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Forex News Timeline

Wednesday, April 25, 2018

The USD/CAD is trading higher in Asia, reaching back into the 1.2850 region near yesterday's highs. The US Dollar froze against the Loonie on Tuesday

US Dollar continuing to make headway against the Loonie as bond yields buoy the Greenback higher.Receding oil on evaporating market tensions and a dovish BoC are contributing to CAD weakness ahead of the BoC's Poloz.The USD/CAD is trading higher in Asia, reaching back into the 1.2850 region near yesterday's highs. The US Dollar froze against the Loonie on Tuesday after advancing for four straight days, but the upward momentum continues against the CAD as 10-year US Treasuries hit the critical 3% yield mark and oil slides on still-expanding US crude oil supply and decelerating Middle East tensions. The USD/CAD declined rapidly from March's high of 1.3125 as the USD swooned and the CAD spiked on rallying oil prices spurred on by the hope that OPEC-led efforts to clamp down on oil production were finally starting to draw down supply from the US, and Middle East tensions over Syria sent crude higher. Tensions have broken over the Middle East without an altercation between the US and Russia, and the US is still on pace to produce more oil than any other country within the next few years, and the CAD is dropping away once more as the USD gets bolstered higher by traders fearful of the US Treasury yields with the 10-year note bumping into the 3% key level. Wednesday sees a speech from the Bank of Canada's (BoC) Governor Poloz at 20:15 GMT. The BoC turned unexpectedly dovish on rate hikes last week, sending Loonie bulls scurrying and contributing to the CAD's recent weakness. Traders will be looking to Poloz's talking points to see what the BoC has in the pipe for rate hikes looking forward.USD/CAD Levels to watchThe pair is once again trading back over its 200-day SMA which sits near 1.2625, and the current run-up is getting tangled in the 50.0 Fibo level of March's decline, which could firm up into support for the pair from 1.2830, while the pair also faces stiff resistance from the 1.2900 major psychological level that kept the action capped in the last quarter of 2017.

South Korea’s Finance Minister Kim Dong-yeon was on the wires earlier today, via Reuters, noting that the government is closely watching currency mark

South Korea’s Finance Minister Kim Dong-yeon was on the wires earlier today, via Reuters, noting that the government is closely watching currency markets as the won weakens, in the wake of the recent USD appreciation. He added that the government will act to stabilize the foreign exchange market if needed.

In its global daily report, the analysts at TDS offer their outlook on the US dollar and Treasury yields over the coming weeks. Key Quotes: “While w

In its global daily report, the analysts at TDS offer their outlook on the US dollar and Treasury yields over the coming weeks.Key Quotes:“While we think that there is nothing magical about a 3% 10y Treasury, it should be a headwind for equities given that real rates continue to head higher. Focus today will be on the reception to the 5y auction. We remain medium-term USD bears but the stars are aligning for a bear-market correction over the coming weeks. There are many factors at play but mostly we suspect the rally reflects the reduction in the Trump risk premium alongside the cooling of the global growth narrative outside the US. Central banks have begun to push back as well.”

The USD/JPY is breaking higher in Asia trading, breaking over the 109.00 major handle as the US Dollar resumes its yield-fueled climb. The Greenback

Spiking Treasury yields are driving the US Dollar higher against the Yen, and the USD/JPY is climbing into fresh highs.Little data on the docket for Wednesday leaves markets exposed to broader sentiment as bond yields hit key levels.The USD/JPY is breaking higher in Asia trading, breaking over the 109.00 major handle as the US Dollar resumes its yield-fueled climb. The Greenback has been ramping up into the 109.00 area since yesterday, when the USD/JPY hit a session high of 109.20 before settling back down into the 108.55 region. Traders have been pushing the pair steadily higher since late Tuesday's bottom, and the US Dollar has punched back through the level once more after building a floor from 108.80. The Dollar is being driven higher by 10-year US Treasury yields, which have hit multi-year highs and crossed the key 3% yield mark, sending traders scurrying into the USD as equities weigh their options carefully in an environment where borrowing is becoming increasingly expensive.USD/JPY Levels to watchThe pair has turned significantly bullish on Daily candles, closing higher for five consecutive trading days and looking set to do so again for a sixth, and the USD/JPY is quickly approaching 109.70, the 50.0 Fibo retracement level of January's initial tumble from 114.75. Right behind that is the 200-day SMA sitting near 110.25, while a bearish correction will be faced with support from early April's congestion zone from 107.50 to 106.60, with further support from April's low of 105.65.

Rabobank analysts are out with a note detailing why the US Treasury yield, which has been the subject of intense focus this week, may be getting propp

Rabobank analysts are out with a note detailing why the US Treasury yield, which has been the subject of intense focus this week, may be getting propped up by knock-on structural factors rather than outright fear or market disarray.Key quotes:"After several years of serious flirtation, we finally saw the 10-year US Treasury yield go through 3.0% yesterday." " Let’s not repeat that there are plenty of structural factors leaning on borrowing costs. Oil prices, which have seen a good recent correlation with higher bond yields, also dropped back quite sharply yesterday, -2.1% from intra-day peak to the close. Of course, oil is closely tied to political developments in Washington DC, where French President Macron is visiting US President Trump." "Indeed, part of the oil sell-off, and hence briefness of the US 3% experience, was that Macron has proposed a new deal with Iran that would curb its nuclear program and ballistic missile development. Presumably this is instead of just withdrawing from the current “ridiculous, insane” deal cold, in Trump’s words. However, that optimism suggests Tehran is simply going to accept new terms offered to it - and there is no sign of that being the case. Let’s see what happens as we head towards 12 May." "The same “next week is going to be interesting” timetable is also true for China, where yesterday the Politburo warned of something: that Q1 GDP was the highpoint for the year, and things are going to get far trickier ahead. Note that even as US yields flirt with 3%, China’s 10-year yield had fallen from 4.04% in late November to just 3.50% a few days ago. In fact, China is talking about the need for fiscal stimulus, which did see a brief spike in China’s 10-year yields back to 3.60%, but the trend remains down. Given the IMF says the fiscal deficit there is already 13% of GDP, that underlines the sensitivity around the country’s economic firewall of a huge trade surplus, without which things could get ugly fast."

