In the United Kingdom, a new draft law on the exit agreement negotiated with Brussels, already rejected three times by Westminster, will be put to the vote in Parliament in early June, but without any hope of being adopted. Negotiations between the government and the Labour opposition, aimed at finding a compromise on Brexit, have also definitively failed, with Labour stigmatizing Theresa May for her "weakness".  The Prime Minister is also being pushed out by her own party, which is asking her to leave office this summer. And while the Brexiters dominate polls in the European elections, Boris Johnson, a leading figure in a tough line among the Tories, is expected to be the big favorite for his succession. A scenario feared by the markets that sanction the Pound.

In Australia, the ruling center-right coalition (liberals/conservatives) won a surprise victory in the parliamentary elections, once again defeating the pollsters' prognoses. This is good news for AUD as the Labour Party predicted a wave of additional spending, particularly in the areas of health and education. For his part, Prime Minister Scott Morrison focused his campaign on promises of tax cuts to boost a faltering economy after 30 years of robust growth.

In Europe, attention is focused on the legislative elections to be held in the 28 EU countries from May 23 to 26. It was an opportunity for populists, led by the Italian government, to have a field day. Deputy Prime Minister Matteo Salvini is saying all over the place that he is prepared not to respect the budgetary rules of the Old Continent.

In Japan, GDP grew by +0.5% in the first quarter, far exceeding economists' expectations and contrasting with the level of household consumption.

Finally, on the trade war front, Donald Trump offered an unexpected truce to many countries, undoubtedly to devote himself better to Beijing. Thus, the American President gave Europe six months to negotiate about its car exports to the United States. Similarly, Washington announced the elimination of tariffs on steel and aluminum from Canada and Mexico. But at the same time, the White House resident is banning telecom networks from sourcing from foreign companies deemed at risk, a measure mainly targeting the Chinese company Huawei, raising fears of reprisals from the world's second largest economy.

This week, Forex traders will be watching British inflation and FED minutes on Wednesday. The new European PMI indicators will be unveiled on Thursday, shortly before the minutes of the last ECB meeting, while the European elections will polarize the interest of observers next weekend.

Graphically, the Euro continues to threaten its annual lows but we still favor positions initiated on the basis of a rebound rather than entries on support breaks. Each technical retracement of the single currency offers a serious sales opportunity, with 1.135 and then USD 1.10 in the sights.

While it had resisted British dithering over Brexit in recent months, the Pound recorded 11 consecutive drops, a record for many years. Under 1.2718, the cable should not encounter any technical obstacles up to USD 1.2515, a level not seen since January 3. However, the return of political instability to the forefront is increasing uncertainty.

The USD/JPY pair managed to hold on to 109.90, saving most of the ground despite a sharp decline in risk aversion since late April. As long as this threshold is maintained, purchases can be considered, with JPY 110.80 and 112.10 as objectives.

Finally, while the Australian Dollar briefly benefited from the Prime Minister's unexpected victory in the parliamentary elections, the currency remains penalized by the context of a trade war involving China, Canberra's main customer, and by expectations of a rate cut. Quickly filling a gap observed at the opening on Sunday, and excluding the flash crash following the last truce of the confectioners, the Aussie is operating near an area that has not been visited since January 2016. Under 0.6871, the technical elements that are favorable to it will be cruelly lacking, making the scenario of access credible.