Trump discloses probe into Pharmaceutical and Semiconductor imports

The Trump administration has disclosed probes into pharmaceutical and semiconductor imports. The reports by the Department of Commerce aims to determine the effects on the national security of imports of semiconductors and semiconductor manufacturing equipment (SME), and their derivative products and “the effects on the national security of imports of pharmaceuticals and pharmaceutical ingredients, including finished drug products, medical countermeasures, critical inputs such as active pharmaceutical ingredients, and key starting materials, and derivative products of those items”. Essentially, the probes may be used in the future to justify or intensify Trump’s tariffs and thus could have an impact on the US Equities market.In the US auto industry, according to the FT, President Trump stated yesterday that “I’m looking at something to help some of the car companies,” and that they “need a little bit of time”. The comments by President Trump may imply a softer tone to his tariff agenda which in turn may be perceived as a willingness to ease on his harsh tariff agenda which has severely influenced the US stock markets. In turn, a softer tone may alleviate market concerns and could thus aid the stock prices of automakers.Fed Board Governor Waller showcased his concerns over Trump’s ‘ambitious’ tariff agenda. Specifically, he implied that US economy growth would “slow to a crawl” and went on further to imply that the Fed may have to cut rates sooner.

EUR/USD appears to be moving in an upwards fashion, with the next possible target for the bulls being the 1.1470 (R1) resistance line. We opt for a bullish outlook for the pair and supporting our case is the RSI indicator below our chart which currently registers a figure near 70, implying a strong bullish market sentiment. Yet the RSI figure being above 70 may also imply that the pair is due a correction to lower ground. Nonetheless, for our bullish outlook to continue we would require a clear break above the 1.1470 (R1) resistance line with the next possible target for the bulls being the 1.1680 (R2) resistance level. On the flip side for a sideways bias we would require the pair to remain confined between the 1.1195 (S1) support level and the 1.1470 (R1) resistance line. Lastly, for a bearish outlook we would require a clear break below the 1.1195 (S1) support level with the next possible target for the bears being the 1.0960 (S2) support line.

XAU/USD appears to be moving in an upwards fashion, with gold’s price seemingly taking aim for its recently formed all-time-high figure near our 3245 (R1) resistance line. We opt for a bullish outlook for the precious metal’s price and supporting our case is the RSI indicator below our chart which currently registers a figure near 70, implying a strong bullish market sentiment. For our bullish outlook to continue we would require a break above the 3245 (R1) resistance level, with the next possible target for the bulls being the hypothetical 3380 (R2) resistance line. On the flip side for a sideways bias we would require gold’s price to remain confined between the 3115 (S1) support level and the 3245 (R1) resistance line. Lastly, for a bearish outlook we would require a break below the 3115 (S1) support level with the next possible target for the bears being the 2980 (S2) support line.

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In today’s European session, we note the release of UK’s employment data for February, Norway’s trade balance for March, France’s final HICP rate for March, Euro Zone’s industrial output for February, Germany’s ZEW indicators for April and later on New Zealand’s milk auctions. As today’s American session is about to start, we get Canada’s house starts and March’s CPI rates while from the US we get April’s New York Fed manufacturing index and later on the API weekly crude oil inventories figure, while Richmond Fed President Barkin speaks. In tomorrow’s Asian session, Fed Board Governor Cook speaks and as for financial releases we note the release of Japan’s machinery orders for February and from China we get the Urban Investment, Industrial Output, Retail Sales and GDP growth rates all being for March.