US Open Note – Dollar remains under pressure; euro hits wall at $1.20



Quieter end to the week; Morgan Stanley releases earnings

A calmer session in the forex and stock markets is on the cards today. The US dollar index is struggling around the 91.60 level and the 50-day simple moving average (SMA), which is acting as a crucial level. Dollar/yen rebounded off the 40-day SMA and the 108.40 support, pointing marginally up today. The futures of the S&P 500, Nasdaq 100, and Dow Jones were pointing to a slightly positive open again after a new record high on Thursday. Traders are waiting to see if US treasury yields will bounce back after plummeting yesterday despite robust retail sales numbers.

The administration of Joe Biden imposed a raft of new sanctions on Thursday regarding Russian individuals and entities as an act of reprisal for alleged misconduct over the SolarWinds hack to disrupt the US election. Russia remains available to the White house offer of a summit between President Biden and President Putin. Biden has indicated that he wants a ‘stable, predictable relationship’ with Moscow.

This week was full of bank earnings, with Morgan Stanley announcing its results today before the US market open. The Company posted net revenues of $15.7 billion for the first quarter versus $9.8 billion previously, easily beating the estimates.

Euro finds wall below 1.20; aussie and kiwi pause after strong week 

The UK and the EU are focusing on the tensions in Northern Ireland and will hold a meeting in the next two weeks. Elsewhere, in Italy, the country’s debt from the coronavirus pandemic will exceed the record set from the First World War.

Euro/dollar is struggling surpass 1.2000 round number with the EU CPI data increasing 0.9% y/y in March from 0.2% before. Pound/dollar is heading up after a red start, while euro/pound is challenging the 0.8700 barrier, rising higher again.

Meanwhile, the impressive rally in commodity-dependent currencies lost some momentum, with the aussie and kiwi slipping slightly. However, the loonie is heading for some gains, while oil prices are pointing upwards with weaker momentum than the preceding days. The yellow metal posted a strong positive day on Thursday, and today is trying to overcome the $1,764/per ounce resistance.

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