The JPY remained at low levels against the USD on Friday as the market’s risk appetite seems to be turning on. Recent signs of the Chinese economy stabilising seem to have caused some outflows from the JPY. It should be noted that the US-Sino negotiations may have marked some further progress, as media report that the US may be cooling their original position for Beijing curbing its subsidies for Chinese businesses. Also an optimistic start of the US earnings seasons may have motivated investors to abandon the safe haven. Analysts point out that we are probably seeing a classical risk on market at the current stage. Please bear in mind that the positive mood may have lowered concerns for the upcoming US-Japanese negotiations about trade. USD/JPY rose and stabilized on Friday, testing the 112.00 (R1) resistance line. We could see the pair trading in a bullish mood, should the risk on mood be renewed and the financial releases could support the USD side of the pair. Should USD/JPY trade in a bullish market we could see it breaking the 112.00 (R1) resistance line and aim for the 112.50 (R2) resistance level. Should on the other hand the pair’s direction be dictated by the bears, we could see it dropping and breaking the 111.40 (S1) support line.

WTI prices stabilize.

WTI prices maintained their sideways motion on Friday, as conflicting fundamentals continued to push the commodity on both sides. Analysts seem also to be pointing towards a relatively tight band, due to mixed supply signals stemming from the US and OPEC with its allies. It should be noted that Libya’s national oil corporation warned on Friday that renewed fighting could wipe out crude production in the country. Also Russian finance minister Siluanov, was quoted saying that Russia and OPEC may decide to increase production to fight the US for their market share in the oil market. We could see the commodity trying to make up its mind this week and black gold prices could show further sensitivity to headlines regarding its supply and/or demand. WTI prices seem to be constantly teasing the 63.80 (R1) support line (now turned to resistance). We could see the commodity maintaining a tight range of prices as it decides the direction of its next leg. Technically as the upward trendline remains intact, we tend to see the risks relating to the oil prices tilted to the upside. Should the commodity come under the selling interest of the market, we could see its prices, breaking the prementioned upward trendline and aim if not break the 62.00 (S1) support line. Should on the other hand, black gold long positions be favoured by the market we could see it breaking the 63.80 (R1) resistance line and aim for the 65.30 (R2) resistance barrier.

Other economic highlights, today and early tomorrow

In today’s American session, from the US we get the NY Fed Mfg Index for April, and during tomorrow’s Asian session RBA’s last meeting minutes are to be released.

As for the rest of the week

On Tuesday, UK’s employment data for February, Germany’s ZEW economic sentiment for April and the US industrial production for March are to be released. On a busy Wednesday, we get New Zealand’s CPI rate for Q1, Japan’s trade balance for March, China’s GDP for Q1 and industrial production for March, UK’s inflation data for March, Canada’s inflation data for March and Trade balance for February. On Thursday, Australia’s employment data for March, a number of preliminary PMIs for April affecting the EUR, UK’s retail sales for March, US retail sales for March, the US Philly Fed Business climate for April and Canada’s retail sales for February are due out. On Friday, we get Japan’s inflation rates for March.

USD/JPY H4

• Support: 111.40 (S1), 110.90 (S2), 110.30 (S3)
•Resistance: 112.00 (R1), 112.50 (R2), 113.20 (R3)

WTI H4

• Support: 62.00 (S1), 60.85 (S2), 59.00 (S3)
•Resistance: 63.80 (R1), 65.30 (R2), 66.50 (R3)