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USDCAD TECHS: Clears Resistance
- RES 4: 1.3977 High Oct 13 ‘23 and a key M/T resistance
- RES 3: 1.3899 High Nov 1 and a key resistance
- RES 2: 1.3846/55 High Apr 16 and the bull trigger / High Nov 10 2023
- RES 1: 1.3785 High Apr 30
- PRICE: 1.3760 @ 16:35 BST Jun 10
- SUP 1: 1.3654/1.3590 50-day EMA / Low May 16 and the bear trigger
- SUP 2: 1.3547 Low Apr 9
- SUP 3: 1.3512 50.0% retracement of the Dec 27 - Apr 16 bull cycle
- SUP 4: 1.3478 Low Apr 4
USDCAD traded higher Friday and breached resistance at 1.3748, 61.8% of the Apr 16 - Mar 16 bear leg. The trend outlook remains bullish and Friday’s gains are a positive development. A continuation higher would refocus attention on the bull trigger at 1.3846, the Apr 16 high. On the downside, key support has been defined at 1.3590, May 16 low. A clear break of this level would threaten a bullish theme and signal scope for a deeper retracement.
US TSYS: Off Post-Auction Lows, Focus on Midweek CPI, FOMC
- Treasuries held lower levels by the close, just off session lows after the bell as stocks reversed early weakness. Rates held narrow ranges for most of the session, extending lows (TYU4 109-00.5, -9.5) after $58B 3Y note auction (91282CKV2) tailed 1.1bp: 4.659% high yield vs. 4.648% WI; 2.43x bid-to-cover vs. 2.63x prior month (Jan high).
- Relatively quiet start to the week, Treasuries are mirrored weaker EGBs after France President Macron called for snap election following weekend parliamentary elections.
- While far-right forces made strong gains vs. the majority center-right European People’s Party (EPP) in EU elections, Treasury futures pared losses ahead of Wednesday's May CPI and FOMC policy announcement.
- Sep'24 10Y Treasury futures are currently trading -5.5 at 109-04.5 -- inside 8-tic range: 109-00.5 low/109-08.5 high. Friday's sharp sell-off undermines the recent bullish theme, highlighting a potential bearish reversal. The TYU4 contract breached both the 50- and 20-day EMA, while continued decline would strengthen a bearish threat at at 108-27.5 (June 3 low).
- Cash yields are currently mildly higher: 5s +.0141 at 4.4767, 10s +.0296 at 4.4631%, 30s +.0354 at 4.5900%, while curves are steeper: 2s10s +3.804 at -41.735, 5s30s +2.131 at 11.161.
AUDUSD TECHS: Trades Through Support
- RES 4: 0.6771 High Jan 3
- RES 3: 0.6751 76.4% retracement of the Dec 28 - Apr 19 bear leg
- RES 2: 0.6729 High Jan 12
- RES 1: 0.6631/6714 20-day EMA / High Jun 16 and the bull trigger
- PRICE: 0.6605 @ 16:31 BST Jun 10
- SUP 1: 0.6576 Low Jun 10
- SUP 2: 0.6558 Low May 8
- SUP 3: 0.6539 50.0% retracement of the Apr 19 - May 16 bull leg
- SUP 4: 0.6497 61.8% retracement of the Apr 19 - May 16 bull leg
A sharp sell-off in AUDUSD Friday undermines the recent bullish theme. The move lower resulted in a break of both the 20- and 50 -day EMAs. Furthermore, support at 0.6591, the May 30 low has also been pierced. A continuation lower would highlight a possible reversal and signal scope for a deeper pullback, towards 0.6558 initially, the May 8 low. For bulls, a resumption of gains would open the bull trigger at 0.6714, the Jun 16 high.
