Trade of The Day – EUR/USD

April 2, 2026

Facts:

  • The EUR/USD exchange rate failed to close above the 200-day EMA on yesterday’s daily candle
  • The price remains below the 50-, 100-, and 200-day exponential moving averages (EMA)

Recommendation: 

Trade: Short position on the EUR/USD pair at market price

Take Profit 1: 1.14425

Take Profit 2: 1.14115

Stop: 1.16360
 

Opinion:

From a technical perspective, the EURUSD pair remains in a structural downtrend, which is a key argument for maintaining short positions.  The price consistently remains below the 200-, 100-, and 50-day exponential moving averages (EMA), which form dynamic resistance and confirm the dominance of supply over demand in the medium term. Prices are moving within a bearish flag pattern (a trend continuation pattern), and current attempts at a rebound are being stifled by successive resistance levels marked by the downward-sloping EMAs, which technically indicates further potential for the euro-dollar exchange rate to depreciate.

An additional and significant catalyst for the dollar’s strengthening is the escalation of the armed conflict in the Middle East, directly driven by the Trump administration’s actions.  In his Wednesday address to the nation, the president announced that within the next 2–3 weeks, the United States would strike Iran “extremely hard,” promising simultaneous attacks on all Iranian power plants, which—as Trump stated—“will set the country back to the Stone Age.” The escalation of the military operation codenamed “Operation Epic Fury” is generating a classic flight-to-safety effect—primarily toward the dollar—which, combined with the euro-dollar’s technical weakness, creates a consistent environment conducive to the continuation of the downward trend in the EURUSD pair

Methodology and assumptions:
This recommendation is based on a technical analysis of the EURUSD chart. Classical technical analysis was used to assess the situation and analyze the trend. The target level—take profit 1—was set at the level of previous price reactions, using price action methodology. Take profit 2, on the other hand, is based on the location of last month’s local low. The protective stop-loss order was set above the most recent local high using price action methodology.

Currency Talk – USDJPY, NZDUSD, USDCHF

April 2, 2026

The Overbalance analysis aims to identify three financial instruments, analyzed primarily on the daily/four-hour (D1/H4) timeframe. The analysis uses only the Overbalance methodology, which helps determine where a trend may continue or where it may reverse. Today’s analysis covers three instruments, evaluated solely in terms of 1:1 correction structures.

USDJPY
Since February 12, the USDJPY has been trading in a strong uptrend. Initially, the movement was controlled by a 1:1 corrective pattern with a range of approximately 140 pips; however, in mid-March, a deeper correction occurred, after which the market established a new high. As a result, the current largest corrective pattern has a range of approximately 240 pips. At this point, the key support level is 158.10, derived from the lower boundary of this pattern. As long as this level holds, the uptrend remains in place. A break below it, however, could open the way for a larger correction or even a trend reversal.

USDJPY – H4 chart. Source: xStation

NZDUSD
The NZDUSD pair has been trending downward since late January. We are currently seeing an upward corrective move. If the correction continues, the key resistance level remains at 0.5845, where the upper boundary of the 1:1 correction pattern is located. According to the Overbalance methodology, the downtrend remains in effect until this level is negated.

NZDUSD – H4 chart. Source: xStation

USDCHF
Since early January, USDCHF has been in a downtrend. However, an upward correction has been developing since late January, and its range has already exceeded smaller geometric patterns, including the 0.7902 level. Nevertheless, the price has failed to break through the key resistance at 0.8042, where the upper boundary of the largest corrective pattern is located. According to the Overbalance methodology, the downtrend remains in effect until this level is broken. The decline could accelerate after falling below the 0.7902 level, which is the lower boundary of the smaller geometric pattern. Conversely, a break above 0.8042 could lead to a shift to an uptrend.

USDCHF – H4 timeframe. Source: xStation

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Sterling Slides as Trump’s Address Deepens Middle East Uncertainty

April 2, 2026

The British pound slipped toward $1.32, nearing its lowest point since late November, as investor caution resurfaced after President Donald Trump’s prime-time address provided no clear end in sight for the Middle East conflict. Trump affirmed that the US operation was nearly complete but vowed escalated actions, including possible strikes on electrical plants, over the next two to three weeks. The lack of new justifications for the war further weighed on market sentiment.

Ongoing uncertainty and inflationary pressures have prompted a reassessment of Bank of England policy expectations. Investors now anticipate two interest rate hikes in 2026, reversing four days of reduced bets that had left expectations below two hikes by yesterday’s close. Even so, this remains below last week’s peak, when markets briefly priced in as many as four increases. The shift comes despite Bank of England Governor Andrew Bailey’s recent warning that markets were overestimating the likelihood of hikes.

Euro Dips as Trump’s Address Fuels Middle East Uncertainty

April 2, 2026

The euro retreated toward $1.15 as investor caution returned following President Donald Trump’s prime-time address, which offered no clear timeline for resolving the Middle East conflict. While Trump stated that the US operation was nearing completion, he also vowed more aggressive measures, including possible strikes on electrical plants, over the next two to three weeks.

