Markets were very solid yesterday, with very small trading ranges, and this week has rather confirmed our comment of Tuesday that much of this week would be quiet, as the four-day break starting tomorrow (coupled with the end of the 1st qtr) hove’s into view.

On the plus side, we have ended the 1st qtr pretty much near the highs and there is likely to be the usual ‘new money’ allocation to equities, which has as good a chance of any of pushing us higher once more.

Position holders must also beware of the fact that the major data release for the month out of the US (the Non-Farm Payroll number) is being announced tomorrow, which is either a bank holiday or is after the official market close for most of the planet. This should focus minds on the risks in holding risky positions over the Easter break, and while we will be open and quoting prices in a wide array of markets over the data release at 13.30 tomorrow, this does not detract from the fact that in very light liquidity conditions prices may well be very volatile indeed.

The FTSE had another attempt at our support at 5650/60 yesterday, but without success, and readers of this comment should have been in a good position to take advantage of the subsequent bounce to the current price of 5705. The resistance at 5735/40 will be the target for the bulls, but more than this is difficult to see. It would be a brave man who could confidently predict that the same trading range that has dominated the last two weeks will be broken in the session just before a long break.

The Dow remains welded to the 10900 level, and dealers seem in two minds as to the chances of an attempt at 11000 (which given the bull run so far seems the more probable at this time) versus a failure in confidence, taking us back down to the volume area around 10400-10600. We have now spent seven sessions in a range of not much more than 100 point (10840-10940), which for the Dow is remarkable indeed at some point there will be a break out, but it is hard to anticipate which way.

Currency markets broke out of the trading ranges mentioned in yesterday’s comments and immediately put on spurts through to new levels. Cable breaking above 1.5110/15 gave buyers the confidence to get involved again and we now find ourselves at 1.5220, which is rather a no-mans land area, generally traded on the way to somewhere else. We have some small resistance at 1.5240/45, but this is not a particularly strong one. Bulls will be eying 1.5310, but the theme of the day appears to be very much ‘bear squeeze’ time, as the Sterling Shorts set up across the globe come in for some pressure.

The Euro is rather failing to follow the pound up versus the dollar and the Yen is still positively shy in comparison. While the Euro did manage to get to 1.3560 in early trade this morning, this has now been given up and we have slumped back to key 1.35 level. Clients are buying into the Euro as I write, and there seems to be some confidence that the low this morning at 1.3475 will be the support.

Oil has broken above 84 bucks (finally) in early trade, as stops appeared to be taken out in the futures markets as traders hunted down weak shorts. Crude is now at its highest since September ’08 and we can expect higher prices on the forecourts yet again. The breaking effect of higher energy costs has not been factored in very much to growth prospects, but the implication for European and US growth are not exactly wonderful. On top of weakened bank lending capacity, higher personal taxation and impending public sector spending cuts, we now also have Oil climbing inexorably higher. The UK is very dependent on the mobility of its workforce and commercial fleets, and every squeeze on the price of delivering this will impact growth further down the line.

The 82/84 dollar resistance on Oil has stood for quite some time and if the break is confirmed in coming session, there may be something of a scramble for commercial consumers to cover their forward risks (airlines, haulage etc), it is not beyond possibility that we may see an acceleration higher in the short term. This said, inventories are still good and we may just be looking at a very attractive level to short!

Gold broke above the 1112/1114 resistance level and scooted up to 1118, before deciding to test the resistance as support (almost as a confirmation exercise). We have now failed to get back below 1112 and buyers are in evidence once more. The initial target for the bulls will be 1123/25 and then 1131/33. For shorts, the hope will be for a return and retest of 1112/14, which if it fails will tempt punters to go for 1100/1002.