US STOCKS: Late Equities Roundup: Stocks Recover Steep Losses, Near Flat on Week

• RES 4: 158.87 High Jan 10 and a key resistance
• RES 3: 158.29 2.618 projection of the Sep 17 - 26 - Oct 1 price swing
• RES 2: 158.00 Round number resistance 
• RES 1: 157.89 High Nov 20 and bull trigger 
• PRICE: 156.27 @ 15:43 GMT Dec 23
• SUP 1: 155.84/154.40 20- and 50-day EMA values
• SUP 2: 153.62 Low Nov 14  
• SUP 3: 152.82 Low Nov 7 
• SUP 4: 151.54 Low Oct 29 

The trend structure in USDJPY is bullish and the latest pullback is considered corrective - for now. Note that MA studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 157.89, the Nov 20 high and a bull trigger. A break of this hurdle would confirm a resumption of the uptrend. Support to watch lies at 154.40, the 50-day EMA. A clear breach of it would undermine the bull theme and signal scope for a deeper corrective pullback. 

The deliberations to the Bank of Canada's December meeting portrayed a Governing Council that was uncertain on the direction of its next move beyond the currently-signaled indefinite rate hold (link here)

• The key paragraph here mentioned that they discussed "whether it was more likely that their next move would be to raise or lower the policy interest rate. Given the high level of uncertainty, members agreed that while the current policy rate was at about the right level in the current situation, it was difficult to predict when and in which direction the next change in the policy rate would be."
• This was a little less subtle of a steer about the optionality being considered by Governing Council than Gov Macklem in the press conference, who didn't exactly dismiss the possibility of hikes next year, noting that BOC will be assessing data in a "symmetric way" in looking for material changes to the outlook in "either direction".
• Markets continue to pencil in a little under one 25bp rate hike through end-2026, unchanged vs before the Deliberations release.
• The messaging on the economy was basically in line with what we already heard in the policy statement and Gov Macklem's press conference.
• Indeed despite encouraging labor market and GDP readings, Governing Council was circumspect on the outlook. One of the key areas of uncertainty was on trade: "members agreed the Canadian economy was showing signs of resilience after a year of trade upheaval, but uncertainty remained high. They would remain cautious in interpreting incoming data given recent volatility and would be prepared to react if their outlook changed materially."
• In particular they discussed the upcoming trade renegotiations with the US and Mexico: "the upcoming review of the Canada-United States-Mexico Agreement (CUSMA) was a significant risk. The uncertainty leading up to and during negotiations would likely weigh on business investment. Members shared that business leaders they had met across the country saw the future of CUSMA as a significant strategic risk to their businesses. A worst-case scenario involving the dissolution of CUSMA and higher tariffs would be very damaging to the Canadian economy. Alternatively, a resolution of CUSMA negotiations that provided some stability in North American trade policy could spur on business investment."

• RES 4: 0.8865 High Nov 14 and a bull trigger   
• RES 3: 0.8840 High Nov 20
• RES 2: 0.8818 High Nov 26
• RES 1: 0.8797 High Dec 17 and a key resistance
• PRICE: 0.8730 @ 15:42 GMT Dec 23
• SUP 1: 0.8721 Low Dec 9 & 23 and a key near-term support
• SUP 2: 0.8706 76.4% retracement of the Oct 8 - Nov 14 bull leg
• SUP 3: 0.8670 Low Oct 21   
• SUP 4: 0.8656 Low Oct 8 and a key support  

A bull cycle in EURGBP that started Dec 9 remains in place for now, and support to watch lies at 0.8721, the Dec 9 low. A clear break of this level would undermine the bull theme and instead signal scope for a deeper corrective pullback. This would open 0.8706, a Fibonacci retracement point. Initial key short-term resistance has been defined at 0.8797, the Dec 17 high. Clearance of this hurdle would be a bullish development.