EURUSD TECHS: Corrective Bounce
- RES 4: 1.1007 High May 10
- RES 3: 1.0905 High May 16
- RES 2: 1.0838 50-day EMA values
- RES 1: 1.0807 20-day EMA
- PRICE: 1.0765 @ 05:52 BST Jun 2
- SUP 1: 1.0635 Low May 31 and the bear trigger
- SUP 2: 1.0608 Low Mar 17
- SUP 3: 1.0551 Low Mar 16
- SUP 4: 1.0516 Low Mar 15 and a key support
EURUSD traded higher Thursday. For now, short-term gains are considered corrective and the downtrend remains intact. Fresh trend lows this week reinforce bearish conditions. The 1.0653 objective has been breached, 76.4% of the Mar 15 - Apr 26 rally and this opens 1.0551, the Mar 16 low. A firm resistance is seen at 1.0807, the 20-day EMA. Clearance of this average is required to ease recent bearish pressure.
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EQUITIES: Negative Spillover From US Losses Hits Asia Pac Markets
Asia equity markets are down across the board today, following the negative lead from Wall St on Tuesday. Fresh banking concerns have weighed on financial related plays today, although China markets are still closed, while Japan is off for the rest of the week, which has likely dampened liquidity to some extent. US equity futures have crept higher this afternoon, albeit just back into positive territory. This hasn't impacted sentiment much, as the market awaits the Fed decision later.
- The HSI is down 1.75% at this stage. The tech sub index was off by nearly 3% at one stage. Losses have been fairly broad based though. Note the China Golden Dragon Index lost 3.63% in Tuesday US trade. The HS China Enterprises Index is down by 1.91% at this stage.
- In Australia, the S&P200 is off by 1.40%, as local bank stocks are hit from negative US spillover. NZ markets are also off by more than 1%, not buoyed by resilient Q1 employment figures.
- The Kospi is down by over 1.00%, the Kosdaq 1.40%, while the Taeix has fared slightly better, down by 0.50% at this stage.
- In SEA markets are tracking lower, with the commodity sensitive JCI off by over 1%. Other markets are down but losses haven't been larger than 1% at this stage.
EURUSD TECHS: Finds Support Below The 20-Day EMA
- RES 4: 1.1225 1.236 projection of the Mar 15 - 23 - 24 price swing
- RES 3: 1.1185 High Mar 31 2022
- RES 2: 1.1127 1.00 projection of the Mar 15 - 23 - 24 price swing
- RES 1: 1.1045/1095 High Apr 28 / 26 and key resistance
- PRICE: 1.1024 @ 05:38 BST May 3
- SUP 1: 1.0942 Low May 2
- SUP 2: 1.0909 Low Apr 17
- SUP 3: 1.0864/31 50-day EMA / Low Apr 10
- SUP 4: 1.0788 Low Apr 3
EURUSD remains in an uptrend and has found support just below the 20-day EMA. Last week’s fresh cycle high reinforces a bullish theme. The focus is on 1.1127, a Fibonacci projection. Note that moving average studies are in a bull-mode condition highlighting bullish sentiment. Key short-term support has been defined at 1.0942, Tuesday’s low. A clear break of it would signal scope for a deeper correction, potentially towards 1.0864, the 50-day EMA.
BUND TECHS: (M3) Bull Cycle Extends
- RES 4: 137.55 61.8% retracement of the Mar 20 - Apr 19 bear leg
- RES 3: 136.88 High Apr 11
- RES 2: 136.70 50.0% retracement of the Mar 20 - Apr 19 bear leg
- RES 1: 136.37 High May 2
- PRICE: 136.13 @ 05:15 BST May 3
- SUP 1: 134.98 20-day EMA
- SUP 2: 133.64/133.10 Low Apr 28 / 19 and the bear trigger
- SUP 3: 132.70 76.4% retracement of the Mar 2 - 20 rally
- SUP 4: 132.37 Low Mar 10
Bund futures rallied Tuesday and cleared short-term resistance at 135.74, the Apr 26 high. The break higher reinforces short-term bullish conditions and signals scope for an extension. The focus is on 136.70, a Fibonacci retracement. On the downside, key short-term support has been defined at the Apr 19 low of 133.10. This is the bear trigger and a break would reinstate the recent bearish theme. Initial support is at 134.98, the 20-day EMA.
