Releases from Australia:
Prior Current
Australian Q1 Retail Sales ex inflation (QoQ) - 0.2% - 0.1%
Australian March Retail Sales (MoM) +0.3% +0.5%
Mixed readings from Australia’s retail sales as March proved stronger than expected but saw the quarter as a whole slip by -0.1%. The March figures revealed a rather large drop of -2.0% in the clothing and soft good sector. In fact all sectors saw losses except for food retailing and household good retailing which rescued the figures in general.
The general downward trend is expected to continue over the year as the slowdown in the economy cause consumers to be more conservative over their household budgets.
Releases from Japan:
Prior Actual
Japan Monetary Base (YoY) 0.0% - 2.8%
Japan’s monetary base has renewed its downward trend as the BOJ reduces the amount of liquidity in order to normalize the market following the zero rate policy. Certainly with inflation making 10 year highs and further prices rises announced yesterday there is no reason for the CB to provide any additional easing with interest rates stuck at 0.5%.
While some commentators suggest there is room for a rate hike, given the soft economic environment and the fact that inflation is not domestically driven there will be little interest in following through with rate hikes for the foreseeable future.
The following economic releases are due today:
March
German Retail Sales (MoM) +0.6%
German Retail Sales (YoY) - 2.3%
French Producer Prices (MoM) +0.5%
French Producer Prices (YoY) +5.1%
U.S. Factory Orders (MoM) +0.2% April
Swiss SVME PMI 55.0
Italian Manufacturing PMI 48.8
French Manufacturing PMI 51.5
German Manufacturing PMI 53.6
Euro-zone Manufacturing PMI 50.8
U.K. Construction PMI 47.0
U.S. Change in Non-Farm Payrolls - 78K
U.S. Unemployment Rate 5.2%
U.S. Change in Manufacturing Payrolls - 35K
I don’t know whether to feel good or bad this morning. The medium term Dollar bullish view is coming along nicely but that deep pullback fooled me into looking for a little more of a correction before seeing the move we did following yesterday’s numbers.
There are a few inconsistencies across the charts today. Basically the Dollar looks close to a MT high now and should push through later today, possibly into Monday, towards the 1.5340 Euro area, I think the 1.0601 Swissie are while Dollar-Yen could well be on a more direct track for 106.18 minimum and I’m beginning to fancy the ideal 106.82 directly. What have turned up are inconsistencies in the Aussie and Pound. That latter especially is frustrating with its swings that just don’t follow-through. Unless this reverses lower quickly I suspect we’ll actually see renewed upward pressure above 1.9997-2.0025. However, overall it remains in a correction so I don’t expect any excessive rallies at the moment. Ideally I’d prefer to see it take a quick visit to retest 1.9335-60 but this needs to occur quickly or any potential bearish wave structure begins to break down. The Aussie is also at this stage. I’d prefer a move down to the 0.9290 level and then 0.9204-20. Unless this occurs quickly then we may face a stronger attempt higher that should move to new highs. And finally on Euro-Yen, yesterday’s losses didn’t quite reach the 160.20 target. I still feel there is one more dip to go but again the move is currently losing momentum and a correction higher is more likely if we don’t see the 162.05-25 area cap.
Note important support and resistance areas:
USDJPY EURUSD USDCHF GBPUSD
Res: 105.83-18 1.5642-73 1.0568-01 1.9964-97
Res: 104.86-35 1.5495-30 1.0485-07 1.9810-40 Spt: 103.75-15 1.5429-45 1.0447-64 1.9711-45
Spt: 103.20-25 1.5340-60 1.0378-05 1.9600-22 | 
