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- US 2 year yield tests 200 hour 200 day MA and 4%
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- BOE Bailey: If persistent inflation appears, further tightening would be required
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- European equity close: Strong start to the week
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- Dallas Fed March manufacturing index -15.7 vs -13.5 prior
- ECB's Centeno: We haven't seen a deanchoring of inflation expectations
- The CHF is the strongest and the JPY is the weakest as the NA session begins
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A quiet Monday on the data front, looked for clues from the banking sector. The turmoil of last week was replaced with a relative calm. First Citizens Bancshare purchased some of Silicone Valley Bank's mortgage assets. That helped to push up the shares of First Republic and other regional banks. FRC shares rose $1.46 or 11.81% at $13.82. The regional bank index gained $0.38 or 0.87% to $13.82. Financials were one of the stronger S&P components rising by 1.4%. Energy and industrials were also supported with energy surging by 2.10% and industrials up 0.82%.
Overall the Dow led gains today with a rise of 194.55 or 0.60%, but was up as high as 326.46 at the high. The S&P also closed higher but only by 6.56 points ro 0.17%. It traded up as much as 32.85 points.The Nasdaq was under pressure as some of the big cap tech stocks, which have been safe havens of late, saw share prices move lower. Microsoft moved lower by -1.49%, Apple, fell by -1.25% and Nvidia fell -0.93%.
The US debt market also helped to contribute to the falling stocks. A snapshot of the market shows:
- 2 year yield up 24.4 basis points to 4.0205%. The yield is also moving back above its 200 day moving average and 200 hour moving average. Both are near 4%
- 5year yield rose 19.9 basis points to 3.606%
- 10 year yield rose 16.5 basis points to 3.543%
- 30 year yield rose 12.6 basis points to 3.770%
In the forex, the CAD was the strongest of the majors, while the JPY was the weakest. The USD was mostly lower with declines of -0.65% vs the CAD, -0.49% vs the GBP and -0.45% declines vs the CHF.
Looking at the USDJPY, the pair moved up steadily in the Asia-Pacific session and into the US session. That move took the price back above its 100 hour moving average currently at 131.296. However the 200 hour moving average at 131.831 remains a topside hurdle. The high price today reached about eight pips short of that level at 131.752.
The EURUSD is making new highs coming into the close near 1.0800. The 100 hour moving average of 1.08063 remains a topside hurdle to get to and through. A move above would increase the bullish bias
The USDCAD fell below its converts 100 and 200 hour moving averages near 1.3714 early in the North American session, and continue to trend lower through the day. The price is trading at 1.3657 heading into the last few minutes of trading for the day. The low price reached 1.36485. There is a key swing area between 1.3650 and 1.3665. Although the price dipped below it briefly, there has been some modest buying near the low of the swing area.
The USDCHF test it's 100 hour moving average above during the early European session and found willing sellers. The price moved lower into the New York session and more sideways but maintained its bearish bias. The low price reached the glow from yesterday at 0.91545 and found some support buyers against that level. A move below that level in the new trading day would increase the bearish bias.
