POWER: French April Power to Fall on Warmer Weather

• RES 4: $34.903 - High Oct 23 and the bull trigger  
• RES 3: $33.450 - 76.4% of the Oct 23 - Dec 19 ‘24 bear leg
• RES 2: $33.000 - Round number resistance   
• RES 1: $32.552 - 61.8% of the Oct 23 - Dec 19 ‘24 bear leg                                 
• PRICE: $32.361 @ 08:15 GMT Feb 5   
• SUP 1: $30.651 - 50-day EMA        
• SUP 2: $29.704 - Low Jan 27 
• SUP 3: $28.748 - Low Dec 19 and bear trigger
• SUP 4: $28.446 - 76.4% retracement of the Aug 8 - Oct 23 bull cycle 

Silver is trading higher this week. Key resistance at $32.338, the Dec 12 high, has been pierced. Clearance of this level would highlight a stronger reversal. This would cancel a recent bearish theme and open $32.552, a Fibonacci retracement. Clearance of this level would expose the $33.00 handle. On the downside, initial firm support lies at $30.651, the 50-day EMA and a pivot level. A clear break of the EMA would reinstate the recent bearish theme.

• MNI: SPAIN JAN SRVCS PMI 54.9 (FCAST 56.8); DEC 57.3

ECB Vice President de Guindos' interview with Hospodárske Noviny did not bring any market moving insights. He re-iterated the ECB's core guidance that "if inflation moves according to our projections, the path of our monetary policy is clear", but that policy will still be decided "meeting by meeting, based on the incoming economic data".

• Ahead of Friday's ECB staff paper on neutral rates, de Guindos played down the usefulness of the concept: "The neutral rate is an interesting concept from an academic standpoint. However, using it as a reference for monetary policy decisions is not the right approach".
• However, he did state that "our bank lending surveys provide a much better indicator of the restrictiveness of our monetary policy, by showing how banks are easing or tightening financing conditions." This is notable, because the latest Bank Lending Survey reported a tightening in lending standards, suggesting ECB policy was indeed still in restrictive territory (and that more cuts are on the way).

Other headlines from the speech:

• "The high level of uncertainty we are now dealing with potentially calls for a more pragmatic approach, placing less weight on unobservable variables or model-based estimates with shortcomings and results expressed in wide ranges".
• "Estimating the impact on inflation is more difficult owing to the dampening effect of tariffs on demand and growth, as well as the fact that selective tariffs can lead to trade being redirected and diverted".