USDJPY TECHS: Turns Lower
- RES 4: 152.31 High Feb 19
- RES 3: 151.62 61.8% retracement of the Jan 10 - Apr 22 bear leg
- RES 2: 151.21 High Mar 28
- RES 1: 150.92 High Aug 1
- PRICE: 146.49 @ 08:47 BST Aug 14
- SUP 1: 146.21 Low Aug 14
- SUP 2: 145.94/86 1.0% 10-dma envelope / Low Jul 24
- SUP 3: 145.53 100-dma
- SUP 4: 145.40 50% retracement Apr - Aug Upleg
USDJPY has turned lower, ending the consolidation phase that dictated play last week. Weakness today puts the price through support drawn off the early August lows as well as 146.71, a key retracement. Price action this week marks a full reversal of the previously overbought condition, keeping the downside argument in focus. The inability of markets to build a base above the 20-day EMA was also a concern and opens 145.86-94 support. A break of last week’s 150.92 high would resume the uptrend.
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US TSY FUTURES: FV/US Flattener Blocked
Latest block trades lodged at 08:36:12 London/03:36:12 NY:
- FVU5 7.9K lots blocked 108-03.25, looks like a seller.
- USU5 2.5K lots blocked at 112-25, looks like a buyer.
- DV01 ~$340K.
NOK: Early Underperformance Fades; Jul 2 High Important Resistance In EURNOK
Early NOK underperformance has faded a little, with yesterday’s 11.8792 high containing topside in EURNOK for now. Through July, the cross has consolidated the ~4% rise seen following Norges Bank’s surprise 25bp cut on June 19. This has allowed an overbought condition to unwind, providing a more favourable technical backdrop for those expecting NOK weakness to continue. Initial resistance is the July 2 high at 11.9156, clearance of which would expose the psychological 12.0000 handle.
- Our commodities team highlight that oil is lower on Tuesday, having begun its reversal on Monday as Trump threats towards Russian sanctions were offered a 50-day deadline – easing any fears of short-term disruption.
- Note that this week’s Norwegian macro calendar is very light, leaving cross-asset dynamics at the fore for NOK FX and rates.
BONDS: Rally Extends
Not seeing any headlines as the bid extends and flows pick up.