The resurgence of broad-based US dollar demand remained the main underlying theme in the holiday-thinned Asian session, as the 10-year Treasury yiel

The resurgence of broad-based US dollar demand remained the main underlying theme in the holiday-thinned Asian session, as the 10-year Treasury yields rally regained traction and rose above the 3 percent bulwark once again. Hence, most majors remained suppressed amid a firmer greenback, but the Antipodeans suffered the most, as persisting risk-off trades also dented the sentiment around the higher-yielding currencies. Rising Treasury yields lift the borrowing costs for the corporates, which usually weigh negatively on the global equities, including the Asian indices. Among the commodities, both crude benchmarks traded subdued amid rising US oil output while gold eased below the $ 1330 mark amid rising June Fed rate bets and receding trade war and geopolitical tensions.Main topics in Asia China's Dagong downgrades Canada's sovereign credit outlook to negative - Reuters The news is crossing the wires via Reuters that China's Dagong Global Credit Rating Co, one of the country's major ratings firms, has downgraded Canada's sovereign credit outlook to negative. Canada's Freeland: intensive NAFTA negotiations are ongoing, focusing on autos Canada's Freeland says that he has had a set of "intensive" discussions with the US' Lighthizer on NAFTA auto rules of origin, while the other areas of NAFTA negotiation are apparently wrapping up nicely. China Securities Journal: China doesn't need overly loose monetary policy - Bloomberg Bloomberg is reporting on headlines in the Chinese press, these coming from the China Securities Journal. PBOC cuts reserve requirement ratio The news is crossing the wires via LiveSquawk that People's Bank of China (PBOC) has cut the reserve requirement ratio (RRR) again. The rate cut will come into effect from today.  US 10-year treasury yield hovers around 3% in Asia The 10-year US Treasury yield is hovering around 3 percent in Asia and will likely scale the psychological barrier in a convincing manner soon.  Trump warns "bigger problems" if Iran restarts nuclear program - Xinhua News Agency US President Donald Trump warned on Tuesday that Iran will have "bigger problems" if it restarts its nuclear program, according to Xinhua News Agency.  S. Korea official: S. Korea, US expected to hold summit in mid-May - Reuters Reuters quoted a South Korean Presidential official on Wednesday, as saying that South Korea and the US are likely to hold a summit in mid-May.Key Focus aheadTraders gear up for another light session today, after the Asian trades thin volumes, with Australia and New Zealand out on Anzac Day. In Europe, the Italian markets will be closed in observance of Liberation Day while a data-empty docket will leave the fx markets at the mercy of the price-action around the US dollar and Treasury yields. Also, the sentiment on the European indices will be closely eyed, as attention now shifts towards tomorrow’s European Central Bank (ECB) monetary policy decision. The US session also remains quiet, with nothing of note in terms of the fundamentals news. However, the US EIA crude oil inventories data will remain in focus for a fresh take on the Loonie and oil prices. EUR/USD: Pennant breakdown confirmed, but multi-week range still intact The EUR/USD pair closed at 1.2208 on Monday, signaling a downside break of the bullish pennant pattern and despite the positive tone, it failed to re-enter the pattern on Tuesday.  GBP/USD clawing back into 1.40, looking for a reprieve from the sell-off The Sterling managed to catch a small lift on Tuesday after five straight days of declines against the Greenback, which started off as a broad market recovery and developed some wheels as US 10-year Treasuries built into and then crossed over the key 3% yield mark US 10-YRS @3%. WHAT’S NEXT? Investors fear that if the yield of 10-year government bonds this week will be fixed above the level of 3.0%, then a new wave of sales may start on the US stock market, which will provoke a drop on other world stock exchanges. Dollar Index remains on hunt for a break above 91.00 The dollar index, which tracks the value of the greenback against majors, is mildly bid around 90.84 in Asia and could scale the 91.00 mark in a convincing manner if the 10-year treasury yield reports big gains above 3 percent.  ECB Preview: no fireworks expected this Thursday - Barclays In the view of the Barclays Research Team, the European Central Bank (ECB) is expected to make no changes to its monetary policy meeting when it meets this Thursday.    

The EUR/JPY pair is continuing to lift as the Yen recedes in calm Asia waters, testing 133.25. The Euro has been steadily advancing against the Yen t

A quiet Yen is giving the Euro a chance to bounce up for fresh highs with market sentiment tempered.Wednesday has a quiet offering for macro data, and markets are weighing their options.The EUR/JPY pair is continuing to lift as the Yen recedes in calm Asia waters, testing 133.25. The Euro has been steadily advancing against the Yen through April after reaching a bottom of 128.95 in March. The pair went deeply bearish in February as traders piled into the Yen on market-wide fears of higher rates brought on by inflation and trade war rhetoric that ramped up for several months. The EUR has managed to stage a healthy recovery against the JPY, and has scaled back over the 200-day SMA, though February's declines are still deeply priced in. Wednesday is a quiet affair for markets on the economic calendar, and the only scheduled events for the EUR are the French Consumer Confidence index for April at 06:45 GMT, expected to remain at the previous reading of 100, and the Swiss April ZEW Survey Expectations at 08:00 GMT, last seen at 16.7. Japan saw the month-on-month All Activity Index come in exactly at expectations, printing a 0.4% after the previous showing of -1.1%, but the Yen was little disturbed in its quiet Wednesday trading.EUR/JPY Levels to watchOn the H4 charts the bullish trendline is still holding, and the new highs near 133.50 could see a small correction back into the previous swing high around the 133.00 major handle before continuing higher to challenge February's opening prices of 135.50.

Japan All Industry Activity Index (MoM) in line with forecasts (0.4%) in February

Asian stocks are reporting moderate losses on Wednesday as investors assess the impact of the rising Treasury yields.  Scorecard Japan's Nikkei in

Asian equities track US stocks lower.  Investors assess the implications of rising treasury yields.  Asian stocks are reporting moderate losses on Wednesday as investors assess the impact of the rising Treasury yields. ScorecardJapan's Nikkei index is down 0.36 percent. . Hong Kong’s Hang Seng Index has shed 0.90 percent.  Shanghai Composite is reporting a 0.30 percent drop.  South Korea’s Kospi index is down 0.90 percent.  The 10-year treasury yield is trading at 3 percent and looks set to extend the rally on inflation fears and Fed rate hike bets. A surge in the borrowing costs in the US makes the US dollar attractive especially against currencies of the nations (EMS, Asian economies) who depend on hot money inflows to plug their current account deficits.  Hence, the decline in the Asian equities should not come as surprise. Also, the overnight drop in the US stocks could be weighing over the Asian markets. The Dow Jones Industrial Average fell 1.7% on Tuesday as bell weather industrial giants Caterpillar and 3M warned on profit forecasts.  Moving forward, the stock markets may take a turn for the worst if the rally in the US 10-year yield picks up speed. 

