HUNGARY: Russian Oil Flow Set to Resume After Kyiv Strikes Interrupted Flow

• RES 4: 0.6700 76.4% retracement of the Sep 30 ‘24 - Apr 9 bear leg
• RES 3: 0.6688 High Nov 7 ‘24
• RES 2: 0.6603 High Nov 11 ‘24
• RES 1: 0.6595 High Jul 11 
• PRICE: 0.6527 @ 07:57 BST Jul 16
• SUP 1: 0.6508 Low Jul 15
• SUP 2: 0.6488/6373 50-day EMA / Low Jun 23 and a reversal trigger
• SUP 3: 0.6357 Low May 12
• SUP 4: 0.6275 Low Apr 14

The trend set-up in AUDUSD remains bullish and the latest pullback - for now - appears corrective. Resistance at 0.6590 has recently been pierced. A clear break of this price point would strengthen a bullish condition and confirm a resumption of the uptrend plus maintain the price sequence of higher highs and higher lows. Scope is seen for a climb towards 0.6603 next, the Nov 11 2024 high. Initial firm support to watch is 0.6488, the 50-day EMA.

While ASML’s headline Q2 earnings figures were generally firmer than expected, some soft Q3 guidance and a lack of firm guidance for ’26 seems to have weighed on wider sentiment, with Euro Stoxx 50 futures more than unwinding the initial uptick that followed the release.

• Broader European equity index futures point to downside at the cash open:
• Euro Stoxx 50 futures: -0.52%
• DAX futures: -0.56%
• CAC 40 futures: -0.38%
• FTSE MIB futures: -0.44%
• SMI futures: -0.02%
• FTSE 100 futures: -0.25% 

Hawkish adjustments in GBP STIRs following the firmer-than-expected CPI data.

• BoE-dated OIS 1-4bp less dovish as a result.
• BoE-dated OIS now shows just under 50bp of cuts through year-end after pricing as much as ~58bp of easing over that horizon in the wake of BoE Governor Bailey’s dovish weekend comments and a soft REC labour market release.
• Market still shows over 80% odds of a cut at the August MPC and fully discounts such a move through the September meeting.
• SONIA futures 0.5-5.0 lower. SFIZ5 has pierced but not cleanly broken its pre-existing July low, while SFIZ6 failed to pierce its own month-to-date low.
• Nothing of any real note from BoE Governor Bailey and Chancellor Reeves (outside of already leaked details) in the Mansion House addresses last night, which will leave focus on adjustments to the CPI release and any spill over from U.S. PPI data.