AUDUSD TECHS: Short-Term Gains Considered Corrective
- RES 4: 0.6865 High Feb 22
- RES 3: 0.6824 High Feb 24
- RES 2: 0.6784 High Mar 1
- RES 1: 0.6755 50-day EMA and a key resistance
- PRICE: 0.6703 @ 16:18 BST Mar 30
- SUP 1: 0.6625 Low Mar 24
- SUP 2: 0.6590 Low Mar 15
- SUP 3: 0.6565/47 Low Mar 10 / 61.8% of the Oct - Feb bull cycle
- SUP 4: 0.6500 Round number support
AUDUSD is consolidating. The trend condition is unchanged and the outlook remains bearish - recent gains, since Mar 10, appear to be a correction. The 20-day EMA has been breached but resistance at the 50-day EMA remains intact. The average intersects at 0.6755. A clear breach of it would signal scope for a stronger short-term recovery. Key support and the bear trigger lies at 0.6565, the Mar 10 low.
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USDJPY TECHS: Fades Off Highs
- RES 4: 138.17 High Dec 15 and a key resistance
- RES 3: 137.37.38 2.0% 10-dma envelope
- RES 2: 137.18 2.0% Upper Bollinger Band
- RES 1: 136.92 High Feb 28
- PRICE: 136.10 @ 16:27 GMT Feb 28
- SUP 1: 134.06 Low Feb 24
- SUP 2: 133.39 50-day EMA
- SUP 3: 133.25 Trendline drawn from the Feb 2 Low
- SUP 4: 131.52 Low Feb 14
USDJPY bulls remain in the driver’s seat despite the pair fading off highs into the Tuesday close. Price is through 136.67, the 38.2% retracement of the downleg between Oct 21 and Jan 16. The break of this level sets the scene for a climb towards 138.17, the Dec 15 high. On the downside, the support top watch lies at 133.27, the 50-day EMA. A clear break of this EMA is required to signal a possible reversal.
US: Trump Receives Bump After "America First" Announcement
Former President Donald Trump has seen his chances of winning the Republican Party presidential primary increasing following the announcement of "America First," his first significant policy announcement yesterday.
- According to bettor Smarkets, Trump received an 8% boost in implied probability of winning the primary following the announcement of his trade agenda.
- Trump’s proposed "America First" trade policy takes an ultra-hawkish line on China with new baseline tariffs, revoking China’s most favoured trading partner status, and additional measures on China’s industrial base designed to make the US, “a manufacturing powerhouse like the world has never seen before."
- Trump said: "Joe Biden claims to support American manufacturing, but in reality, he is pushing the same pro-China globalist agenda that ripped the industrial heart out of our country.”
- Trump: "Very simply, the Biden agenda taxes America to build up China. My agenda will tax China to build up America."
Figure 1: Republican Primary Election Winner (Smarkets)
US TSYS: Mulling Month End Extensions, Late Fed Speak: Goolsbee
- Tsys remain in modestly weaker territory, near top end of session range. Current focus on Chicago Fed President Goolsbee speaking at Ivy Tech Comm College (text, no Q&A) at 1430ET and month end.
- Bbg/Barclays month end extension est rather big at .12. One desk said they expected buying into 1600ET but related hedging "feels muted today".
- In-line with todays moves the desk posited the "vast majority of the selling will occur in the morning session, and then month-end extension buyers and rate lock unwinds will drive the price action (higher) in the afternoon."