WTI crude oil prices are walking back from three-year highs, testing back into 67.60 as US production continues to outpace demand. API Weekly Crude S

Crude falling back again as supply picks up, Middle East tensions wash out.API figures showed yet another buildup in US reserves, adding an excess million barrels in a week.WTI crude oil prices are walking back from three-year highs, testing back into 67.60 as US production continues to outpace demand. API Weekly Crude Stocks figures on Tuesday disappointed traders, showing another million-plus barrel buildup in crude supplies in the US, shattering hopes that OPEC-led cuts have been having an effect and that demand is rising fast enough to keep up with the current supply glut pouring out of the United States. Crude oil recently rallied to multi-year highs, but many traders are worried that rally was fueled mostly by recent Middle East tensions as the Syria civil war begins to drag outside observers into the political fray. Market fears over an altercation between the US and Russia over a strategic bombing of Syria in retaliation for the Syrian President Bashar al-Assad using what is believed to be chemical weapons against his own populace. With Syria fading into the background once more, crude supply outstripping demand continues to weigh down the fossil fuel, and traders are still hoping for a drying up of US activity, even as the US is on pace to become the world's single largest provider of crude within the next year or two. Further adding to the downside pressure is the likelihood of a US-France deal on Iran, which further saps strain out of the Middle East theater. On Tuesday it was reported that that the US and France are willing to reach an agreement to keep the Iranian deal on the table. The Iranian deal is an agreement which was reached in 2015 between Iran and six other countries that put limits on Iran's nuclear program in exchange for sanctions relief.WTI Levels to watchWTI Crude has been digging around the current price levels for a week now, and as FXStreet's own Flavio Tosti noted, "support is seen at 67.30 demand level and 65.42 swing low. Resistance is seen at 68.50 supply level and at 69.56 high of the year."  

The EUR/USD pair closed at 1.2208 on Monday, signaling a downside break of the bullish pennant pattern and despite the positive tone, it failed to re-

Bears on the front foot as the EUR/USD sees a downside break of the pennant pattern. The multi-week trading range of 1.2150-1.2550 is still intact. The EUR/USD pair closed at 1.2208 on Monday, signaling a downside break of the bullish pennant pattern and despite the positive tone, it failed to re-enter the pattern on Tuesday.  As of writing, the currency pair is trading at 1.2230, while the resistance of the lower end of the pennant is seen at 1.2250. The downside break of the bullish pennant pattern has weakened the bulls and boosted the odds of the bearish breakdown of the multiweek trading range of 1.2150-1.2550.  Further, the yield spread also favors the bears. Currently, the spread between the 10-year US treasury yield and the German 10-year bond yield stands at 236.8 basis points - the highest level since 1989 and could rise further as the 10-year treasury yield looks set to scale the 3 percent mark in a convincing manner.  Meanwhile, the bearish bias in the options market seems to have strengthened as well. The one-month 25 delta risk reversals show the implied volatility for EUR puts (sell EUR) is 0.375 - the highest since March 1. ECB: No fireworks expectedTraders expecting the European Central Bank (ECB) to lend a helping hand to the EUR bulls risk being disappointed as the central bank is expected to make no changes to its monetary policy meeting when it meets this Thursday and reiterate very gradual approach to removing the unconventional monetary policy measures.EUR/USD Technical LevelsA break below 1.2212 (ascending 100-day moving average) would add credence to the downside break of the pennant pattern and could yield a sell-off to 1.2150. A close lower would confirm a bullish-to-bearish trend change and allow a deeper drop below 1.20. On the higher side, a violation at 1.2216 (April 6 low) would expose resistance lined up at 1.23 (April 12 low) and 1.2307 (10-day MA). 

The GBP/USD pair is flat, but testing higher heading into Wednesday's European markets, trading near 1.3990. The Sterling managed to catch a small li

The GBP is staging a mild comeback even as the USD continues to rise on advancing Treasury yields.A clear calendar for Wednesday leaves the Sterling free to focus on Brexit and the BoE's stance ahead of the May rate call.The GBP/USD pair is flat, but testing higher heading into Wednesday's European markets, trading near 1.3990. The Sterling managed to catch a small lift on Tuesday after five straight days of declines against the Greenback, which started off as a broad market recovery and developed some wheels as US 10-year Treasuries built into and then crossed over the key 3% yield mark. The Sterling managed to dig in its heels and climb slightly from Tuesday's bottom of 1.3918, reaching a high of 1.3996 in the Wednesday overnight session. GBP/USD: data ignored, all about BoE and Brexit - Scotiabank Despite public borrowing figures missing the mark yesterday, government books have so far balanced in the fiscal year-to-date for the first time since 2002, and the GBP still managed to stage a mild recovery as traders are currently focused entirely on the Bank of England (BoE) ahead of their May rate decision, and Brexit developments as the EU and the UK continue to try and hash out a successful trade agreement ahead of the March Brexit finalization deadline. GBP/USD analysis: shy recovery not enough to confirm a temporal bottomGBP/USD Levels to watchWhile Scotiabank analysts noted that the Pound could rally into the 1.4020 area, the overall technical outlook remains soft for the GBP looking forward, and as FXStreet's Chief Analyst Valeria Bednarik noted earlier, even a modest recovery still leaves the pair deeply in bearish territory: "after the latest plunge, the GBP/USD pair is well below the 23.6% retracement of such slide, at 1.4025 and as long as below the level, chances are still to the downside. Technical indicators in the 4 hours chart have recovered from oversold territory, but remain below their mid-lines, while the 20 SMA extended its slide and its currently around 1.4000, also limiting chances of an upward extension." Support levels: 1.3960 1.3920 1.3880    Resistance levels: 1.3990 1.4025 1.4060

Reuters quoted a South Korean Presidential official on Wednesday, as saying that South Korea and the US are likely to hold a summit in mid-May. The p

Reuters quoted a South Korean Presidential official on Wednesday, as saying that South Korea and the US are likely to hold a summit in mid-May. The presidential Blue House said South Korean President Moon Jae-in and the US President Trump are also scheduled to speak by phone shortly after the inter-Korean summit ends this Friday.

Livesquawk reports that the GAC Group, a Chinese automobile maker headquartered in Guangzhou, is studying strategies to manoeuvre the impact of a US-C

Livesquawk reports that the GAC Group, a Chinese automobile maker headquartered in Guangzhou, is studying strategies to manoeuvre the impact of a US-China trade war. The company plans to enter the US still ongoing, but increased tariff would have a significant impact.

