EMISSIONS: EUA Auction Calendar Week Ahead (Calendar Week 34)

• GBP has been consolidating its relatively weak recent position, hovering around 1.3450. A UK jobs report from KPMG REC showed a particularly pessimistic/stagflationary set of figures on Monday, keeping sterling on the back foot ahead of US data today and UK inflation & labour market data later this week.
• It is worth highlighting that GBPUSD (shown below) has exposed key trendline support at 1.3430, drawn from the Jan 13 low. The close proximity to this level promotes GBP as a noteworthy candidate to particularly suffer from firmer-than-expected inflation figures in the US. A clear break of the trendline would strengthen a bearish threat and expose 1.3371 initially, the Jun 23 low. Below here, the next target would be 1.3335, the May 20 low.
• Conversely, the Australian dollar may be in a heightened position to benefit from soft US data, as the backdrop of a hawkish RBA surprise and the ongoing resilience for major equity benchmarks fosters a supportive tone. Technical indicators also remain bullish for AUDUSD, and a break of the 0.66 handle would confirm a resumption of the ongoing uptrend. The US election related highs are located at 0.6688.
• Highlighting the above themes, GBPAUD has extended its recent weakness following a breach of trendline support to reach an important technical pivot just below 2.05. The next downside target comes in at 2.03, the Dec 19 high.

Source: Bloomberg Finance L.P. / MNI

• On the commodity front, the bull cycle in Gold that started Jun 30, remains intact and the yellow metal is holding on to its recent gains. Note that medium-term trend conditions are bullish - moving average studies are in a bull-mode position highlighting a dominant uptrend. An extension would expose $3395.1, the Jun 23 high, and $3451.3, the Jun 16 high. On the downside, the bear trigger is $3248.7, the Jun 30 low. First support to watch is 3282.8, the Jul 9 low.
• In the oil space, WTI futures maintain a bearish tone following the reversal from the Jun 23 high, and recent gains still appear corrective. Support to watch is the 50-day EMA, at $65.46. The average has been pierced, a clear break of it would signal scope for a deeper retracement. This would expose $58.87, the May 30 low. Initial resistance to monitor is $71.20, the 50.0% retracement of the Jun 23 - 24 high-low range. Key resistance is at $78.40, the Jun 23 high.

• 2Q EPS $5.24
• 2Q ADJ. REV. $45.68B, EST. $44.05B
• 2Q FICC SALES & TRADING REV $5.69B, EST. $5.22B
• 2Q INVESTMENT BANKING REV. $2.68B, EST. $2.16B" - bbg

Highlights from the JPM results, which have seen the stock swing between gains and losses pre-market:

• Markets: "IB activity started slow but gained momentum as market sentiment improved, and IB fees were up 7% for the quarter.", "Markets revenue up 15%, with fixed income up 14%, equities up 15%."
• The economy: "US economy remained resilient. Finalization of tax reform and potential deregulation are positive for the economic outlook."
• On Tariffs: "Significant risks persist – including from tariffs and trade uncertainty"
• Home lending: "Home Lending net revenue was $1.3 billion, down 5%, predominantly driven by lower net interest income."