Daily Market Outlook, April 20, 2023

Another whipsaw session on Wall Street, albeit with recent ranges which are continuing to contract on low volume price action, notably the VIX, the fear gauge for investors printed lows not seen since 2021, suggesting investors risk appetite remains optimistic, the directionless action on Wall Street has seen Asian equities follow suit overnight, with most indices trading with modest gains, better than expected export data out of Japan supported the Nikkei, while the HangSeng and Shanghai Comp are mixed with the mainland index lagging the offshore counterpart as the PBOC did little to inspire investor risk sentiment maintaining benchmark lending rates for the eighth month in a row.

The data docket for the European session is scant with no tier one releases from the UK or the Eurozone. Stateside the US data slate has a couple of releases of note, existing home sales and the Philadelphia Fed manufacturing survey. Initial jobless claims will also be eyed for indications of the impact of the tech and financial services layoffs now starting to show up in the data, this week’s release coincides with the survey period for this month’s Non Farm Payrolls assessment.

Investors’ attention today will likely be drawn to a bevy of central bank speakers. The Bank of England’s Tenreyro kicks things off delivering remarks as a panellist at a conference on the return of inflation. Tenreyro is a widely known dovish MPC member who dissented against the latest interest rate increase at the BoE. From the ECB remarks from President Lagarde and Executive Board member Schnabel will be parsed, as investors assess the extent the ECB will likely raise interest rates at its May policy meeting. The minutes of the ECB’s March policy meeting will also be released, note this meeting saw the ECB raise rates by 50bps in the shadow of the banking crisis. US Fed members Mester, Bostic and Harker are set to speak about the economic outlook later this afternoon, Mester has been vocal that any interest rate cut this year would be ‘bad policy’, this view is in direct opposition to markets which are pricing rate cuts at the back end of 2023.

FX Options Expiries For 10am New York Cut 

(In bold represent larger expiries, more magnetic when trading within daily ATR)

  • EUR/USD: 1.0925 (1.8BLN), 1.0975-80 (800M), 1.1000 (1.1BLN)

  • 1.1050-60 (1BLN)

  • GBP/USD: 1.2350 (864M), 1.2470-80 (240M)

  • EUR/AUD: 1.6225 (379M), 1.6400 (353M)

  • AUD/USD: 0.6695-0.6700 (1.3BLN), 0.6850 (500M)

  • AUD/NZD: 1.0650 (725M), 1.0800 (601M)

  • USD/CAD: 1.3450 (325M), 1.3475-85 (463M), 1.3510 (718M)

  • USD/JPY: 133.80-85 (475M), 134.30 (867M)

  • EUR/JPY: 142.75 (1BLN), 143.05 (400M)

Overnight News of Note

  • Futures Slightly Down, Traders Parse Corporate Earnings

  • Asian Stocks Ease, Dollar Subdue As Investors Tread Cautiously

  • Fed’s Williams Says Banking Stress Likely To Tighten Credit

  • Fed’s Goolsbee: Watching For Other ‘Credit Shoes’ To Drop

  • US Economy Stalls As Credit Narrows, Fed Beige Book Says

  • Poll: Fed To Deliver 25Bps Hike In May, On Hold Rest Of Year

  • US Economy Stalls As Credit Narrows, Fed’s Beige Book Says

  • China’s Lending Benchmarks Unchanged In Sign Of Recovery

  • Japanese Trade Gap Narrows Again As Fuel Import Costs Ease

  • RBA Review: Expert Policy Panel Needed And Fewer Meetings

  • New Zealand’s Softer Inflation Signals Rate Hikes Nearing End

  • ECB’s Schnabel Says Too Hard To Call May Meeting Outcomes

  • Musk Signals Tesla Set To Assign Sales Growth Ahead Of Profit

  • IBM Sees Modest Annual Sales Growth On Strong Second Half

(Sourced from Bloomberg, Reuters and other reliable financial news outlets)

Technical & Trade Views

SP500 Bias: Intraday Bullish Above Bearish Below 4110

  • Primary support is 4000

  • Primary objective is 4207

  • Below 3985 opens 3950

  • 20 Day VWAP bullish, 5 Day VWAP bullish

EURUSD Bias: Intraday Bullish Above Bearish below 1.09

  • Primary support  is 1.07

  • Primary objective is 1.1128

  • Below 1.0700 opens 1.0660

  • 20 Day VWAP bullish, 5 Day VWAP bearish

GBPUSD Bias: Intraday Bullish Above Bearish below 1.2300

  • Primary support  is 1.2250

  • Primary objective 1.2659

  • Below 1.22 opens 1.2010

  • 20 Day VWAP bullish, 5 Day VWAP bearish

USDJPY Bias: Intraday Bullish above Bearish Below 133.00

  • Primary resistance  is 135.15

  • Primary objective is 129.15

  • Above 136 opens 137.90

  • 20 Day VWAP bearish, 5 Day VWAP bullish

AUDUSD Bias: Intraday Bullish Above Bearish below .6696 

  • Primary support  is .6620

  • Primary objective is .6814

  • Below .6560 opens .6450

  • 20 Day VWAP bearish, 5 Day VWAP bullish

BTCUSD Intraday Bias: Bullish Above Bearish below 29100 

  • Primary support 26500

  • Primary objective is 30500

  • Below 26300 opens 25800

  • 20 Day VWAP bullish, 5 Day VWAP bearish