Analysts at Nomura offer a detailed preview at what to expect from April’s Bank of Japan (BoJ) monetary policy announcement after the Japanese central

Analysts at Nomura offer a detailed preview at what to expect from April’s Bank of Japan (BoJ) monetary policy announcement after the Japanese central bank concludes its 2-day policy meeting this Friday.Key Quotes:"We expect the BOJ to leave monetary policy unchanged. This will be the first meeting since the reappointment of Governor Haruhiko Kuroda and the appointment of Deputy Governors Masayoshi Amamiya and Masazumi Wakatabe. Based on remarks made by the three nominees before the Diet, we expect no immediate changes to monetary policy. In the Outlook for Economic Activity and Prices (Outlook Report), which will be released at the same time, we expect the core inflation forecasts for FY17 and FY18 to be lowered by 0.1 percentage points (pp) as we believe signs of acceleration in inflation in the run-up to the end of March were scarcer than anticipated by the BOJ. We expect the core inflation forecast for FY20 (excluding the effect of an increase in the consumption tax rate), which will appear in the forecast for the first time, to be the same as the 1.8% forecast for FY19. We expect a slightly lower GDP growth forecast for FY17 and FY18, reflecting the slowdown in growth in January-March, and FY19 to be unchanged. The first FY20 GDP growth forecast should continue to be in line with potential growth, if we assume no rise in the consumption tax rate in October 2019. We would expect a growth forecast of 0.6% if the downturn in response to the demand surge prior to the consumption tax hike is taken into consideration. At the governor's post-meeting press conference, we expect questions on the JPY80trn annual JGB purchase target, the need to continue ETF purchases, and the possibility of raising the target for long- and short-term interest rates under YCC. With the new line-up of deputy governors, we are interested - from the perspective of gauging the policy stance - to see whether or not the tone of their answers to these questions changes.”  

The news is crossing the wires via Reuters that China's Dagong Global Credit Rating Co, one of the country's major ratings firms, has downgraded Canad

The news is crossing the wires via Reuters that China's Dagong Global Credit Rating Co, one of the country's major ratings firms, has downgraded Canada's sovereign credit outlook to negative, citing a slowdown in the Canadian economy, persistently high fiscal deficit and relatively high risks in its real estate market. Dagong has kept its ratings for Canada's local and foreign currency ratings at AA+.    

US President Donald Trump warned on Tuesday that Iran will have "bigger problems" if it restarts its nuclear program, according to Xinhua News Agency.

US President Donald Trump warned on Tuesday that Iran will have "bigger problems" if it restarts its nuclear program, according to Xinhua News Agency. Key quotes"They're not going to be restarting anything. If they restart it, they're going to have big problems, bigger than they ever had before" "The JCPOA deal was "insane," "ridiculous" and "should never have been made"  

The dollar index, which tracks the value of the greenback against majors, is mildly bid around 90.84 in Asia and could scale the 91.00 mark in a convi

Dollar Index (DXY) snapped five-day winning streak on Tuesday. But, a convincing break above 91.00 is still likely as the 10-year yield is attempting gains above 3 percent. The dollar index, which tracks the value of the greenback against majors, is mildly bid around 90.84 in Asia and could scale the 91.00 mark in a convincing manner if the 10-year treasury yield reports big gains above 3 percent.  The DXY did clock a high of 91.08 yesterday, but closed on the back foot at 90.93, snapping the five-day winning streak. However, a big break above 91.00 is still on the cards as the 10-year yield is trading around 3 percent and looks north, as suggested by the bullish technical setup. Kathy Lien from BK Asset Management says the yields are being driven higher by rising in inflation and rate hike expectations. At the beginning of this month, investors saw only a 79% chance of a hike in June but those odds sit at 93% today, adds Lien. So, the American dollar looks set to extend the rally.  That said, the greenback could depreciate, especially against safe havens like the Japanese Yen and the Swiss Franc if the equities turn risk-averse in response to rising bond yields. Dollar Index Technical LevelsA break above 91.08 (previous day's high) would open the doors to 91.76 (Jan. 2 low), above which a major resistance is seen at 92.50 (Nov. 27 low). On the downside, breach of support at 90.60 (April 5 high) could yield a pullback to 90.45 (March 20 high) and 90.00 (psychological level).   

Bloomberg is out with the latest comments from the US President Trump, as he complimented the North Korean Leader Kim Jong Un as “very honorable” so f

Bloomberg is out with the latest comments from the US President Trump, as he complimented the North Korean Leader Kim Jong Un as “very honorable” so far. Trump went on to say that he hopes to hold his summit with the North Korean leader “very soon.”Key Quotes:“We’re having very good discussions. Kim Jong Un -- he really has been very open and I think very honorable from everything we’re seeing.” “I think we have a chance of doing something very special with respect to North Korea -- good for them, good for us, good for everybody.”  if Kim doesn’t agree to something “fair and reasonable and good, I will, unlike past administrations, I will leave the table.”

Analysts at Capital Economics believe that the Reserve Bank of Australia (RBA) will likely keep the Official Cash Rate (OCR) a record low of 1.50% unt

Analysts at Capital Economics believe that the Reserve Bank of Australia (RBA) will likely keep the Official Cash Rate (OCR) a record low of 1.50 percent until late-2019 amid growth and inflation concerns.Key Quotes:“Despite underlying inflation coming in slightly stronger than the Reserve Bank of Australia (RBA) expected in the first quarter, the RBA will almost certainly leave interest rates at 1.5% at its next policy meeting on Tuesday 1st May. And it may revise down its GDP growth forecasts in the following Friday's Statement on Monetary Policy (SMP). Further ahead, we anticipate that the RBA will keep rates at 1.5% until late 2019 as GDP growth and inflation remain weaker than expected.”

The Kiwi is drifting lower in the early Asia session, hitting into fresh lows at the 0.7100 handle as the US Dollar continues to walk up the charts.

