AUDUSD TECHS: Corrective Bounce
- RES 4: 0.6762 High Oct 9
- RES 3: 0.6733 High Oct 13
- RES 2: 0.6604/88 50-day EMA / High Nov 7 and a reversal trigger
- RES 1: 0.6534/50 20-day EMA / High Nov 25
- PRICE: 0.6512 @ 16:03 GMT Nov 29
- SUP 1: 0.6434 Low Nov 26
- SUP 3: 0.6400 Round number support
- SUP 3: 0.6350 Low Aug 5 and a key support
- SUP 4: 0.6339 Low Nov 10 2023
A bearish theme in AUDUSD remains intact. The fresh cycle low on Tuesday marks an extension of the price sequence of lower lows and lower highs. Note that moving average studies are in a bear-mode position, highlighting a dominant downtrend. Scope is seen for a move towards 0.6350, the Aug 5 low and the next key support. The pair has recovered from its recent lows - a correction. Initial firm resistance to watch is 0.6534, the 20-day EMA.
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AUDUSD TECHS: Fresh Cycle Low
- RES 4: 0.6852/6889 High Oct 4 / 3
- RES 3: 0.6762 High Oct 9
- RES 2: 0.6684/6712 20- and 50-day EMA
- RES 1: 0.6622 Low Sep 11
- PRICE: 0.6578 @ 16:14 GMT Oct 30
- SUP 1: 0.6537 Low Oct 30
- SUP 2: 0.6508 Low Aug 8
- SUP 3: 0.6490 76.4% retracement of the Aug 5 - Sep 30 bull leg
- SUP 4: 0.6472 Low Aug 6
A bear cycle in AUDUSD remains intact and the pair has again traded to a fresh cycle low, today. This reinforces the current downtrend. A key support at 0.6622, Sep 11 low, has been breached, strengthening a bearish theme and note too that the pair has also cleared 0.6576, 61.8% of the Aug 5 - Sep 30 bull leg. A continuation lower would open 0.6490, the 76.4% retracement. Initial firm resistance to watch is 0.6622, the Sep 11 low.
EURJPY TECHS: Heading North
- RES 4: 169.20 High Jul 24
- RES 3: 168.01 High Jul 26
- RES 2: 167.40 61.8% retracement of the Nov 11 - Aug 5 bear leg
- RES 1: 166.60 High Oct 30
- PRICE: 166.37 @ 16:11 GMT Oct 30
- SUP 1: 163.28 20-day EMA
- SUP 2: 161.85/161.01 Low Oct 17 / Low Oct 4
- SUP 3: 158.11 Low Sep 30
- SUP 4: 157.05/155.15 Low Sep 18 / 16
A bullish theme in EURJPY remains intact and Wednesday’s fresh cycle high reinforces current conditions. The latest recovery resulted in the break of two important resistance points; 163.49, the Sep 27 high and 163.89, the Aug 15 high. This move highlights a stronger reversal. 164.92, 50.0% of the Nov 11 - Aug 5 bear leg, has also been cleared. 166.53, the Jul 31 high, has given way - opening 167.40 for direction. Initial firm support to watch is 161.85, the Oct 17 low.
US TSYS: October ADP Jobs Gain Surprise Saps Short End Support
- Treasuries look to finish mostly lower Wednesday, curves flatter with Bonds outperforming after a volatile first half.
- Treasuries opened higher on the back of strong overnight support in Gilts ahead this morning’s eagerly awaited UK Budget statement. Rates gapped lower following a much better than expected ADP jobs gain for October at 233k (cons 111k) for its strongest monthly print since Jul’23, followed by an upward revised prior to 159k (initial 143k).
- Treasury futures bounced off post-ADP lows, mirroring a bounce in Bunds and Gilts as markets digested the UK Budget statement. Mixed US data dropped at the same time with stronger than expected Core PCE inflation and Real GDP growth in the Q3 advance report technically below expected at 2.8% annualized. Comments from former Fed VC Brainard that Friday’s employment data will likely be lower due to “disruptive hurricanes, strike activity” contributed to the bounce in intermediate to long end Tsys.
- The midmorning drive to session highs was short lived, however, support evaporated as details regarding a huge increase in gilt issuance over 5 years spurred heavy selling in EGBs. Meanwhile, pending home sales stronger than expected the best single monthly increase since June 2020 while the Quarterly Refunding Announcement came out in line with estimates at $125B: $58B 3Y notes, $42B 10Y notes and $25B 30Y Bonds.
- After the bell, the Dec'24 10Y contract is trading -6 at 110-18 vs. 110-17 low, 10Y yield at 4.2823 (+.0282). Curves are flatter: 2s10s -4.377 at 10.998 (-9.646 low), 5s30s -7.240 at 34.296.
- Focus turns to Thursday’s weekly claims, personal income/spending and MNI’s Chicago PMI data, not to mention Friday's October employment data and next Tuesday's Presidential Election.
