AUDNZD: Antipodean Update: Both Trade Well Supported

The S&P(ESU6) range overnight was 7684.00 - 7750.50, SPX closed +0.86%, Asia is currently trading around 76890, -0.50%. Stocks have opened up under early pressure as news the leaders of AI would like to slow down its pace of development. This obviously has huge implications for the entire sector who is supplying the chips and building the infrastructure. There are a variety of debates going on with regards to the actual goal of this weekend's call from the view it would reduce their product liability in the event of a damaging cyberattack. Or ratcheting up support to regulate so as to push out the open sourced models who are bringing down the cost they can charge and thereby making them unprofitable. With Oil remaining very well bid above $100 as supply constraints in the Straits of Hormuz are added to by the events in Saudi Arabia and Russia there are clear signs of stress and red flags that are worth keeping an eye on. While the S&P(SPX) holds above 7250-7300 the bulls remain in control but the series of lower highs on the Dailies is evidence of a market losing momentum and in danger of pulling back. On the day, the support is around 7580-7600 again and I will be watching to see if stocks can continue to ignore the headwinds mounting or do they play catch up at some point.      

• (Bloomberg) - “Leaders of the world’s biggest artificial intelligence platforms said it’s time to slow the development pace of their most advanced — and most lucrative — models, citing escalating risks of the technology.”  https://blinks.bloomberg.com/news/stories/TL9ZS3T96OSH
• David Sacks on X: “Most of all, stop pretending the motivation to slow down is purely altruistic. You face massive product-liability exposure if your products enable a truly damaging cyberattack. The market already punishes models that behave in unpredictable or unauthorized ways. After the Hugging Face episode, it is simply good business for OpenAI and Anthropic to trade some raw power for reliability and predictability. Call it alignment if you want. It is also just giving customers what they want.” Full thread - https://x.com/DavidSacks/status/2098973625252708460?s=20
• Boring Business on X: “Why do you need the government to stop AI progress inside your private company when you are the CEO of the company already?”
• Arnaud Bertrand on X: “The plan transparently looks like this: agree among themselves not to compete too hard, get an antitrust waiver to make it legal, and while they're at it, get Washington - under the veneer of "safety" - to kneecap Chinese competitors because only "democratic" models can be in this "safe pacing" club.” Full thread - https://x.com/RnaudBertrand/status/2099019556769656854?s=20
• Grant Hummer on X: “Translation: our gross margins are getting competed down to 0 by open source models and our capex burn rate is too high. Let’s maintain our margins with regulatory capture, ban open source models, and slow down the capex arms race. All with a virtue signaling cherry on top.” 
• The S&P 500 Index Average True Range(ATR) for the last 10 Trading days:  61 Points

Fig 1: S&P 500(SPX) Index Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P

"ELECTION AUTHORITY PROJECTION: SWEDEN'S CENTRE-LEFT OPPOSITION BLOC NOW SEN AT 176 SEATS VS 173 FOR THE GOVERNING BLOC - [RTRS]"

USD/CNH spot tracks near 6.7070/75 in early Monday dealings, little changed versus end Friday levels. The pair saw supply emerge just short of 6.7150 in Friday trade as the USD received some support from firmer Fed tightening expectations and higher oil. Still, CNH managed a 0.1% gain Friday, modestly outperforming a flat BBDXY Index outcome for the session. 

• USD/CNH remains sub all key EMAs, which continue to track lower, the 20-day resistance point now close to 6.7200. We remain within striking distance of a 6.7000 test, but broader macro supports from higher oil and proximity to this week's Fed meeting outcome may see support in the first parts of the week. Still, broader technical risks for the pair remain skewed lower (6.6975, early 2023 lows, remains in focus on any break sub 6.7000).
• Spot USD/CNY finished up at 6.7074 on Friday, while the CNY CFETS basket tracker rose 0.14% to 101.44. This puts the index up marginally from recent multi month lows.
• The local data calendar still awaits Aug new loans and aggregate finance data. Tomorrow we get Aug home price data and Aug activity figures.
• Elsewhere US President Trump played down concerns that China President XI may cancel a planned trip to the USD later this month. Via BBG: "President Donald Trump said he is not worried that Chinese President Xi Jinping will cancel a highly anticipated visit later this month. Trump’s comments follow a recent report that China had warned the US that it would scrap Xi’s upcoming visit if the US approved new arms sales to Taiwan, a major point of contention for Beijing."