The Kiwi is falling against the US Dollar as Treasury yields drive the Greenback higher.New Zealand markets are shuttered today for the Anzac holiday, and market volumes are thin.The Kiwi is drifting lower in the early Asia session, hitting into fresh lows at the 0.7100 handle as the US Dollar continues to walk up the charts. The NZD/USD has been declining steadily as the US Dollar stages a recovery in the broader markets, and the major correction is getting fueled once more by rising US Treasury yields, with the 10-year note hitting the 3% key level in the overnight session, and the Kiwi is falling back along with other risk assets against the USD. Forex today: risk turns sour, dollar pressured, yields met the 3.00% mark The New Zealand markets are dark today as the Antipodeans observe the Anzac Remembrance Day, and volumes are thin in the Asia session. Adding to Wednesday's pile is the People's Bank of China (PBOC), which cut their Reserve Requirements Ratio for a second time in two weeks as the PBOC tries to free up extra liquidity in the face of a possible economic slowdown. PBOC cuts reserve requirement ratioNZD/USD Levels to watchThe pair is turning deeply bearish, trading into four-month lows, and as FXStreet's own Ross Burland noted earlier, "technicals lean bearish after a new low was set with the RSIs biased down and with an inverted hammer on the monthly sticks. The bears can target a break of 0.7105 down to 0.7070 before 0.7030. To the upside, the 100-D SMA is located at 0.7220."  

The USD/JPY  hit a session high of 109.06 a few minutes ago and was last seen trading at 108.95.  As of writing, the 10-year yield is trading at 3 pe

USD/JPY has retraced 50 percent of the Q1 sell-off. Rising yields and the widening yield differential is dollar positive. Rising yield-led risk aversion could cap the upside. The USD/JPY  hit a session high of 109.06 a few minutes ago and was last seen trading at 108.95.  As of writing, the 10-year yield is trading at 3 percent and the spread between the 10-year US treasury yield and 10-year Japanese government bond yield stands at 294 basis points - the widest since 2007.  Hence, it is no surprise the currency pair has retraced 50 percent of the drop from 113.39 (Jan. 8 high) to 104.63 (March 26 low) and could target 110.04 (61.8 percent Fibonacci retracement of 1139.39-104.63) if the 10-year treasury yield continues to rise as suggested by bullish technical set up. That said, the USD/JPY pair may run out of steam if the equities report big losses in response to rising yields. As of now, the S&P 500 futures are trading in a sideways manner, while the MSCI Asia Pacific index is down 0.4 percent. USD/JPY Technical LevelsA daily close above 109.01 (50 percent Fibonacci retracement) would open doors for a sustained rally to 110.04 (61.8 percent Fibonacci retracement) and 110.26 (200-day moving average). On the downside, breach of support at 108.78 (session low) could yield a pullback to 108.28 (5-day moving average) and 108.00 (psychological level).   

The AUD/USD is turning lower in the Tokyo trading session, dropping into 0.7590 as the US Dollar continues to get bolstered by rising bond yields in t

Treasury yields are crossing the 3% boundary, sending the US Dollar higher.Risk assets like the Aussie are caving under the pressure once again.The AUD/USD is turning lower in the Tokyo trading session, dropping into 0.7590 as the US Dollar continues to get bolstered by rising bond yields in the US, with 10-year Treasuries cracking the 3% key level in the overnight session. US 10-year treasury yield hovers around 3% in Asia The Aussie has a quiet Wednesday lined up with the Australian markets off for the day in observance of the Anzac Memorial Day, but the AUD is still sliding against the Greenback as the Dollar rally tries to jumpstart the rally once again. The upcoming New York session is also a data-light showing, and overall markets are focused on the Treasury yield curve, with equities sliding and the US Dollar gaining as traders fear a high-cost environment in the face of monetary policy tightening.AUD/USD Levels to watchTuesday's pullback failed to start, and bidding for the Aussie is sputtering out as the Dollar continues to advance, and the pair is close to hitting fresh four-month lows, and as FXStreet's Flavio Tosti noted, "the main trend is bearish with bulls attempting a pullback. Supports are seen at 0.7550-0.7600 swing lows and at 0.7500 cyclical low. Resistances are priced in at the 0.7642 swing low and at the 0.7728 swing high."  

In the view of the Barclays Research Team, the European Central Bank (ECB) is expected to make no changes to its monetary policy meeting when it meets

In the view of the Barclays Research Team, the European Central Bank (ECB) is expected to make no changes to its monetary policy meeting when it meets this Thursday.Key Quotes:“We do not expect a change in the ECB's monetary policy stance following its meeting next Thursday. However, we think that it will need to recognize that the activity data releases have weakened, the geopolitical risks remain elevated, and the March inflation data did not deliver positive surprises. For these reasons, we think the statement will probably sound slightly more cautious and the balance of risk a bit less upbeat than in March. All of these factors, in our view, will continue to support the view of a majority of governing council members of a very gradual approach to removing the unconventional monetary policy measures. We continue to expect a short tapering of net asset purchases that will end the programme in December. The ECB would pause for roughly six months and in June 2019 would deliver a DFR hike of +15bp. Then, in Q4 19, we forecast a DFR and MRO hike of +25bp each, effectively removing negative rates by end of 2019.”  

The news is crossing the wires via LiveSquawk that People's Bank of China (PBOC) has cut the reserve requirement ratio (RRR) again. The rate cut will

The news is crossing the wires via LiveSquawk that People's Bank of China (PBOC) has cut the reserve requirement ratio (RRR) again. The rate cut will come into effect from today. The central bank last week had cut reserve requirement ratios (RRR) for most banks to release some liquidity amid signs of economic slowdown. 

As reported by Reuters, China may be unveiling new financial asset management rules, according to the China Daily newspaper. Key highlights China Da

As reported by Reuters, China may be unveiling new financial asset management rules, according to the China Daily newspaper.Key highlightsChina Daily states that China is "days away" from revealing new governing rules on the Chinese asset management industry. Traders across markets have been waiting the final release of China's new ruleset for the $15 trillion domestic asset management sector. The new rules were approved in March. The unveiling represents another step in China's Xi Jinping's crackdown on risk in the Chinese financial system. 

The People's Bank of China (PBOC) set the Yuan reference rate at 6.3066 vs previous day's fix of 6.3229. 

The People's Bank of China (PBOC) set the Yuan reference rate at 6.3066 vs previous day's fix of 6.3229. 

The 10-year US Treasury yield is hovering around 3 percent in Asia and will likely scale the psychological barrier in a convincing manner soon.  The

The US 10-year yield seeks acceptance above the 3 percent mark. 10-year Treasury-JGB spreads are widest since 2007.The 10-year US Treasury yield is hovering around 3 percent in Asia and will likely scale the psychological barrier in a convincing manner soon.  The daily chart shows a bull flag breakout, which means the yield could rise as high as 3.5 percent in the near term. Meanwhile, the weekly chart shows an inverse head-and-shoulders breakout -  a bullish reversal pattern which adds credence to the argument the 30-year bull market in bonds has ended.  The pick up in the treasury yields and the resulting widening of the yield differentials bodes well for the US dollar. For instance, the 10-year US-Japan bond yield spread stands at widest since 2007.  

