OUTLOOK: Price Signal Summary - USDJPY Bulls Remain In The Driver's Seat
Jul-16 10:40
- In FX, a corrective cycle in EURUSD remains in play and the pair traded lower Tuesday. Support at the 20-day EMA, at 1.1655, has been cleared. This shifts the focus to the 50-day EMA, at 1.1505. A clear break of the average is required to highlight a stronger reversal. For now, the move down appears corrective and trend signals continue to highlight a dominant uptrend. A resumption of gains would open 1.1829, the Jul 1 high and a bull trigger.
- A short-term bear cycle in GBPUSD remains in place and this week’s move down reinforces current bearish conditions. The pair has breached both 20- and 50-day EMAs. Yesterday’s move down resulted in a break of trendline support at 1.3440. The trendline is drawn from the Jan 13 low and the breach strengthens a bearish threat, exposing 1.3371 initially, the Jun 23 low. Initial firm resistance to watch is 1.3555, the 20-day EMA.
- A short-term bull cycle in USDJPY remains firmly in place and this week’s gains reinforce current conditions. The latest rally has resulted in a breach of resistance at 148.03, the Jun 23 high, and a move through key resistance at 148.65, the May 12 high. Clearance of both levels strengthens the bull theme and opens 149.38, 50.0% of the Jan 10 - Apr 22 bear leg. On the downside, support to watch is 145.44, the 50-day EMA.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
GILT TECHS: (U5) Unwinding An Overbought Condition
Jun-16 10:37
- RES 4: 94.15 2.000 proj of the May 22 - 27 - 29 price swing
- RES 3: 94.00 Round number resistance
- RES 2: 93.73 1.764 proj of the May 22 - 27 - 29 price swing
- RES 1: 92.95./93.68 50.0% of Jun 13 - 16 downleg / High Jun 13
- PRICE: 92.59 @ 11:26 BST Jun 16
- SUP 1: 92.23 Intraday low
- SUP 2: 92.04 20-day EMA
- SUP 3: 91.56 Low Jun 9
- SUP 4: 91.44 Low Jun 8
A bullish condition is Gilt futures remains intact and Friday’s steep sell-off from the session high is for now, considered corrective. The move higher last week marks an extension of the recent breach of resistance at 91.87, the May 20 high. This signals scope for a test of 93.73, a Fibonacci projection point. Note the uptrend is in overbought territory, a deeper pullback would unwind this position. First firm support lies at 92.04, the 20-day EMA.
US TSY FUTURES: CFTC Shows A Managers & Leveraged Funds Trimming Net Exposure
Jun-16 10:34
The latest CFTC CoT report revealed cover of prevailing curve-wide positions amongst asset managers and leveraged funds in the week ending Tuesday June 10.
- Asset managers added to net longs in TU, UXY and WN futures, while trimming net longs in FV, TY & US futures. The cohort trimmed its curve-wide net long by ~$1.0mln DV01 but remains net long in all contracts.
- Leveraged funds covered some of their net short in TY, US & WN futures, while they extended net shorts in TU, FV & UXY contracts. The cohort trimmed its curve-wide net short by ~$4.2mln DV01 but remains net short in all contracts.
- The non-commercial cohort added to net shorts in TU, FV & TY futures, while they trimmed net shorts in UXY, US & WN futures. The cohort remains net short across the curve (more detail for that cohort available in the table below).
- Note that the cut off date means that initial reaction to the CPI data was captured, although PPI & UoM reaction was not.
- The data doesn’t capture the Israel-Iran developments later in the week.
Source: MNI - Market News/CFTC/Bloomberg Finance L.P.
LOOK AHEAD: Monday Data Calendar: Empire Mfg, 20Y Bond Auction Re-Open
Jun-16 10:32
- US Data/Speaker Calendar (prior, estimate)
- 16-Jun 0830 Empire Manufacturing (-9.2, -6.3)
- 16-Jun 1130 US Tsy $76B 13W & $68B 26W bill auctions
- 16-Jun 1300 US Tsy $13B 20Y Bond auction re-open (912810UL0)
- Source: Bloomberg Finance L.P. / MNI
