US IG AUTOMOTIVE: MNI US IG AUTOs: Week In Review

• US equity indexes held mild to moderately higher levels late Wednesday, after a rather erratic late summer session. Risk sentiment gained earlier as crude retreated from overnight highs after Saudi Arabia pled for US/Iran to deescalate, US officials expressing optimism.
• At the moment, the DJIA trades +.47%, SPX emini +.44%, the Nasdaq +.4%.
• Communication Services sector led advances in the the second half as media/entertainment shares outperformed: Reddit Inc +8.46%, Charter Communications Inc +8.17%, Trade Desk Inc +5.08% while Paramount Skydance Corp gained +4.27%.
• IT sector shares led late declines: Palo Alto Networks -10.5%, Datadog Inc -6.75%, Crowdstrike Holdings Inc -6.45% while Palantir Technologies Inc fell 6.15%.

• While the RBNZ delivered an expected 25bp hike to 2.75%, a very cautious stance on both the extent and timing of further tightening has significantly weighed on the New Zealand dollar.
• Despite a moderate bounce for NZDUSD, spot remains 0.83% lower as we approach the APAC crossover and looks likely to close comfortably below the bull channel which represents an important short-term technical breakout point around the 0.59 handle. AUDNZD remains 1.15% in the green and remains within touching distance of 1.2288 cycle highs.
• Separately, while the Bank of Canada held the 2.25% policy rate Wednesday, Governor Macklem’s acknowledgement of upside inflation risks increasing and a downplaying of growth risks have provided a solid boost to the Canadian dollar.
• USDCAD had been rising in early trade Wednesday, but after respecting 50-day EMA resistance, the hawkish BOC impetus leaves the pair around 100 pips off the days highs around 1.3840 approaching the close. This leans in to the narrative that recent USDCAD strength was technically corrective, with downside focus remaining on 1.3732, the Aug 21 low.
• Elsewhere, USDJPY had a volatile session which translated to an impressive 217 pip range. The initial impulse which dragged USDJPY back below 160 was a hawkish sounding BOJ Takata who said the bank needs to raise interest rates flexibly to address upside risks to prices, arguing it should not be constrained by estimates of the neutral rate or market expectations for the pace of tightening.
• Session lows of 158.22 were just shy of the next support at 158.03, the Aug 20 low. Having bounced back towards 159 in late trade, clearance of said support would be needed to strengthen a bearish threat.
• During APAC on Thursday, we have a plethora of central bank speakers including RBNZ Gov Breman and RBA Assistant Governors Jones and Hunter. Swiss CPI and GDP highlight the European calendar before US ISM Services.

• RES 4: 187.95 High Apr 17 and a key M/T bull trigger 
• RES 3: 187.47 High Jul 29 and a key resistance  
• RES 2: 186.65 0.764 proj of the Aug 3 - 1- 12 price swing
• RES 1: 186.02 High Aug 21 and short-term bull trigger 
• PRICE: 184.07 @ 16:50 BST Sep 02
• SUP 1: 183.66/183.16 Low Sep 02 / Low Aug 12 
• SUP 2: 181.33 Low Aug 7 
• SUP 3: 179.37 Low Aug 3 and key support
• SUP 4: 178.82 High Oct 30 2025

A sharp pullback in EURJPY Wednesday resulted in a breach of initial support around the 50-day EMA, at 184.88. This highlights a potential early reversal signal and if correct the end of the recent corrective phase that started on Aug 3. A continuation lower would signal scope for a move towards 183.16, the Aug 12 low. For bulls, initial resistance to watch is 186.02, the Aug 21 high. Clearance of this hurdle would reinstate the recent bull leg.