Reuters reporting some key details from the Jeffry Gundlach talking points mentioned earlier. Gundlach is head of DoubleLine Capital and gave a speech

Reuters reporting some key details from the Jeffry Gundlach talking points mentioned earlier. Gundlach is head of DoubleLine Capital and gave a speech at a private event for DoubleLine Capital clients.Key quotes:"Gundlach said the Fed's "quantitative tightening" was a factor in rising Treasury yields. The uptrend in yields will continue as foreigners will be averse to purchasing U.S. bonds because of hedging costs, he said." ""The Fed is not going to bail out the market - unless there is a big problem," he said. "The stock market peaked the last day of Janet Yellen's tenure, as Federal Reserve chairperson, literally," Gundlach said."Highlights from earlierCore CPI, NY Fed underlying inflation gauge both suggest that US inflation will go higher. Gold has broken a major downward trendline, like something big is happening. Gundlach isn't sure if the US Treasury yield curve will invert or not. But says that yields on an uptrend. Some indicators "suggest" 3% inflation. Gundlach is confident that the Fed's Jerome Powell is not going to bail out the markets.

USD/JPY has popped higher in the Tokyo open with eyes for the 109 handle where NY traders took the pair to reach as high as 109.19.  Currently, USD/JP

USD/JPY: bulls stay in charge, 109 handle on the cards in thin trade?USD/JPY: US yields rallied to 3.00% and the dollar onto the 91 handle, time for consolidation?USD/JPY has popped higher in the Tokyo open with eyes for the 109 handle where NY traders took the pair to reach as high as 109.19.  Currently, USD/JPY is trading at 108.93, up 0.10% on the day, having posted a daily high at 108.97 and low at 108.79. Forex today: risk turns sour, dollar pressured, yields met the 3.00% markThe pair has been lifted with traders figuring that there could be as many as four hikes from the Fed in 2018. The yield advantage is supporting the bid while geopolitical concerns have been put on the back burner in recent sessions.  However, there were some contradicting wires crossing over the Iran deal overnight while Trump was hosting Macron in Washington. In the presser, however, the presser was more positive and helped to calm down the angst. Stocks were a weight but a late correction prevented further slippage on the 108 handle. 108.54 was the session low and the pair closed at 108.81. Wall Street stocks down close to 2-weeks’ low as 10-year yields reach the 3.00% levelFunda wrap: Trump on NAFTA, Iran and China, dollar hits 91 handle, 10yrs 3%USD/JPY levelsUSD/JPY bulls continue to dance the 100-D SMA finding support for the extended 25th March and 2nd April support line. Valeria Bednarik, chief analyst at FXStreet noted that the retracement put an end to a four-day winning streak and that the 4 hours chart shows that, while the price is far above bullish moving averages, technical indicators have begun correcting extreme overbought conditions, not enough to confirm a steeper slide ahead, but surely leaning the scale to the downside.

The EUR/USD one-month 25 delta risk reversals (XAU1MRR) fell to -0.375 today - the lowest level since March 1, indicating an increase in the implied v

Risk reversals show increased demand for the EUR puts (bearish bets)The EUR/USD one-month 25 delta risk reversals (XAU1MRR) fell to -0.375 today - the lowest level since March 1, indicating an increase in the implied volatility premium for the EUR puts.  The risk reversals had turned positive on April 17, meaning the implied volatility for EUR calls (bullish bets) was more than that of puts. However, the sharp decline from 1.2397 (April 17 high) to 1.2182 (previous day's low) seems to have revived interest in the EUR put options.  The drop in the risk reversals also indicates the investors see the potential for a further sell-off in the EUR/USD. As of writing, the spot is trading at 1.228. The risk reversals may slide further if the spot finds acceptance below the ascending (bullish biased) 100-day moving average support of 1.2212.EUR1MRR

Analysts at Nomura offered their model's projection for today's fix in USD/CNY. Key Quotes: "Our model1 projects the fix to be 186 pips lower than t

Analysts at Nomura offered their model's projection for today's fix in USD/CNY.Key Quotes:"Our model1 projects the fix to be 186 pips lower than the previous fix (6.3043 from 6.3229) and 49 pips lower than the previous official spot USD/CNY close of 6.3092. The basket implied change is 58 pips lower than the previous official spot USD/CNY close (6.3034 from 6.3092)."

The AUD/NZD pair is lifting back into yesterday's highs near 1.0690 after spiking higher in Tuesday's Asia session. The Aussie managed to gather some

Mixed CPI data for the Aussie sent the pair higher anyway, but bullish momentum is beginning to look stretched.The bull move could form a convenient bearish continuation if key swing levels aren't broken.The AUD/NZD pair is lifting back into yesterday's highs near 1.0690 after spiking higher in Tuesday's Asia session. The Aussie managed to gather some momentum against the Kiwi on Tuesday, lifting from the day's low of 1.0624 and stopping short of the 1.07 handle. Australian CPI figures came out mixed yesterday, but the Kiwi was still short-changed on the data and bowed out against the AUD. Wednesday will see a sharp decrease in volumes, as both Australia and New Zealand markets have the day off for the Anzac Memorial Day observance, but Thursday will bring Trade Balance figures for the Kiwi at 22:45 GMT.AUD/NZD Levels to watchDespite the pair's strong downtrend that began in October of 2017, the AUD has managed to close higher against the Kiwi for eight of the last nine consecutive trading days, and the challenge for bulls right now will be to keep the momentum going long enough to punch through the last swing high on the Daily candles near 1.0795 before the pair can challenge the 200-day SMA at 1.0873, while a bearish continuation will see support from the 50.0 Fibo level at 1.0590, with further support from the current low at 1.0490.

Greg Gibbs, Founder, Analyst, & PM at Amplifying Global FX Capital Pty Ltd explained that the US economy has retained strong momentum, generally beati

Greg Gibbs, Founder, Analyst, & PM at Amplifying Global FX Capital Pty Ltd explained that the US economy has retained strong momentum, generally beating expectations, while the Eurozone economy has lost momentum and has consistently underwhelmed expectations over recent months.  Key Quotes:"The ECB said it has been monitoring strength in the EUR since January." "The evidence suggests that indeed EUR strength has contributed to weaker growth and is a problem for the ECB." "The EUR has fallen after the last four ECB meetings, as Draghi emphasised patience and warned of risks. The same appears likely this week." "It may seem distracting to consider relative economic trends and rate spreads when the USD has suffered a big picture slump in confidence, but the background noise may no longer be drowning out the economic action at the front of the stage."

