AUDUSD TECHS: Trading Closer To Its Recent Lows
- RES 4: 0.7202 High Jun 9
- RES 3: 0.7138 High Jun 10
- RES 2: 0.7069 High Jun 16 and a key short-term resistance
- RES 1: 0.6924/6964 20-day EMA / High Jun 28
- PRICE: 0.6838 @ 18:08 BST Jul 7
- SUP 1: 0.6762 Low Jul 5 / 6
- SUP 2: 0.6759 50.0% retracement of the Mar ‘20 - Feb ‘ 21 bull cycle
- SUP 3: 0.6685 High Mar 9 2020
- SUP 4: 0.6647 0.764 proj of the Apr 5 - May 12 - Jun 3 price swing
AUDUSD continues to trade closer to its recent lows. The pair remains vulnerable following the recent breach of 0.6829, the May 12 low. The break strengthens bearish conditions and confirms a resumption of the downtrend that started February 2021. The move lower also maintains a broader bearish price sequence of lower lows and lower highs. Sights are on 0.6759 next, a Fibonacci retracement. Initial firm resistance is seen at 0.6964, high Jun 28.
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AUDUSD TECHS: Remains Above Support
- RES 4: 0.7465 76.4% retracement of the Apr 5 - May 12 bear leg
- RES 3: 0.7400 Round number resistance
- RES 2: 0.7343 61.8% retracement of the Apr 5 - May 12 bear leg
- RES 1: 0.7283 High Jun 3 and the bull trigger
- PRICE: 0.7205 @ 15:40 BST Jun 7
- SUP 1: 0.7139/7036 20-day EMA / Low May 25
- SUP 2: 0.6950 Low May 18
- SUP 3: 0.6829 Low May 12 and the bear trigger
- SUP 4: 0.6805 Low Jun 22 2020
AUDUSD remains above 0.7139, the 20-day EMA. S/T conditions are bullish. The pair has traded above both the 20- and 50-day EMAs. This strengthens current conditions and signal scope for a climb towards 0.7343, a Fibonacci retracement. Note that the current bull cycle is still considered corrective. A break of the 20-day EMA would threaten the recent recovery. A stronger reversal would refocus attention on the bear trigger at 0.6829, May 12 low.
US: Late Corporate Credit Update: Risk Cools Late
Investment-grade corporate credit risk recedes back near late morning lows after the close as SPX emini futures, ESM2 rebound/extend highs: 4140.5 (+29.0).
- Investment grade risk measured by Markit's CDXIG5 index stands at 81.701 (-0.071) vs. 83.521H; CDXHY5 high yield index at 100.954 (+0.016).
- Outperforming credit sectors (tighter or least wide): Utilities and Energy both +0.03, followed by Industrials and Technology +0.5.
- Lagging sectors (wider or least narrow): Materials (+1.6), followed by Financials (subordinated) (+1.4) and communications, both +1.2.
US STOCKS: Late Equity Roundup: Finishing Strong
Stocks trading firmer heading into the FI close, near late session highs after trimming gains around midday w/ SPX emini futures ESM2 at 4149.25 (+28.0).
- SPX leading/lagging sectors: Energy sector continued to outperform (+2.84%) lead by O&G shares, while Industrials (+1.01%) outpaced Information Technology and Health Care both +0.90%. Laggers: Consumer Discretionary (-0.81%) as internet and direct marketing retailers remained weaker: Etsy -3.88% at 80.58, Amazon -2.28% at 121.94, Ebay -0.61% at 47.38.
- DJIA +185.29 (0.56%) at 33103.93; Nasdaq +89.3 (0.7%) at 12151.64.
- Dow Industrials Leaders/Laggers: United Health Care leads (UNH) +4.20 at 494.38, cloud-based software company Salesforce.com remains strong +4.11 at 186.98 followed by Chevron (CVX) +3.30 at 180.13 as crude rebounds. Laggers: Home Depot (HD) remains weak but off lows at 299.02 (-4.87), Walmart (WMT) -1.80 at 123.07.
