AUDUSD TECHS: Fresh Trend Low
- RES 4: 0.6747 High Sep 20
- RES 3: 0.6689 20-day EMA
- RES 2: 0.6656 High Sep 23
- RES 1: 0.6550 High Sep 26
- PRICE: 0.6391 @ 07:19 BST Sep 28
- SUP 1: 0.6377 Intraday low
- SUP 2: 0.6337 Low Apr 24 2020
- SUP 3: 0.6283 Low Apr 23 2020
- SUP 4: 0.6255 1.236 proj of the Apr 5 - May 12 - Jun 3 price swing
AUDUSD remains in a downtrend and the pair is trading lower today. The outlook remains bearish. Last week’s move lower resulted in a break of support at 0.6682, the Jul 14 low and bear trigger. This strengthens bearish conditions and maintains the broader bearish price sequence of lower lows and lower highs. The focus is on 0.6373 next, the May 4 2020 low. Initial firm resistance has been defined at 0.6689, the 20-day EMA.
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BUNDS: A big downside opening gap
- A big 51 ticks downside opening gap for Bund, and despite the UK out on for a Bank Holiday, volumes overnight are above averages.
- Downside gap is from 149.46 down to 148.95.
- Support in Bund is 148.24 (1st July low), printed 148.25 low.
- Yesterday: "ECB Needs ‘Resolute’ Hike of at Least a Half-Point, Kazaks Says""
- "ECB must act forcefully to contain record inflation and keep expectations for future price growth anchored as the weak euro exacerbates a surge in energy costs, according to Governing Council member Olli Rehn.
- There's no Tier 1 data for the session, ahead of a packed week for data, ending with the NFP on Friday.
- SPEAKERS: ECB Lane, Fed Brainard.
- SUPPLY: EU NGEU
SWEDEN: GDP lower than expected but upward revisions to prior data
- GDP lower than expected: On a Q/Q basis 0.9% growth in Q2 (1.4% expected) but there was a big upward revision to Q1 from -0.8% to +0.2%. There was also a 0.2ppt upward revision to Q4-21 and downward revisions to Q1-21 and Q3-21. On a Y/Y basis 3.8% this equates to vs the 4.2% survey number.
- In terms of the breakdown consumption rose 1.6%Q/Q, gross fixed capital formation 3.3% (of which "The main contribution to the increase came from investments in buildings and structures as well as in intellectual property products."), while net exports were -0.5%, government consumption -0.3% and inventories unchanged.
- This will probably not do much to change the Riksbank's policy decision at next month's meeting with the market expecting the debate to be between a 50bp or a 75bp hike due to much higher than forecast inflation.
- So overall the details look better than the headline numbers would suggest.- EURSEK moved a little higher on the release (10.65 to 10.656) but is now slightly below its prevailing levels ahead of the data at 10.463.
AUDUSD TECHS: Clears Support
- RES 4: 0.7040 High Aug 16
- RES 3: 0.7009 High Aug 26
- RES 2: 0.6949 20-day EMA
- RES 1: 0.6908 Intraday high
- PRICE: 0.6858 @ 06:59 BST Aug 29
- SUP 1: 0.6841 Intraday low
- SUP 2: 0.6789 76.4% retracement of the Jul 14 - Aug 11 upleg
- SUP 3: 0.6719 Low Jul 15
- SUP 4: 0.6682 14 and the bear trigger
A bearish threat in AUDUSD firmed Friday following a sharp reversal from the intraday high of 0.7009. Today's move lower marks a bearish start to the week and this has resulted in a break of support at 0.6856, the Aug 23 low. The move lower has confirmed a resumption of the bear cycle that started Aug 11. Attention is on 0.6789, a Fibonacci retracement. On the upside, key short-term resistance has been defined at 0.7009.
