OIL: Oil End Of Day Summary: Crude Falls

Wednesday's Europe rates/bond options flow included: 

• RXV5 131/130/129p fly, bought for 15.5 in 2k.
• ERH6 99.0/99.50 call spread, bought for 0.75 in 10k
• SFIQ5 96.15/96.20 call spread saw paper pay 1.0 on 7K
• SFIZ5 96.55/96.75cs, bought for 2 in 2k
• SFIZ5 96.60/96.80/97.00/97.20c condor sold at 0.75 in ~1.3k with SFIZ5 96.50/96.70cs, sold at 2.25 in ~2.88k
• SFIM6 96.75/97.50/98.25c fly, bought for 10.25 in 8k
• SFIM6 97.00 calls paper paid 8.75 on 4K vs. 96.535

• RES 4: 0.8835 High May 3 2023  
• RES 3: 0.8800 Round number resistance
• RES 2: 0.8781 2.236 pro of the Mar 3 - 11 - 28 price swing
• RES 1: 0.8735/8769 High Aug 3 / High Jul 27 and the bull trigger 
• PRICE: 0.8723 @ 16:09 BST Aug 6
• SUP 1: 0.8611 Low Jul 31 
• SUP 2: 0.8597 50-day EMA 
• SUP 3: 0.8540 Low Jun 30 
• SUP 4: 0.8508 Low Jun 27

The trend set-up in EURGBP is bullish and the latest recovery from last Thursday's low signals the end of the short corrective pullback between Jul 28 - 31. Moving average studies remain in a bull-mode position highlighting a clear uptrend. Key resistance and the bull trigger is at 0.8769, the Jul 27 high. On the downside, support to watch lies at the 50-day EMA 0.8601. A clear break of it would strengthen a bear threat. 

• The USD resumed the recent spell of weakness Wednesday, helping the ICE USD Index through the post-NFP low. Prices have also broken interim support at the 50-dma - a level that had drawn notable focus through the YTD downtrend and helped define the downtrend. EUR/USD topping the Friday high and layered resistance between 1.1597-00 further triggered USD selling.
• Interjections from potential next Fed chair Hassett helped weigh on the USD, as he voiced his support for a more Greenspan-like approach to policymaking, with a lesser focus on consensus-forming. This led markets to more quickly price in rates conforming to Trump's preference for easy policy. A later Bloomberg report that suggested Trump was being advised to appoint an interim Fed governor that can skip the Senate nomination process made little impact on pricing - although the expedited timeline could mean a new Trump appointee is installed ahead of the September rate decision.  
• Resilient GBP/USD comes despite the NIESR estimates out earlier today that suggests the government are facing a more dire fiscal picture in Autumn than previously expected - suggesting markets are well priced for sharp spending cuts and/or tax rises at the next Budget. Instead, it's the BoE decision Thursday that could be of more consequence, and in particular the vote split: 2-5-2 (50bps cut, 25bps cut, unch) is the modal consensus - and we flag that the baseline projections may become less
  useful as a communication tool going forward - and as such, less market relevant. EUR/GBP remains in a nascent uptrend, evident in the recovery from last Thursday's low. Key resistance and the bull trigger remains at 0.8769, the Jul 27 high.
• Focus Thursday turns to the ECB's economic bulletin, US weekly jobless claims and unit labor costs and the latest Chinese trade balance numbers. Fed's Bostic is due to be addressing monetary policy shortly after the BoE rate decision.