BRL: USD/BRL Slips Sharply Through Yesterday's Low on Tariff Exemptions

A new survey from I&C/TIPP has found that American voters, “seem to have a kind of love-hate relationship with Trump’s taxes imposed on imports, even as a means of encouraging more domestic production and shrinking the U.S. trade deficit.”

• Asked: “Do you support or oppose placing tariffs on foreign goods if the goal is to protect American jobs and industries?” “…a solid 53% of American adults said they either would “strongly support” (26%) or “somewhat support” (27%) tariffs on imports, if it protected jobs and industries. Of the remainder, 36% said they would either “strongly oppose” (19%) or “somewhat oppose” (17%) tariffs, while 11% were not sure.”
• TIPP notes: “Democrats showed only mild backing (36% support, 54% oppose) for tariffs to protect jobs and industries, compared to stronger backing from Republicans (75% support, 17% oppose) and independents (46% support, 38% oppose).”

Figure 1: Support or Oppose Tariffs on Foreign Imports if the Goal is to Protect American Jobs and Industries?

Source: I&C/TIPP

• Stocks are mildly higher in late Monday trade - holding to narrow ranges ahead of a heavy data (shortened) week. Markets are closed for the Independence Day holiday Friday, which draws the June employment release one day forward.
• Currently, the DJIA trades up 113.14 points (0.26%) at 43931.97, S&P E-Minis up 7 points (0.11%) at 6231, Nasdaq up 12.4 points (0.1%) at 20286.85.
• Stocks gained earlier after Canada withdrew plans to implement a digital tax on US tech companies economic advisor Kevin Hassett confirmed Monday - the tax had spurred Pres Trump to terminate trade talks late last Friday.
• Otherwise, "90 deals in 90 days" remains a tall order ahead the July 9 deadline, while Pres Trump floated the idea of keeping 25% tariffs on Japan’s cars as talks between the two nations continued with little more than a week to go before a slew of higher duties are set to kick in if a trade deal isn’t reached.
• Technology sector shares continued to lead gainers in late trade: Hewlett Packard Enterprise +11.65%, Juniper Networks +8.35%, First Solar +8.21%, Palantir Technologies +5.15%, Oracle Corp +4.59% and Arista Networks +3.53%.
• Conversely, Industrials - particularly stocks that dealt with alternative energy retreated Monday as Pres Trump's "Big" policy looks to withdraw clean energy initiatives: Ralliant Corp -8.25%, Fortive Corp -5.21%, Boeing -3.00%, Lamb Weston Holdings -2.88% and Albemarle Corp -2.71%.

• RES 4: 150.49 High Apr 2   
• RES 3: 149.28 High Apr 3
• RES 2: 148.65 High May 12 and a reversal trigger
• RES 1: 146.19/148.03 High Jun 24 / 23  
• PRICE: 144.16 @ 17:02 BST Jun 30
• SUP 1: 143.75 Low Jun 26  
• SUP 2: 142.80 Low Jun 13  
• SUP 3: 142.12 Low May 27 and a key short-term support  
• SUP 4: 141.96 76.4% retracement of the Apr 22 - May 12 upleg   

A bear threat in USDJPY remains present. The Jun 23 shooting star candle formation highlights a reversal of the recent recovery and price has traded through the 20- and 50-day EMAs. A clear break of the averages would strengthen a bearish threat and signal scope for an extension towards 142.12, the May 27 low and a key short-term support. On the upside, a move above 148.03, the Jun 23 high, would reinstate a bullish theme.