The GBP/JPY is lifting in the overnight session, trading into 152.25. The pair fell into 151.70 from a session high of 152.60 in Tuesday's action as

The Sterling is being buoyed by confidence in a Brexit deal and hope for a May BoE rate hike.Little on the calendar leaves markets open to sentiment swings.The GBP/JPY is lifting in the overnight session, trading into 152.25. The pair fell into 151.70 from a session high of 152.60 in Tuesday's action as the Yen made a quick resurgence across the board as markets showed their nerves for a moment, but the pair has recovered and is making up the lost ground. The pair has traded up for two straight days as the Yen has receded across the broader market, and Sterling bulls are looking to get the pair back on the bull train after the GBP/JPY fell from an April high of 153.85. The Sterling was forced into a corrective phase last week as a wide range of macro figures missed expectations and pushed out hopes of a Bank of England rate hike in May, but overall sentiment remains high and the run of middling economic figures has been forgotten as traders focus on Brexit this week. Some headlines from out of the UK are beginning to seem a bit hopeful once more, but there is still plenty of ground to cover for the EU and the UK to reach a full trade agreement when Brexit finalizes next March. little is present on the economic calendar for Wednesday's Asia markets, and market volumes are likely to be thin with Australia shuttered for the Anzac Remembrance Day observance.GBP/JPY Levels to watchThe bullish trendline remains firmly in place for the pair, and the last bounce from the swing low at 150.70 is acting as the new floor for the GBP/JPY, and a bullish run will have to mount resistance at the last high of 153.85 in order to begin challenging three-month highs above.

Bloomberg is reporting on headlines in the Chinese press, these coming from the China Securities Journal. Key highlights China will be issuing guide

Bloomberg is reporting on headlines in the Chinese press, these coming from the China Securities Journal.Key highlightsChina will be issuing guidelines on expanding imports. China's economy does not have a big downturn risk this year, minimal headwinds. There is no need for overly-loose monetary policy. More cuts to the RRR could be forthcoming.

Commerzbank is out with an analysis note on why they think the Reserve Bank of Australia is even further out from a rate hike than most are expecting.

Commerzbank is out with an analysis note on why they think the Reserve Bank of Australia is even further out from a rate hike than most are expecting.Key highlightsInflation data unlikely to provide an argument for the RBA to hike rates any time soon. Inflation remains stuck to the lower bound of the RBA's target range again in Q1 2018. Core inflation measures only ever touch the lower bound of the 2-3% target range, hitting somewhere between 1.9 and 2%. The US-China trade war represents a significant headwind to Australian growth. Growth for several years has been driven primarily by foreign trade, not domestic consumption, specifically with China.  The RBA will mostly be spending its time trying to keep the AUD from appreciating, which would put further downward pressure on inflation.

On a day where Trump hosted Macron and wires hitting about Iran, NAFTA and trade, forex today was seeing the dollar drop back from the 91 handle in th

On a day where Trump hosted Macron and wires hitting about Iran, NAFTA and trade, forex today was seeing the dollar drop back from the 91 handle in the DXY while market's trade war angst heats up again on reports that CAT was warning of higher steel costs related to U.S. tariffs which sent stocks and the dollar lower. The DXY ranged between 90.7100-91.0760, closing around 90.70. US yields in the ten years ranged between 2.95-3.00% while the Fed funds future was pricing in just 100bp of rate hikes over the next 36 month, (62bp of that over the next 12 months). As for data,  The US housing and consumer confidence were both robust, although analysts at Nomura explained that the stronger-than-expected March new home sales with backward revisions imply greater contribution from brokers’ commissions to real GDP growth in Q1 and after rounding, however, their Q1 real GDP tracking estimate remains unchanged at 1.6% q-o-q saar. As for other currencies, EUR/USD travelled higher on short covering from a low of 1.2181 to an NY high of 1.2244 after a choppy start and moved in on the mid-February and March lows that define the 14-week range trade as risk sours and the dollar pulls back from daily highs. EUR/USD closed around 1.2245. GBP/USD also moved higher, correcting a five-day bear trend from 1.4376 double top highs, firming up towards the 1.40 handle from a European low of 1.3919 (fresh five-week low, 50% Fib of Jan-Apr (2018) rise). Cable was lifted on the new Takeda-Shire M&A bid, but concerns of a dovish outcome from the next BoE meeting anchors the pound. The BoE meeting on May 10 is now a coin toss between a hike and a hold and traders are also watching Brexit developments closely.  As for the cross, EUR/GBP was dropping back from the 0.8790 recent highs and met Monday's low on the back of the IFO data miss, ending the NY session at 0.8749. The cloud top was a barrier after USD/JPY extended the start of the week's importers lead 3rally and made a high of 109.19 before tanking with a fall-out in stocks to 108.55 the session low in NY, (below the 100-D SMA) and despite higher yields where the ten years got through 3% for the first time since 2013. The Trump-Macron presser failed to calm geopolitical angst and the yen stayed bid until late NY where a slight recovery made for a closing price of 108.81. After making a four-month low in Asia after the CPI miss, 1.9% vs 2.00% expected, AUD/USD started out in  NY around 0.7610, and was propped up by some short covering, lifting the pair to 0.7620 but higher US yields sent the dollar higher and the Aussie back below the 0.76 handle to 0.7590 but the pair managed a recovery back to 0.76 the figure for the close. Trump said there is a good chance of a trade deal with China, Tsy Sect Mnuchin to be headed there soon. Key notes from US session:Funda wrap: Trump on NAFTA, Iran and China, dollar hits 91 handle, 10yrs 3%Wall Street stocks down close to 2-weeks’ low as 10-year yields reach the 3.00% level 

Canada's Freeland says that he has had a set of "intensive" discussions with the US' Lighthizer on NAFTA auto rules of origin, while the other areas o

Canada's Freeland says that he has had a set of "intensive" discussions with the US' Lighthizer on NAFTA auto rules of origin, while the other areas of NAFTA negotiation are apparently wrapping up nicely. There are still a handful of key issues that need to be resolved besides autos, but clear specifics about what is being agreed to are still forthcoming.

Jeffrey Gundlach, the head of Doubleline Capital, spoke in New York on Tuesday about his outlook on the US economy, among other things. Key highlight

Jeffrey Gundlach, the head of Doubleline Capital, spoke in New York on Tuesday about his outlook on the US economy, among other things.Key highlightsCore CPI, NY Fed underlying inflation gauge both suggest that US inflation will go higher. Gold has broken a major downward trendline, like something big is happening. Gundlach isn't sure if the US Treasury yield curve will invert or not. But says that yields on an uptrend. Some indicators "suggest" 3% inflation. Gundlach is confident that the Fed's Jerome Powell is not going to bail out the markets.

