INTRADAY TECHNICAL ANALYSIS 26 APRIL (observation as of 06:30 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.21175 and 1.21321.

-        Support line of 1.20592 and 1.20447.

Commentary/ Reason:

  1. The euro rose 0.14% to $1.21141 on Monday, as it rallied to a new 1-1/2 month high against the dollar.

  2. The dollar continues to be undercut as the U.S. Treasury yields retreated on the day, dragging the dollar lower.

  3. The euro strength meanwhile came as Eurozone Apr Markit manufacturing PMI unexpectedly rose stronger than expectations for a decline and at the fastest pace of expansion since the data began in 2018.

  4. Improving conditions in Europe also buoyed sentiment. France said schools would reopen on Monday and domestic travel curbs in place since early April restricting people to within 10 km of their homes would end on May 3.

  5. The currencies are expected to stay to the sidelines in the early week, as the next key action for the currency will be on the Fed's meeting later this week.

  6. The Fed's next meeting ends on April 28, and while no major policy changes are expected, investors are paying close attention to any comments about the chance of scaling back monetary easing in the future. Fed Chairman Jerome Powell is likely to repeat Lagarde's message that talk of tapering is premature, which would put downward pressure on Treasury yields and cap the dollar's gains against most currencies.

EURUSD

 

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.92164 and 0.92517.

-        Support line of 0.91023 and 0.90671.

Commentary/ Reason:

  1. The dollar was lower against the Swiss franc. The pair down 0.07% on Monday to record its lowest since March 26, traded at 0.91290.

  2. The positive outlook for the dollar wobbled as Treasury yields slipped. The dollar also weakened on news of the proposal of a tax hike for high earners by the President Biden.

  3. Investors will now look to the U.S. Federal Reserve's meeting on Wednesday for new trading cues.

USDCHF

 

[GBPUSD]

Important Levels to Watch for:

-        Resistance line of 1.39494 and 1.39987.

-        Support line of 1.37899 and 1.37407.

Commentary/ Reason:

  1. The pound was higher against the U.S. dollar on Monday, lifted by buying support for the local currency.

  2. The British pound held steady at $1.39028, rose 0.20%.

  3. The pound further strengthened its position against the U.S. dollar from last Friday’s close, riding on a weakening greenback as US Treasury yields eased below 1.6%.

GBPUSD