EURJPY TECHS: Outlook Remains Bullish
- RES 4: 159.92 2.236 proj of the May 11 - 29 - 31 price swing
- RES 3: 158.72 2.00 proj of the May 11 - 29 - 31 price swing
- RES 2: 158.05 High Jul 21 and the bull trigger
- RES 1: 157.50 High Aug 2
- PRICE: 156.20 @ 15:46 BST Aug 4
- SUP 1: 155.54 Low Aug 3
- SUP 2: 154.25 50-day EMA
- SUP 3: 151.42 Low Jul 28 and key support
- SUP 4: 150.16 38.2% retracement of the Jan 3 - Jul 21 bull cycle
Short-term conditions in EURJPY remain bullish. The latest rally highlights the end of a corrective cycle between Jul 21 - 28. A continuation higher would expose 158.05, the Jul 21 high and a bull trigger. Clearance of this level would confirm a resumption of the medium-term uptrend that would open 158.72, a Fibonacci projection. Key support is at 151.42, the Jul 28 low. Initial firm support is at 154.25, the 50-day EMA.
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EURJPY TECHS: Holding On To Its Recent Gains
- RES 4: 160.27 2.0% 10-dma envelope
- RES 3: 159.92 2.236 proj of the May 11 - 29 - 31 price swing
- RES 2: 158.72 2.00 proj of the May 11 - 29 - 31 price swing
- RES 1: 158.00 High Jun 28
- PRICE: 157.18 @ 16:15 BST Jul 5
- SUP 1: 155.09/06 20-day EMA / Low Jun 23
- SUP 2: 154.05 Low Jun 20
- SUP 3: 153.09 Low Jun 16
- SUP 4: 151.89 50-day EMA
EURJPY maintains a bullish tone as the cross consolidates at its recent highs. Recent gains reinforce a bullish theme and maintain the price sequence of higher highs and higher lows. Note that moving average studies are in a bull mode position too, highlighting positive market sentiment. The focus is on 158.72, a Fibonacci projection. Initial key support is at 155.06, the Jun 23 low.
US STOCKS: Late Equity Roundup: Defensive Utility Shares Take Lead
- Stocks trading mildly weaker, well off early session lows as focus turns from an uninspiring June FOMC minutes release to employment data culminating with Friday's NFP. At the moment, S&P E-Mini Future down 6.75 points (-0.15%) at 4485.25, DJIA down 132.8 points (-0.39%) at 34285.9, Nasdaq down 11.9 points (-0.1%) at 13804.76.
- Leading gainers: Utilities have taken the lead in late trade followed by Communication Services and Real Estate sector shares as support for Information Technology shares ebbs. As to Utilities, independent power and renewable energy stocks rallied late: PG&E +3.6%, Consolidated Edison +2.3%, NRG Energy +2.0%. Media and entertainment shares continued to buoy Communication Services with Meta gaining 3.45%, Google +1.9%, Netflix +0.9% (GS upgraded shares as subscriber numbers increase).
- Laggers: Materials, Energy and Industrials underperformed in the first half, metals and mining stocks weaker (Gold trading -9.2 at 1916.28 late).
- The technical/bull theme in S&P E-minis remains intact despite today’s pullback. Last Friday’s gains reinforce a bullish condition. The contract has pierced key resistance and the bull trigger at 4493.75, the Jun 16 high.
- A clear break of this level would confirm a resumption of the uptrend and pave the way for a climb towards 4532.08, a Fibonacci projection. On the downside, key trend support has been defined at 4368.50, the Jun 26 low.
US: California Gov Newsom Rises Slightly As 2024 Presidential Prospect
Bookmakers are seeing the prospect of California Governor Gavin Newsom (D-CA) taking the 2024 Democrat presidential nomination rise slightly as questions continue to persist over President Biden's age and the suitability of Vice President Kamala Harris to take over the presidency should Biden be incapacitated while in office.
- According to data from Smarkets, Newsom's implied probability of taking the nomination has increased from around 3% to around 13% over the past month.
- This week Newsom has been on a tour of Republican controlled states, ostensibly throwing his support behind President Biden, but also burnishing his own credentials as a presidential candidate.
- Politico notes that Newsom's tour is likely a win-win for both Biden and Newsom, adding that the White House "could use more and younger voices touting Biden’s record, particularly around the economy," particularly Newsom's "more aggressive brand of politics."
- Newsom has repeatedly ruled himself out of a primary contest against Biden and he remains an outsider, but if Biden's approval rating fails to strengthen over the coming months there may be louder voices calling for an alternative Democrat nominee.
Figure 1: 2024 Democratic Presidential Nominee
Source: Smarkets
