BOE: VIEW CHANGE: MS remove September cut; still look for 2.75% terminal

• RES 4: $39.026 - 1.382 proj of the Apr 7 - 25 - May 15 price swing 
• RES 3: $38.246 - 1.236 proj of the Apr 7 - 25 - May 15 price swing
• RES 2: $38.000 - Round number resistance 
• RES 1: $37.317 - Intraday high  
• PRICE: $37.220 @ 08:13 BST Jun 18 
• SUP 1: $34.184 - 20-day EMA
• SUP 2: $33.970/31.651 - 50-day EMA / Low May 15
• SUP 3: $30.915/28.351 - Low Apr 11 / 7 and the bear trigger  
• SUP 4: $27.686 - Low Sep 6 ‘24  

A bull wave in Silver remains in play and Tuesday’s fresh cycle high, reinforces this condition. The metal has recently traded through a resistance at $34.903, the Oct 23 ‘24 high and a key bull trigger. The clear break of it marks an important medium-term bullish development. Sights are on the $38.00 handle next. On the downside, initial support to watch lies at $34.184, the 20-day EMA.

The Riksbank decision is due at 0830BST/0930CET. With consensus leaning heavily towards a 25bp rate cut to 2.00%, focus will be on the policy statement guidance and June MPR rate path projection.

• MNI’s full Riksbank preview is here.
• Developments since March support a downward revision to the rate path from its current flat 2.25% level, but we don’t expect the path to move much below 2.00%. It’s still too early for the Executive Board to signal a material chance of a cut to 1.75% in the baseline projection – the June MPR alternative scenarios are best placed to incorporate a dovish pivot of that nature.
• If the rate path troughs at 2.00% and the policy statement is ambiguous on the chances of further easing, there may be modest hawkish risks to the SEK intraday.
• Initial support in EURSEK is last Thursday’s low 10.9033, which may be at risk if the hawkish conditions noted above are realised. Firm support is then seen at 10.7941, the April 4 low.
• A dovish outcome would see the baseline rate path incorporate a meaningful risk of a cut to 1.75% in Q3. 

• RES 4: 1.4200 Round number resistance
• RES 3: 1.4111 High Apr 4
• RES 2: 1.3843/1.4016 50-day EMA / High May 12 and 13
• RES 1: 1.3713 20-day EMA
• PRICE: 1.3652 @ 08:05 BST Jun 18
• SUP 1: 1.3540/3517 Low Jun 16 / 1.0% 10-dma envelope
• SUP 2: 1.3503 1.618 proj of the Feb 3 - 14 - Mar 4 price swing
• SUP 3: 1.3473 Low Oct 2 2024
• SUP 4: 1.3410 1.764 proj of the Feb 3 - 14 - Mar 4 price swing

The trend needle in USDCAD points south and fresh cycle lows last week and again on Monday, reinforce a bearish theme. Short-term gains are considered corrective. Support at 1.3686, the May 26 low and a bear trigger, has been cleared, confirming a resumption of the downtrend. This maintains the price sequence of lower lows and lower highs. Sights are on 1.3517 next, envelope-based support. Resistance at the 20-day EMA is at 1.3713.