[B]�Green shoots� mania continues � Markets await �stress test� results on May 4th and outcome of GM debacle. U.S markets take well to positive Apple numbers. [/B]
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GM has announced that its June deadline for payment of it�s debt is unrealistic.Japan announces that it has revised it�s 2009 growth from 0% to -3.3% - putting the government in line with the BoJ�s previously reported -2.0% contraction in GDP. Currency markets have seen risk sentiment as the main catalyst in recent trading sessions with EURUSD trading to a low of 1.2889 then turning around � technical retracement. The Yen continues to strengthen as it becomes a preferred haven asset � even beating out the greenback in recent sessions.
[B]News and Events:
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GM has announced that its June deadline for payment of it�s debt is unrealistic � in other words � without government intervention bankruptcy filing is imminent. This doesn�t bode well with the general market sentiment as all GM creditors would feel a tight squeeze � not to mention the countless suppliers and workers that would be out of a job. Luckily the U.S Government understands this and is close to convert a $13.4Bn loan to GM into general stock, which would make the tax payer a major shareholder in the struggling auto-maker. This story continues to fuel risk adverse trades along with the perplexity that the imminent stress-test results are causing. Chrysler is also in talks with the U.S Treasury � a new deal is being drawn up between lenders and the company.
Japan announces that it has revised it�s 2009 growth from 0% to -3.3% - putting the government in line with the BoJ�s previously reported -2.0% contraction in GDP. This overshadowed the improving numbers in Trade balance. While exports and imports continue to dwindle, the rate of decline of (at least) exports seems to be leveling out. March Export numbers were largely better than those of the two previous months � exports to China topping the charts confirming what many believe will be a �RED led� recovery to the global economy.
Currency markets have seen risk sentiment as the main catalyst in recent trading sessions with EURUSD trading to a low of 1.2889 then turning around � technical retracement. The Yen continues to strengthen as it becomes a preferred haven asset � even beating out the greenback in recent sessions. Gold continues to advance. Initial Jobless claims today at 12:30 GMT.
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Today’s Key Issues (time in GMT):[/B]
12:30 USD US Jobless claims 640K vs. 610K
[B]The Risk Today: [/B]
[B]EurUsd:[/B] We are witnessing a technical retracement in the broader scheme of things. Initial resistance at 1.3052 (morning�s high) will allow for crucial pivot at 1.3115. Long term view is still bearish as the dollar continues to be the major of choice amidst these risk adverse times. Stops to be triggered at 1.2946 (61.80% fib level on March bull run) and 1.2886. Mid-term target at 1.2800.
[B]GbpUsd:[/B] Declining head and shoulders formation sees the pair test the baseline and rebound � we are capping the current retracement move at 1.4673 however see a strong sell signal at 1.4600. On the downside we see a strong support at 1.4408 for the day with intermediary stops at 1.4547 and 1.4469.
[B]UsdJpy:[/B] Pair nears and tests 50% fib level at 97.51 in past sessions. Risk aversion strengthens the Yen however continued bullish trend would need a strong push past 97.51 to target 96.57 (61.80%) then 95.97 (30th March low). On the upside the 98.45 stands as initial support (38.20%) which allows for April 16th highs of 99.61.
[B]UsdChf:[/B] Large moves continue to underline dollar strength with regards to the Swissy. Initial support at 1.1577 (38.20%) with an eye on 1.1525. Downside moves should look for a pivot at 1.1473. On the upside resistance comes in at recent crest � 1.1745, with an eye on 1.1841 as pivot.
[B]Resistance and Support:
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By[B] Philippe Meyer [/B]- ACM Advanced Currency Markets, Geneva, Switzerland