US STOCKS: Midday Equities Roundup: Off Record Highs, IT Outperforming

• +10,000 TUU5 105.12 calls, 3

• Early strength for EURUSD on Tuesday has strengthened the bullish trend as the pair extends further above resistance and the bull trigger that was breached last week at 1.1631, the Jun 12 high. Today’s peak of 1.1830 came within 20 pips of the next touted resistance of 1.1851, the Sep 10 2021 high.
• Appetite for fresh EURUSD longs may be contained by the close proximity to this Thursday's US employment print, as well as any further ECB commentary tied to specific EURUSD levels. As a result, other EUR crosses may gain in focus.
• Indeed, while building expectations for Fed rate cuts have driven the latest leg lower for the dollar, the renewed sensitivity of CHF and JPY to adjustments in core yields might place greater attention on the likes of EURJPY and EURCHF.
• For EURJPY, the significant upswing across June has stalled in recent sessions, with the cross appearing to be in more of a holding pattern between two important chart points between 168-170, raising the prospects that we may be at an inflection point. Indeed, the uptrend is in overbought territory and a pullback would unwind this condition. Support to watch lies at 166.94 (20-day EMA), of which a break would suggest potential for a deeper retracement.
• For EURCHF, we highlighted that a close below the 0.93 handle would certainly renew the focus on the key double bottom support, located around 0.9210.

Source: Bloomberg Finance L.P. / MNI

• In rare comments on the single currency’s exchange rate, ECB Vice President Luis de Guindos told Bloomberg that the speed of the euro’s ascent is more worrying than its current level. While such remarks on the speed of FX adjustment are not unprecedented, his associated commentary on specific levels for EURUSD might provide nascent concerns for investors forecasting a substantial further appreciation across the second half of 2025.
• On the sidelines of the ECB’s annual forum in Sintra, the Spanish official said that while a level of 1.20 for EURUSD is perfectly acceptable, something beyond that would be much more complicated. Furthermore, ECB’s Kazaks of Latvia acknowledged that the consumer-price outlook will be affected by the currency, stating that “if the euro was to significantly appreciate further, this would weigh down on inflation and exports, which could tilt the balance toward another cut.”
• Since the beginning of the sharp EURUSD upswing, 1.20 has been a popular forecast across the sell-side. While the level has pivotal/psychological significance, investors may be concerned about the scale of the dollar move already in the bag and the consensus nature of the view at this juncture. Sure enough, Goldman Sachs stated the pace of the inflows to Europe could taper off slightly as they did in 2017, which may imply a slightly slower and choppier path higher for EURUSD from here.
• Separately, Rabobank say given there is a lot of good news currently priced into the EUR, they see scope for pullbacks in favour of the dollar. They see risk of dips back to the EURUSD 1.14 area on a 3m view, though they continue to forecast the pair at 1.20 on a 12-month horizon.