The AUD/JPY is little-changed on the week, heading into Wednesday's session trading near 82.70. The Aussie has been unable to develop momentum in eit

Wednesday is set for a quiet Asia session with little on the docket and Australia markets closed for the holiday. Japan data is mid-tier and unlikely to drive much action, though volumes will be thin and volatility could spike. The AUD/JPY is little-changed on the week, heading into Wednesday's session trading near 82.70. The Aussie has been unable to develop momentum in either direction against the Yen this week, as markets hold steady and risk appetite remains on-balance, with the market worries over trade tensions and the US-China trade spat have both taken something of a backseat, though trade wars still represent a large threat to global growth and stability. Wednesday is going to be a quiet affair with Australia markets dark for in observance of Anzac day, while Japan will see the All Industry Activity Index, forecast at 0.4% for March, versus the previous month's -1.8% decline.AUD/JPY Levels to watchThe pair whipped in Tuesday's trading, reaching a new high for the week just above the 83.00 handle, before being sent back into the week's lows at 82.50. The pair finished off the action to recover to Tuesday's opening price, and the AUD/JPY is now trading in the middle of a rough channel from 82.80 to 82.50. A floor has been priced in on the H4 candles for a move into recent swing highs near 83.90, while a bearish continuation will have to first break below the 50.0 Fibo level giving support from 82.45 before challenging the bottom at April's low of 80.80.

Analysts at Scotiabank noted that cable is steadier and intraday patterns do suggest a minor low developing around 1.3920 overnight. Key Quotes: "Th

Analysts at Scotiabank noted that cable is steadier and intraday patterns do suggest a minor low developing around 1.3920 overnight.Key Quotes:"The GBP sell-off is perhaps due a modest recovery possibly towards the 1.4010/20 area." "However, the broader technical picture suggests the GBP is liable to remain soft and may still head for a test of the mid/upper 1.37s after last week’s tumble from the upper 1.43s."

Analysts at Nomura reviewed the key US data from overnight and updated their GDP tracker. Key Quotes: "Case-Shiller home price index:  The 20-city

Analysts at Nomura reviewed the key US data from overnight and updated their GDP tracker.Key Quotes:"Case-Shiller home price index:  The 20-city composite Case-Shiller home price index increased 6.8% y-o-y in February, above expectations (Consensus: 6.35%). Cities in the West continued to show the fastest home price appreciation, with Seattle (+12.7%), Las Vegas (+11.6%) and San Francisco (+10.1%) leading the way. The headline 6.8% reading for the 20-city composite is the highest since June 2014. Steady demand in a strong economy combined with continued low inventory will likely bolster home price appreciation over the near term. New home sales:  New home sales rose solidly by 4.0% m-o-m in March to an annualized 694k, above expectations (Nomura: 620k, Consensus: 630k), with upward revisions to January and February sales. Strong March data and the upward revisions point to better-than-expected sales activity in Q1. Solid gains in new home sales appear consistent with households that have remained confident about their near-term economic outlook throughout Q1. However, deteriorating home affordability could hurt demand by making it more difficult for first-time home buyers to enter the market. Conference Board’s consumer confidence:  Conference Board’s consumer confidence index increased 1.7 index points to 128.7 in April, above expectations (Nomura: 124.3, Consensus: 126.0). This report stands in contrast to the University of Michigan’s preliminary April consumer survey where concerns about escalating trade tensions dampened overall confidence. Moreover, the Conference Board report indicates that consumers’ optimistic outlook on the economy in light of steady job and income growth may have outweighed trade concerns. The labor differential index (the difference between those reporting jobs “plentiful” versus “hard to get”) declined slightly to 22.9 from 23.8 but remained near multi-year highs, a good sign for the April BLS employment report. We think the elevated confidence provides further reason to expect consumer spending to pick up this year despite a somewhat weaker-than-expected Q1. GDP tracking update:  Stronger-than-expected March new home sales with backward revisions imply greater contribution from brokers’ commissions to real GDP growth in Q1. After rounding, however, our Q1 real GDP tracking estimate remains unchanged at 1.6% q-o-q saar."

The S&P 500 Index dropped 1.30% to 2,634.56. The Dow Jones Industrial Average dropped 424.56 points or 1.74% and closed at 24,024.13. The Nasdaq compo

Stellar earnings are not impressing investors who wonder if the earnings can be sustained over time. Higher yields, rising interest rates and commodities weigh on companies.The S&P 500 Index dropped 1.30% to 2,634.56. The Dow Jones Industrial Average dropped 424.56 points or 1.74% and closed at 24,024.13. The Nasdaq composite declined 1.70% to 7007.35 as, Alphabet, Netflix, Amazon and Facebook dropped more than 4 %. Caterpillar saw its earnings beat analysts expectations and the stock traded higher at the start of the day. However, Caterpillar CFO In a conference-call said that the first quarter would be the "the high watermark for the year," and the stock tanked 6.8% on the day. Caterpillar stock has a 0.81% correlation with the Dow Jones and therefore the company is seen as a barometer for the health of the economy as a whole.  Meanwhile, 3M reported its quarterly earnings but lowered its full-year profit forecast and the stock plummeted 6.86% on the day. Alphabet, Google parent company also beat expectations but the stock fell 5%. Companies are reporting stellar earnings but stocks get dumped. The reason is that earnings reflect the company’s statistics in the past. Most companies, however, got a boost from tax cuts but eventually, the effect will subside over the coming months and the market is factoring that in. The market can see the earnings go higher in 2018 but 2019 seem far-fetched for some market participants.  Additionally, higher rates and commodity prices are starting to weigh on companies which see their input costs rising. The 10-year Treasury yields reached 3.003% on Tuesday which is its highest point since 2014. The bull run in yield is driven by the expectation that the Federal Reserve Bank will raise interest rates three to four times this year; along with the fiscal policy boost.  "Investors have high expectations for earnings. At the same time, a lot of people are asking: Does it get better from here? I think that's why we're seeing such shifts in the market," said Kate Warne, investment strategist at Edward Jones.S&P 500 Index daily chart
Immediate support is seen at 2,600 demand level and 2,551.75 cyclical low. Resistance is seen at 2,718.75 and 2,800 swing high. 
 

South Korea Consumer Sentiment Index declined to 107 in April from previous 108.1