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The markets opened with a renewed carry-trade appetite as the Bank of Japan doubled down on Bond buying. Early Thursday, the BoJ maintained rates unchanged at -0.10% despite rising inflation indicators. Central banks continue to battle with rising inflation amidst war clouds. ECB members McCaul and Elderson will be speaking later in the New York session ahead of the Friday inflation data.
USDJPY soared by +1.76% hitting a fresh 20-year peak as BOJ maintains a neutral policy stance. The pair broke a 129.43 near-term resistance reaching a 130.00 high. The Fed’s hawkish sentiments continue to boost dollar strength in the near term. Bulls may target the 135.00 as room for upside gains widens. Traders should pay attention to US GDP data and labour market statistics
EURJPY extended gains by +1.46% as markets found near-term support at 134.81. Bulls face a near-term barrier at 140.00 and a break above that area may see upside gains targeting 149.00 high. However, a break below the 138.00 psychological barriers may cause selling pressure in the medium term. ECB’s policy direction will be a key factor in influencing the direction of the EURJPY pair. Investors shift focus to ECB members’ speeches ahead of Friday’s Inflation data reports.
NZDJPY surged by +1.45% early European session ahead of the New Zealand Trade balance data Friday morning. The pair is boosted by weakness in the Japanese yen and bulls have a near-term barrier at 85.500. The policy divergence between the RBNZ and BoJ continues to promote carry trades. A break above the 85.500 resistance may open room for further upside towards the 87.00 near-term high.
European stocks opened higher on Thursday with the DAX index leading, with a 2-day rise from a 7-week low at 13565.93. The Index rose +1.37% and has the potential to trade higher towards 14500 although the outlook remains bearish in the near term. The CAC40 soared by +1.49% as bulls attempted to reclaim the 6600.00 near-term high. A breach above that area may push the price towards a 6700 high and a failure to challenge that near-term high may renew sellers’ interest towards a 6400.00 low. FTSE added gains by +0.32% early European session as bulls traded towards the 7500.0 near-term resistance.
US Equities futures rallied early in the European session as the corporate earnings season inspires optimism among investors. The S&P500 futures were up by +0.91% extending gains above 4200 and investors are facing a 4300 near-term barrier. A failure to break above that immediate high may cause selling pressure towards the 4100 low. Nasdaq futures soared +1.10% as tech giant Meta Platforms’ Q1 earnings beat expectations by far. The Dow Jones Industrial index trimmed early morning gains after sweeping off 33700, which coincides with Wednesday’s high. There remains upside potential towards the 34000.00 area.
USWTI futures rose by +0.34%as bulls continue to defend the 100/dollar per barrier near-term psychological support. Brent oil was up by +0.44% as bulls aim for a 112.00 near-term high.
US 10-year yields were trading lower as investors focused on corporate earnings in the near term. The yield curve broke below 2.83% as sellers may target 2.62% losing -0.90% to the downside.
