EURGBP TECHS: Bear Cycle Extends

• RES 4: 147.05 50-day EMA   
• RES 3: 146.54 Low Mar 11  
• RES 2: 144.24 20-day EMA
• RES 1: 144.03 High Apr 25
• PRICE: 142.18 @ 16:23 BST Apr 29
• SUP 1: 141.49 Low Apr 23   
• SUP 2: 139.79 1.382 proj of the Feb 12 - Mar 11 - 28 price swing
• SUP 3: 138.82 1.500 proj of the Feb 12 - Mar 11 - 28 price swing
• SUP 4: 138.07  Low Jul 28 ‘23

The recovery that started Apr 22 in USDJPY is considered corrective. Resistance to watch is 144.24, the 20-day EMA. A clear break of this level would signal scope for a stronger recovery. Resistance at the 50-day EMA, is at 147.05. Moving average studies are in a bear-mode position highlighting a dominant downtrend. A resumption of the trend would open 139.79 next, a Fibonacci projection.

The five Regional Fed services surveys for April (NY, Dallas, KC, Philadelphia, Richmond) combined point to a continued deterioration in the ISM Services barometer when it is published on Monday May 5.

• Current expectations are for a tick lower in ISM services to 50.4 in April from 50.8 prior. That would mark a fresh post-June 2024 low.
• The regional Fed average for current conditions fell to the lowest since May 2020 in April, pointing to potential downside in ISM Services vs consensus (at the time, the ISM index was printing in the 40s.) Four of the five surveys (KC excepted) saw a deterioration of conditions in April vs March.
• This is likewise the lowest that service firms' forward expectations have been since May 2020, per the regional Fed average.

Marist notes in a new survey: “At the 100-day mark of President Donald Trump’s second term in office, a plurality of Americans give his performance a failing grade.” 

• Marist adds: “While Trump’s “F” rating is due mainly to the perceptions of most Democrats and a plurality of independents, a majority of Americans, overall, disapprove of the president’s job performance.”
• The report continues: “On the specific issues of the economy, tariffs, foreign policy, and immigration, President Trump’s approval ratings are upside down. To compound matters for the president, a slim majority of Americans describe the direction in which he is moving the nation as change for the worse; six in ten say the nation’s current economic conditions are a result of President Trump’s policies, and a majority of Americans think that placing tariffs on imports will hurt the U.S. economy.”
• A new survey from NBC News shows that inflation is the most concerning economic issue for voters. The White House is likely to take note of the findings considering inflation’s role as ‘incumbent killer’ in a series of 2024 international elections.
• Trump’s activity on Truth Social suggests he is taking note of a recent surge of negative polling data: “The Polls from the Fake News are, like the News itself, FAKE! We are doing GREAT, better than ever before.”

Figure 1: President Trump’s Grade at 100 Days

Source: Marist