US: Trump Says US Would Be "Dead" w/o Tariffs As Court Case To Start
Jul-31 11:04
President Donald Trump posts on Truth Social: "To all of my great lawyers who have fought so hard to save our Country, good luck in America’s big case today. If our Country was not able to protect itself by using TARIFFS AGAINST TARIFFS, WE WOULD BE “DEAD,” WITH NO CHANCE OF SURVIVAL OR SUCCESS. Thank you for your attention to this matter!"
- Trump is referring to a court case getting underway in New York City at 10:00ET (15:00BST, 16:00CET), in which 11 judges will hear 45 mins of arguments from the Trump administration and two small businesses that argue the president's tariff regime is illegal. The firms argue that Trump's use of the International Emergency Economic Powers Act of 1977 to impose tariffs without congressional approval was in breach of the law's standards.
- As NBC reports, "The Court of International Trade initially blocked the tariffs in late May. It found that the import duties lacked “any identifiable limits” and that the law Trump cited in many of his executive orders did not “delegate an unbounded tariff authority to the President.” It also said the tariffs did not meet the test of an “unusual and extraordinary” risk to the country."
- If the court finds against the Trump administration, this does not mean an end to the tariff drive. Tariffs on steel and aluminium have been imposed under other laws. Utilising other legislation, such as Section 301 of the 1974 US Trade Act, Section 232 of the 1962 trade law, or Section 338 of the Trade Act of 1930, may all provide avenues should the court rule against the administration.
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FOREX: Swiss Franc Outperforms, EURCHF Re-Approaching 0.9300
Jul-01 11:01
- With more of a focus on rate differentials returning to currency markets, the main beneficiaries of Tuesday’s extension of dollar weakness have been the low yielding JPY and CHF. While USDCHF continues to broadly mirror the performance of the dollar index, spot references below 0.7900 are notable, as the pair continues to trade at the lowest level since the removal of the EURCHF floor in 2015. The next technical target is 0.7827 - 1.618 projection of the May 1 - Sep 6 '24 - Jan 13 price swing.
- Dollar aside, levels for Cross/CHF are also worth flagging given the likes of CHFJPY traded to a fresh record high of 181.84 on Monday, and posted a 3.64% advance in June. Additionally, while EURCHF continues to broadly respect its well-established 0.9300-0.9430 range across the last two months, today’s 0.38% decline sees spot re-approaching the lower bound. A close below the 0.93 handle would certainly renew the focus on the key double bottom support, located around 0.9210. In similar vein, GBPCHF has traded to a two-month low this morning at 1.0850.
- Analysts have been citing the continued tailwind for the Franc from the strengthened relationship to the Euro and the notable outperformance despite an easing in geopolitical tensions. Some have cited there remain multiple paths to further CHF appreciation near-term, even against a potential backdrop of negative rates.
OUTLOOK: Price Signal Summary - WTI Bear Threat Remains Present
Jul-01 11:01
- On the commodity front, Gold traded lower Friday resulting in a breach of the 50-day EMA, and a trendline drawn from the Dec 30 ‘24 low. A clear break of both support points would signal scope for a deeper correction - this would expose $3245.5, the May 29 low. The metal has recovered from yesterday’s low and for now, this highlights a possible false trendline break. Stronger gains would refocus attention $3451.3, Jun 16 high. The bear trigger is $3248.7, the Jun 30 low.
- In the oil space, WTI futures maintain a softer tone following the reversal from the Jun 23 high. Support to watch is at the 50-day EMA, at $64.60. It has been pierced, a clear break of it would signal scope for a deeper retracement. This would expose $58.87, the May 30 low. On the upside, initial resistance to watch is $71.20, the 50.0% retracement of the Jun 23 - 24 high-low range. Key resistance is at $78.40, the Jun 23 high.
OIL: WTI is extending gains towards $66.00
Jul-01 10:58
- A new intraday high for WTI, but zooming out of the chart the Commodity still trades well within the $64.54/$66.42 (low/High) range seen in the past 4 sessions.
- WTI is so far finding some resistance ahead of $66.00, but initial resistance will be at the top of that short term range.
