Daily Analyses

The analysis of HFT algorithms shows the USDJPY has likely entered consolidation mode following the wild price swings in yesterday's session on the outbreak of the Russia-Ukraine military conflict.

After yesterday's precipitous fall, today EUR/USD continues to be under pressure, developing a downward trend. At the time of publication of this article, EUR/USD is traded near 1.1170, in the zone of almost 2-year lows, below the key resistance levels 1.1575 (EMA200 on the weekly chart), 1.1535 (EMA200 on the daily chart). The targets for further decline are the local support levels 1.1000, 1.0900, between which the lower line of the descending channel on the weekly chart passes. In an alternative scenario, the first signal for buying may be a breakdown of the local resistance level 1.1230, and a confirming one – a breakdown of the important short-term resistance level 1.1303 (EMA200 on the 1-hour chart).

Events in Ukraine continue to be the focus of investors' attention, remaining the main driver of the financial market dynamics over the past few days. Investors fear that the Russian-Ukrainian conflict will accelerate inflation to new highs, while the price of a barrel of oil is hovering around $100. Europe is especially vulnerable in the current situation, given its dependence on Russian energy sources. Inflation in the Eurozone hit a record high in January, half driven by energy prices, according to the European Central Bank. The data published the day before indicated that the inflation rate at the beginning of the year is kept near the 5.1% mark. But the ECB still maintains a loose monetary policy, and also continues the quantitative easing program.

European markets awoke this morning to the shock news that Russia has started a wide attack on Ukraine. Traders are still coming to terms with the situation, and the price reaction is strong across the markets. The EURJPY, perhaps the key proxy for Ukraine-related risk aversion, is selling-off hard since early in the morning.

The activity of high frequency trading algorithms this morning indicates that the GBPUSD pair may provide trade setups from the bearish side in today's session. Namely, GBPUSD was gradually rising during the Asian session overnight, but the rally has stalled after reaching the light HFT selling pressure zone is located today at 1.3608 and above.

the GBPJPY sell-off is showing signs of stabilizing at the light HFT buying pressure zone, located today at 155.78 and below. The Russia-Ukraine situation yesterday turned risk sentiment negative, in turn pushing down on GBPJPY and the bearish move extended into today's session.

Oil prices have risen significantly over the past few weeks, staying in the bull market and trading above long-term support levels. At the time of publication of this article, Brent oil futures are traded above 96.00, remaining in the zone of multi-year highs. A breakdown of the local resistance level 96.52 (today's high) will lead to further price growth, despite the fact that oil market analysts predict that the positive dynamics of the oil market will continue against the backdrop of increased demand for energy and limited oil supplies by OPEC+ countries.

Futures on European and US stock indices fell sharply, while oil quotes rose sharply after Russian President Vladimir Putin recognized the independence of the Donetsk and Luhansk People's Republics on Monday. Officials from the White House and the European Union have already been quick to condemn Moscow's actions, calling them "a flagrant violation of international law". US President Joe Biden announced the introduction of new sanctions against Russia, while hopes for a possible summit of American and Russian leaders are finally fading. Russia is the largest exporter of energy resources, and Ukraine is the largest transit country for gas to Europe. The escalation of tension in the region and the possibility of new sanctions against Russia, given the freezing of the Nord Stream 2 gas project, could lead to an even greater increase in prices. April Brent futures ended trading up 2% on Monday, posting the strongest single-day gain since Feb. 14. Natural gas prices traded up more than 8%.

Since the beginning of this month, AUD/USD has been developing an upward correction, strengthening towards the key long-term resistance level 0.7300 (EМА200 on the daily and weekly charts). Below this resistance level, AUD/USD is in a bear market zone. An upward correction may yet send AUD/USD towards the long-term resistance level 0.7265 (EMA144 on the daily chart) after breaking through the upper limit of the descending channel on the daily chart, passing through 0.7220. However, only a breakdown of the resistance level 0.7300 can again turn the tide and bring AUD/USD into the bull market zone.