EURUSD TECHS: Recent Gains Considered Corrective

• RES 4: 0.8747 76.4% retracement of the Feb 27 - Mar 16 bear leg
• RES 3: 0.8742 High Mar 31 and Apr 1 and a bull trigger
• RES 2: 0.8731 High May 18 
• RES 1: 0.8660/82 50-day EMA / High May 29
• PRICE: 0.8631 @ 16:33 BST Jun 12
• SUP 1: 0.8620/18 Low Jun 10 / Low May 25
• SUP 2: 0.8610 Low Mar 16 and the bear trigger
• SUP 3: 0.8597 Low Aug 14 ‘25
• SUP 4: 0.8576 Low Jul 2 ‘25  

Trend signals in EURGBP are unchanged, they remain bearish and S/T gains are - for now - considered corrective. Sights are on key support at 0.8610, the Mar 16 low. Clearance of this level would highlight an important medium-term bearish breakout. Key resistance to watch is 0.8742, the Mar 31 and Apr 1 high. Initial firm resistance is 0.8660, the 50-day EMA, recently pierced. A clear break of this average would highlight a short-term bullish development.      

There has been little reaction to recent Iran-related headlines continuing to point to progress towards a US-Iran deal. Comments from Pakistan PM Sharif, Axios reporting and a US official have all broadly chimed with Iran’s Araghchi earlier on starting the MOU has “never been closer” which had a greater reaction as it helped Treasuries off lows. TYU6 is currently at levels very close to those seen after the initial reaction to yesterday’s post from President Trump cancelling the planned strikes on Iran. 

• TYU6 trades at 109-18 (-03+) off pre-Araghchi lows of 109-12 although remains off the day’s earlier highs of 109-29.
• That earlier high marked a fresh extension towards resistance at 110-01+ (50-day EMA), after which lies 110-14 (38.2% retrace of Mar 2 - May 19 bear leg).
• Initial firm support meanwhile lies at 108-25 (Jun 8 low) having moved further away from the bear trigger at 108-08+ (May 19 low) with yesterday’s sharp rally on the Iran strike cancellation.
• Cash yields are 1-1.5bp higher on the day.
• FF cumulative hikes from 3.62% effective: 0.5bp Jun, 2bp Jul, 8bp Sep, 10.5bp Oct, 19.5bp Dec, 24bp Jan 2027, 30bp Mar, 33bp Apr and 33bp Jun.
• SOFR futures are up to 2 ticks lower on the day in the greens, whilst the implied peak yield of 4.00% (M7) is near unchanged on the day after yesterday's 7bp decline. It compares with a Iran conflict high of ~4.15%. 

AP-NORC has published analysis of '21 waves of surveys' that finds, “President Trump’s support among independents has eroded significantly, falling seventeen points from what it was before he took office… In contrast, Republican and Democratic support has remained largely stable during the same time period…”

• The report notes, “survey waves were blocked into five time periods corresponding to: the 2024 election and pre-presidency period (July 2024–January 2025); President Trump’s first 100 days in office (March–May 2025); the period when the One Big Beautiful Bill was passed (June–August 2025); the period of the longest government shutdown in U.S. history (September–December 2025); and January 8–April 20, 2026, a period of domestic ICE-enforcement crackdowns as well as international actions by Trump including the start of the Iran war.”

Figure 1: % of U.S. adults who approve of Trump’s job as President 

Source: AP-NORC