AUDUSD TECHS: Sell-Off Exposes Key Support
- RES 4: 0.7400 Round number resistance
- RES 3: 0.7343 61.8% retracement of the Apr 5 - May 12 bear leg
- RES 2: 0.7161/7283 50-day EMA / High Jun 3 and the bull trigger
- RES 1: 0.7063 High Jun 13
- PRICE: 0.6934 @ 16:31 BST Jun 13
- SUP 1: 0.6912 Low Jun 13 3.0% 10-dma envelope
- SUP 2: 0.6873 Low May 16
- SUP 3: 0.6829 Low May 12 and the bear trigger
- SUP 4: 0.6805 Low Jun 22 2020
AUDUSD traded sharply lower Monday, reinforcing the bearish significance of the latest reversal and failure to remain above the 50-day EMA. The pace of the sell-off saw the pair show below the 3.0% 10-dma envelope indicator for the first time since the onset of the COVID pandemic in 2020. This further threatens the recent bullish price structure and attention is on 0.6829, the May 12 low and bear trigger. Key S/T resistance has been defined at 0.7283.
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USDCAD TECHS: Bullish Outlook
- RES 4: 1.3173 High Nov 13 2020
- RES 3: 1.3168 2.0% 10-dma envelope
- RES 2: 1.3091 High Nov 24 2020
- RES 1: 1.3077 High May 12
- PRICE: 1.2933 @ 16:46 BST May 13
- SUP 1: 1.2914/2814 High May 2 / Low May 6
- SUP 2: 1.2737/14 50-day EMA / Low May 5 and a key support
- SUP 3: 1.2568 Low Apr 22
- SUP 4: 1.2459 Low Apr 21
USDCAD faded off the week’s highs into the close of the week, although the outlook remains bullish. Recent gains have resulted in a breach of 1.2914, May 2 high, and key resistance at 1.2964, the Dec 20 2021 high. The break of the latter marks an important medium-term bullish technical development and reinforces the positive outlook. This has opened 1.3168 next, the upper band of a MA envelope. Initial support is at 1.2914. Key support lies at 1.2714, Apr 29 low.
US TSYS: Risk-On AS Mkt Takes Adaptive Fed Seriously?
FI markets traded weaker after the bell -- 30Y Bond around upper half of the week's range but well off Thursday's highs. Little react to morning data (import prices lower than exp at +0.0%; U/Mich sentiment 59.1 vs 64 est, "lowest reading since 2013").
- Tsy 30Y Bond futures holding to narrow channel on the way down (30YY taps 3.0959 high vs. 2.9531% early Thu), curves bear steepening: 2s10s +5.017 at 33.449, 5s10s +2.367 at 4.881.
- Rates under pressure w/ focus back on Fed policy after Fed Chair Powell said he's prepared to consider larger than 50bp hikes in Marketplace interview late Thu (after downplaying 75bp moves at his press conference last week), as the committee adapts to "incoming data and the evolving outlook".
- Not that the correlation is a factor these days, but Equities did have a nice rebound on the day, SPX emini futures +99.0 at 4026.25.
- Commodities: WTI Crude Oil (front-month) holding strong +4.05 at $110.18; Gold weaker at $1807.95 -13.77.
- Next Monday Data Calendar:
- Empire Manufacturing (24.6, 15) at 0830ET
- NY Fed Williams moderated discussion, no text at 0855ET
- US Tsy $45B 13W, $42B 26W bill auctions at 1130ET
- Net Long-term TIC Flows ($141.7B, --) Net TIC Flows ($162.6B, --) at 1600ET
US: US-ASEAN Summit Concludes
The final event of the US-ASEAN summit, an exchange of views on regional and global issues, has concluded. US President Joe Biden and the Southeast Asian leaders will appear at a White House joint press event shortly.
- A livestream of the event is available here: https://www.youtube.com/watch?v=SpZz2944dmU