The absence of new justifications for the war further dampened market confidence. Amid persistent uncertainty and growing inflation fears, markets are revisiting expectations for the European Central Bank’s policy direction. Investors now foresee three interest rate hikes in 2026, an increase from the two anticipated just yesterday. Before the conflict, expectations had leaned toward no hikes at all, with some even speculating about potential monetary easing.

USD/CHF rises above 0.7950 ahead of Swiss CPI inflation data

April 2, 2026
  • USD/CHF climbs to near 0.7985 in Thursday’s early European session. 
  • Trump said the US’s war objectives are nearing completion and threatening to hit Iran hard over the next two to three weeks.
  • The Swiss March CPI inflation data will be released on Thursday.  

The USD/CHF pair jumps to around 0.7985 during the early European session on Thursday. The Greenback strengthens against the Swiss Franc (CHF) following an address to the nation by US President Donald Trump. Traders will keep an eye on the Swiss March Consumer Price Index (CPI) data, which is due later on Thursday. 

Trump said during a primetime televised speech from the White House on Thursday that his core “objectives are nearing completion” in Iran and expected another two or three weeks of involvement. Nonetheless, he signaled that the US is prepared to intensify its military response in the remaining time period and threatened to bring Iran “back to the stone ages.” Persistent tensions between the US and Iran could underpin the US Dollar (USD) in the near term.

The Swiss Federal Statistical Office will publish its inflation data on Thursday. The monthly and annual CPI are expected to show a rise of 0.5% for March. The persistent low inflation has led the Swiss National Bank (SNB) to maintain a cautious stance. 

Traders will shift their attention to the US jobs data on Friday. Markets expect the Nonfarm Payrolls (NFP) to show 60,000 in March, while the Unemployment Rate is projected to hold steady at 4.4% during the same period. If the reports show weaker-than-expected outcomes, this could undermine the USD against the CHF.

Offshore Yuan Snaps 3-Session Gains

April 2, 2026

The offshore yuan weakened to around 6.88 per dollar, ending a three-day winning streak as the greenback gained strength amid mounting uncertainties over a possible easing of the Middle East conflict. The US dollar rose as investors pared back expectations for Federal Reserve rate cuts, amid concerns that a surge in oil prices driven by the conflict could stoke rising inflation.

During his speech, Trump said the war in Iran was “very close” to completion and likely to meet its objectives in the coming weeks, while warning that military operations could intensify. Meanwhile, the PBoC drained CNY 890 billion through short-term operations and absorbed another CNY 250 billion via longer-term tools, reversing months of liquidity support after the economy’s deepest slowdown since reopening from Covid lockdowns in 2022. With growth rebounding and oil prices elevated by the Iran war, the central bank appears focused on curbing inflation while gradually steering China out of record deflation.

Rupee Falls on Outflows, Trump Speech

April 2, 2026

The Indian rupee edged down to around 93.2 per dollar, extending gains for another session amid persistent capital outflows and heightened geopolitical tensions. The currency has been under pressure from spillovers of the Iran war, prompting the Reserve Bank of India to step up measures against arbitrage and forward contract manipulation.

After an earlier crackdown on banks failed to ease volatility, corporates were barred from rebooking cancelled foreign exchange contracts, and derivative trades with related parties were restricted. Analysts noted that while these measures aim to curb speculative activity, the rupee remains vulnerable as oil prices stay elevated and capital inflows remain limited. Adding to the downward pressure, President Donald Trump’s 20-minute prime-time address said the US is “very close” to completing its military objectives in Iran, while warning of potential escalation.

AUD slips despite February Trade Surplus more than doubles

April 2, 2026
  • Australian Dollar weakens despite Trade Surplus more than doubling in February.
  • Australia’s Trade Surplus widened to AUD 5,686 million from a revised AUD 2,258 million previously.
  • President Trump signaled that the US intends to conclude the Iran conflict quickly.

AUD/USD depreciates after two days of gains, trading around 0.6900 during the Asian hours on Thursday. The pair weakens as the Australian Dollar (AUD) comes under pressure despite robust trade data, with Australia’s Trade Surplus more than doubling in February to its highest level in seven months, supported by strong gains in gold and agricultural exports, while imports of gold and data processing equipment declined.

Australia’s Trade Surplus expanded to AUD 5,686 million in February from a downwardly revised AUD 2,258 million in the previous month, significantly exceeding market expectations of an AUD 2,500 million surplus and marking the largest surplus since July 2025.

Exports increased 4.9% month-over-month (MoM) to a four-month high, rebounding from a revised 1.6% decline in the prior month. Meanwhile, imports fell 3.2% MoM to a seven-month low, reversing a revised 1.1% increase in January, reflecting softer domestic demand and ongoing uncertainty in global trade flows amid geopolitical tensions.

The AUD/USD pair also faces downside pressure as the US Dollar (USD) strengthens, even as safe-haven demand fades amid rising optimism over Middle East peace. US President Donald Trump stated on Thursday that Iran’s military capabilities have been significantly weakened, noting that its missile and drone capacity has been curtailed.

Trump added that the US no longer relies on Middle Eastern oil and emphasized that Iran’s naval and air forces have been severely diminished, with leadership losses further reducing its operational strength, while signaling that the US intends to conclude the conflict swiftly.