andrew M Spencer  —  Apr 02 - 06:45 PM
  • Flat after broad weakness yesterday with EUR/USD off 0.95% and EUR/GBP -1.1%

  • Failure to find joint mechanisms to finance EU recovery nL8N2BQ3EK weighed

  • EU Commission apologises to Italy over coronavirus response nL8N2BQ73P

  • Divisions between rich and poor EU members slows EU, undermining confidence

  • Charts; momentum studies, 5, 10 & 21 DMAs conflict - neutral setup

  • 1.0831, 61.8% March rebound held, sustained break targets 1.0636 March low

  • NY 1.0821 low and early London 1.0964 high initial support-resistance

eur apr 3 IMAGE Click here

Refinitiv IFR Research/Market Commentary
By eFXdata  —  Apr 02 - 01:30 PM

MUFG Research discusses USD/JPY outlook and maintains a structural bearish bias in the medium-term. 

"Fears of a global economic recession roiled the markets in March. The dollar fluctuated wildly, with the USD/JPY trading in a range of over 10 yen during the month. With still no end in sight for containing the Covid-19 pandemic, elevated tensions could push the dollar higher again, although dollar supply operations by several central banks have allayed concerns of tight dollar supply/demand, MUFG notes.

"We expect the USD/JPY to trend lower on the whole. Naturally, the dollar could come under renewed upside pressure given the highly uncertain outlook for the extent and duration of Covid-19's impact on economic activity and market sentiment. That said, movement in March indicates that these factors are unlikely to result in sustained dollar strength. Overall, we forecast the USD/JPY will decline at a moderate pace. We also see scope for the pair to fall below 100 over the period of our forecast.," MUFG adds. 


MUFG Research/Market Commentary
By Randolph Donney  —  Apr 02 - 01:55 PM
  • USD/JPY managed to shrug off horrible U.S. jobless claims report

  • Hard to shock the market at this stage, prepped for more bad news

  • USD/JPY back above 108 on Trump oil production cut comments nL1N2BQ180

  • Saudis call for emergency OPEC+ and others to meet nC6N2BA008

  • Brent and WTI up 20%+ but latter's high capped by the 21-DMA

  • Pandemic cutting demand by 30 mln bpd vs 10-15 mln bpd cuts mooted

  • USD/JPY eyes 200-DMA at 108.33 with $1.8bln 108 expiries on Friday

  • 1-mo RRs are as bearish as they were day before 101.18 low was hit

  • Daily on-close reversal point of downtrend is Tuesday's 108.80 high

  • Risk bias remains bearish while S&Ps are below 38.2% Fibo at 2,651

  • Friday's NFP report seen as old news, services ISM a bit fresher

Chart Click here

Refinitiv IFR Research/Market Commentary
By Paul Spirgel  —  Apr 02 - 01:15 PM
  • GBP/USD soft into NY close -0.1% at 1.2360; NorAm range 1.2455-1.2352

  • Pair remains offered abv 1.2450 for 5th straight day by 30-DMA 1.2471

  • Unable to make new highs traders eye 21-DMA support by 1.2296

  • US claims miss hints at more dire global growth risks nAQN006QXN

  • Gravestone doji hints GBP bulls may capitulate and eye 21-DMA supt by 1.2295

  • GBP losses vs USD lag euro and yen as GBP claws back mid-March losses

  • EUR/GBP -1.07% at 0.8764, Thurs range 0.8861-0.8758; EZ govts drag feet on EZ virus aid

GBP Chart: Click here

Refinitiv IFR Research/Market Commentary
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