AUDUSD TECHS: Trend Outlook Remains Bearish
Oct-12 19:30
- RES 4: 0.6630 High Aug 2
- RES 3: 0.6616 High Aug 16
- RES 2: 0.6522 High Aug 30 and Sep 1, and the key resistance
- RES 1: 0.6445/6501 High Oct 11 / High Sep 29
- PRICE: 0.6334 @ 16:38 BST Oct 12
- SUP 1: 0.6287 2.00 proj of the Jun 16 - Jun 29 - Jul 13 price swing
- SUP 2: 0.6272 Low Nov 3 2022 and a key support
- SUP 3: 0.6215 2.236 proj of the Jun 16 - Jun 29 - Jul 13 price swing
- SUP 4: 0.6170 Low Oct 13 2022 and a key support
AUDUSD remains bearish following last week’s breach of support at 0.6331, despite the broad strength posted across the past three sessions. Last week’s break of support confirmed a range breakout and a resumption of the downtrend that started early February. This signals scope for 0.6215 next, a Fibonacci projection. On the upside, key trend resistance is at 0.6522, the Aug 30 and Sep 1 high. Short-term gains are considered corrective.
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US OUTLOOK/OPINION: GS See High 0.2 For Core CPI As Airfares Clash With Autos
Sep-12 19:27
- Goldman forecast US core CPI at 0.24% M/M (cons 0.2), reflecting a pullback in auto prices (used -3.1%, new -0.2%, mom sa) based on declines in used car auction prices and the further rebound in new car inventories and incentives.
- However, they expect a boost from residual seasonality in the transportation services categories, in particular for airlines (+6% mom sa; webfares also increased sequentially). CPI seasonal factors are likely overfitting to the rebound in prices in the aftermath of the pandemic lockdowns.
- They expect another gain in car insurance (+1.6%), as carriers continue to offset higher repair and replacement costs, and also see education prices rising 0.6% as tuitions for the new school year will begin flowing through and are likely to exceed the normal increases expected by the seasonal factors.
- Headline CPI seen at 0.63% M/M (3.58% Y/Y), reflecting higher energy (+5.8% M/M) and food (+0.3% M/M) prices.
US STOCKS: Late Equity Roundup: Oracle -14% Weighs on IT Sector
Sep-12 19:07
- Stocks are extending session lows in late trade, DJIA shares outperforming with the index near steady. Currently, S&P E-Mini futures are down 27.75 points (-0.61%) at 4512, Nasdaq down 143.7 points (-1%) at 13775.37, DJIA down 22.75 points (-0.07%) at 34642.39.
- Laggers: Information Technology, Communication Services and Consumer Discretionary sectors underperformed. Software and services shares weighed on IT while chip makers managed to keep their heads above water. Oracle down more than -14% now following a slight miss in first-quarter revenue estimates, Adobe -4.05%, Autodesk -3%. On the flipside, chip stocks managed some gains: Qualcomm +1.85%, SolarEdge +1.75%, both Intel and Micron +1.6%.
- Media and entertainment names weighed on Communication Services: META -1.85%, Netflix -1.35% while Warner Brothers lost -1.25%. Autos weighed on Consumer Discretionary, namely Tesla scaling back from Monday's rally, -2.25%. On the flipside, Ford gained +2.62%, GM +3%, Borg Warner +3.5%.
- Leaders: Bouncing back from Monday lows, Energy and Financials sectors outperformed. Oil and Gas names were buoyed by a strong rally in crude early Tuesday (WTI +1.62 at 88.91), leading gainers included: Occidental Petroleum +4.05%, Marathon +3.2%, Halliburton +3.0%.
- Meanwhile, Banks and Insurance names helped Financials outperform Industrials: Zion Bancorp +6.65%, PNC +5.5%, KeyCorp +5.3%, Wells Fargo +3.5% (on the flipside, Northern Trust -6.05% after Barclays conference presentation, Wells Fargo lowered price target to $90 from $100).
US: What To Watch In CPI: Whether Non-Used Car Core Goods Prices Can Fall Any Faster [2/2]
Sep-12 19:02
- The cycle in used car prices since the pandemic has embodied the supply chain pressures seen more broadly but it has also been amplified by some idiosyncratic aspects.
- Core goods excluding used cars meanwhile saw outright deflation in July for the first time since Feb’21, with -0.18% M/M after three months of 0.0%.
- Measures of supply chain pressures, which have increased off series lows according to the NY Fed’s GSCPI, imply only limited scope for faster deflation from here although it should continue adding a useful disinflationary impulse for the Fed.
