EUROZONE DATA: Energy Prices Push Portuguese and Irish Inflation In Opposite Directions
This morning also saw the release of Portuguese and Irish flash inflation for January. In Portugal, the headline HICP estimate rose to 2.6% Y/Y (vs 1.9% prior) after 4 consecutive months of deceleration prior. In Ireland, flash HICP was 2.7% Y/Y (vs 3.2% prior).
- There was no consensus for either set of data.
The acceleration of the Portuguese headline rate was a result of "price increases in electricity and the ending of the VAT exemption for several essential food items" according to the press release.
- As a result, NSA energy and processed/unprocessed food components turned positive on a sequential NSA monthly basis (after negative December prints), with the annual inflation rates also increasing.
- Core CPI (ex-energy and unprocessed foods) fell a touch to 2.46% Y/Y (vs 2.64% prior).
- Headline CPI was 2.34% Y/Y (vs 1.42% prior) and 0.05% M/M (vs -0.41% prior).
- Headline HICP was 2.6% Y/Y (vs 1.9% prior) and -0.1% M/M (vs -0.7% prior).
- Portugal had a 2.4% weight in the Eurozone HICP basket in 2023.
- Ireland had a 1.5% weight in the Eurozone HICP basket in 2023.
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AUSSIE 10-YEAR TECHS: (H4) Bullish Outlook
- RES 3: 96.160 - High Jul 20
- RES 2: 96.126 - 2.0% Upper Bollinger Band
- RES 1: 96.110 - High Dec 28
- PRICE: 96.035 @ 15:12 GMT Dec 29
- SUP 1: 95.390/275 - Low Nov 27 / 14
- SUP 2: 94.966 - 1.0% 10-dma envelope
- SUP 3: 94.965 - Low Oct 31
Aussie 10yr futures remain in an uptrend and the contract traded to new highs of 96.110 this week. This takes out key resistance at the 96.050 level, opening levels seen higher at the 2.0% upper Bollinger Band of 96.126. The recent recovery has tipped prices north of the 100-dma - reinforcing the current bullish theme. Key support lies below at 95.390 as well as 95.275. Weakness through here could mark the conclusion of the bounce off the bear trigger at 94.965.
USDCAD TECHS: Bears Remain In The Driver’s Seat
- RES 4: 1.3513 50-day EMA
- RES 3: 1.3391 20-day EMA
- RES 2: 1.3371 High Dec 20 / 21
- RES 1: 1.3295 High Dec 25
- PRICE: 1.3200 @ 15:25 GMT Dec 29
- SUP 1: 1.3177 Low Dec 27
- SUP 2: 1.3093 Low Jul 14 and key support
- SUP 3: 1.3044 2.0% 10-dma envelope
- SUP 4: 1.2992 50.0% retracement of the 2021 - 2022 bull phase
The USDCAD trend outlook remains bearish and price traded lower on Wednesday. The pair has recently cleared a bear trigger at 1.3480, the Dec 4 low. Furthermore, all key short-term retracement points have been breached. These developments reinforce a bearish theme and maintain the price sequence of lower lows. Sights are on 1.3093, the Jul 14 low and a key support. Resistance to watch is 1.3391, the 20-day EMA.
AUDUSD TECHS: Approaching Key Resistance
- RES 4: 0.6961 1.236 proj of the Nov 10 - Dec 4 - Dec 7 price swing
- RES 3: 0.6921 High Feb 20
- RES 2: 0.6900 High Jun 16 and a key resistance
- RES 1: 0.6871 High Dec 28
- PRICE: 0.6821 @ 15:24 GMT Dec 29
- SUP 1: 0.6773 Low Dec 22
- SUP 2: 0.6714 20-day EMA
- SUP 3: 0.6605 50-day EMA
- SUP 4: 0.6526 Low Dec 7 and key support
Bullish trend conditions in AUDUSD remain intact and this week’s continuation higher reinforces current conditions. The climb maintains the bullish price sequence of higher highs and higher lows. Sights are on 0.6900, the Jun 16 high and the next key key resistance. On the downside, key short-term support is unchanged at 0.6526, the Dec 7 low. Initial firm support is at 0.6714, the 20-day EMA. Short-term weakness is considered corrective.
