Economic data coming up in the European session

Euro area PMI data for April on the agenda today

Biden’s capital gains tax story ended up stealing the spotlight in trading yesterday, hurting US stocks albeit with a delayed effect – took all of nearly 3 hours.

Equities were dragged significantly lower, falling by over 0.9% at the close; the S&P 500 and Dow are still hanging on to its 100-hour moving average i.e. buyers keeping the upside momentum at least into the closing stages.

The panic also reverberated to cryptos as Bitcoin falls below $50,000 for the first time since 8 March and testing its 100-day moving average – the first time since October.

US futures are breathing slightly calmer today, up slightly, but price action this week suggests that the upside momentum has stalled somewhat awaiting fresh cues.

The dollar continues to keep steadier across the board, with EUR/USD easing to be trapped in between its key hourly moving averages @ 1.1993 and 1.2029. But the 1.2000 level and the 100-day moving average @ 1.2052 are still the major ones to watch.

USD/JPY is trickling under 108.00 with USD/CAD inching back lower after having stuck around 1.2500 yesterday. There is still daily support @ 1.2476-00 to be mindful about for the latter as it treads waters around 1.2470-80 levels currently.

With economic data set to offer little (barring any major surprises), it is going to be all about the technicals risk sentiment once again before we get to the weekend.

0600 GMT – UK March retail sales data

Prior release can be found here. After a slight rebound in February, UK retail sales is expected to see a bit more of a pickup again in March. Just be mindful that the year-on-year reading is set to be a bit distorted (reflecting a big jump) due to base effect adjustments amid the dip suffered during the pandemic onset in March last year. Q2 data will hold more significance in gauging the bounce back from the UK economic reopening, so don’t expect this month’s release to offer much to pound traders to work with.

0715 GMT – France April flash manufacturing, services, composite PMI

0730 GMT – Germany April flash manufacturing, services, composite PMI

0800 GMT – Eurozone April flash manufacturing, services, composite PMI

Much like what we saw in Q1, manufacturing conditions are expected to hold up firmly while services may see some flatlining as tighter conditions are still being prolonged into Q2. That should keep overall output close to March levels but just be mindful in case we see any surprises that could give the euro a nudge or two.

0830 GMT – UK April flash manufacturing, services, composite PMI

Prior readings can be found here (services) and here (manufacturing). With the UK already starting its gradual reopening process, that should lift sentiment and activity across the board here so expect some slight improvement to March at least.

That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.

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