A dull day is expected with both the Easter break and the end of the Third Qtr now closing in on us. So dealers will be lightening positions in anticipation of the four-day break.

Adding to this will be the fact that the US in its infinite wisdom, has decided to release the Non-Farm Payroll data on Good Friday (??!!) even in the good ol’US of A; this is a remarkable decision as, with no markets open (apart from a few futures exchanges), the potential for disorderly market conditions when the NYSE does reopen is greatly increased.

The FTSE is back up at the highs and is having another pop at 5735/40. Traders were keen to sell at these levels yesterday and I see no reason why they will not react in the same manner today as well. 5640/60 had a similar effect earlier this month, with traders continually selling the range and buying back at 5600. The art in trading resistance levels is to make sure that you do not get ‘carried out’ by a break in either direction.

At 09.30 London time we will get confirmation of the GDP numbers for the final Qtr of 2009, and we do not expect any real fireworks from these. Even if there are some alterations, it will be pretty academic anyway as they appertain to conditions of 3 to 6 months ago. We expect confirmation of 0.3 pc for the qtr and minus 3.3 pc for the year.

With markets continuing to hit (or at least trade close to) recent highs, it is difficult to consider any bearish strategy, but we must also be careful of getting too over confident in some arenas. With much of the West still printing money, as if it did indeed grow on trees, the absolute value of many of our assets has been diluted as the value of the currencies in which they are priced drifts ever lower. Eventually, of course, everything evens out, but sometimes it takes years for the kinks to be straightened. From a UK point of view, the FTSE is now just 15pc from the all time highs of back in 2007, but from a Euro (World) point of view, the FTSE is still 35pc from the highs(!) over the same time period. As much of the FTSE 100’s core business is non-UK based, this might indicate that either the Euro must fall versus the pound or that the FTSE must rally considerably more.

The currency markets are continuing the dollar reversal of yesterday, with 1.3500 versus the Euro and 1.5010/15 versus the Pound having been overcome in early action. Clients have been buyers of the pound for some time and seem to be riding the rally higher. There is resistance at 1.5055/60 and up at 1.5110, but in truth we seem to be stuck overall in the wider range of 1.48/49 to 1.53/1.5350 range and it is quite difficult to see what is going to break us out of here.

Eur/Yen has managed to break above the 125.00/125.25 resistance level, which has held it back for a couple of months, but there does appear to be very little in the way of follow through just at the moment. Failures at this level have triggered strong reverse moves in the past, so traders who concentrate on this cross pair will be nervous of getting too heavily involved just yet. A close tonight above 125.25 may well bring out more bull sentiment, but at the moment we are seeing quite a bit of two-way trade as bulls and bears appear equally matched.

Gold failed to get through the 1112/14 resistance mentioned yesterday, but the pull-back was hardly exciting either. Today we are close to the highs again at 1111.5, but our clients remain very confident of higher prices with buying across the board in precious metals.

Oil is also at the highs with 82.50/83 still barring the way to higher prices. The pressure over the last few weeks has all been to the upside and our clients (as with gold) seem to be bulls to a man. We must hope that there is a break higher soon, as otherwise the repeated failures to make it into new territory will swing the probability pendulum back in the bears’ favour. Traders will be watching the $83 resistance levels, but on the downside there is not much until we get to 80 bucks, which has started to be built up as a small support level.