EURUSD TECHS: Watching Resistance

• RES 4: 1.2908 1.382 proj of the Apr 22 - May 3 - 9 price swing
• RES 3: 1.2894 High Mar 8 and a key resistance
• RES 2: 1.2859 1.236 proj of the Apr 22 - May 3 - 9 price swing
• RES 1: 1.2801/03 High May 29 / High Mar 21
• PRICE: 1.2743 @ 05:58 BST Jun 3
• SUP 1: 1.2672/1.2627 20- and 50-day EMA values
• SUP 2: 1.2510 Low May 14
• SUP 3: 1.2446 Low May 9 and a key near-term support
• SUP 4: 1.2423 Low Apr 24

The trend condition in GBPUSD remains bullish and the pair has recovered from last Thursday’s low of 1.2681. A resumption of gains would open 1.2803, the Mar 21 high and 1.2859, a Fibonacci projection. Moving average studies are in a bull-mode set-up, highlighting an uptrend. Key support levels to watch are 1.2672, the 20-day EMA and 1.2627, the 50-day EMA. A clear break of these averages would signal scope for a deeper retracement.

Asian stocks are higher today, after softer reading of the Federal Reserve’s preferred inflation measure bolstered hopes for rate cuts. Equities in Australia, Japan, and Hong Kong advanced. Indian equities surged following election results indicating a victory for Prime Minister Narendra Modi’s party in a landslide while positive property numbers out of China have also helped boost stocks today. The recent decline of the US dollar, down 1.1% in May, also supported gains. On the data front we have had regional PMIs, AU MI Inflation and Indonesian CPI.

• Japanese equities are higher today. Japan's Topix is 0.95% higher and is now trading near a two-month highs, driven by renewed expectations for US interest-rate cuts, which boosted investor appetite for riskier assets. Sony Group has contributed the most to the Topix gain, with high domestic bond yields particularly benefited banking stocks such as Mitsubishi UFJ and Sumitomo Mitsui, the Topix Bank Index is up 1.46% while the Nikkei also advanced 1.15%. Earlier Capital spending for 1Q was 6.8% vs 11% est, while Jibun Bank PMI was 50.4 vs 50.5 prior.
• Taiwan equities have surged higher today, TSMC has contributed the most the index gain up 3.41% after Nvidia announced plans for new chips. Earlier, S&P PMI manufacturing was up in May to 50.9 from 50.2. The Taiex is up 1.76%.
• South Korean equities have surged higher today as chip and auto names lead the way. Earlier, S&P Manufacturing PMI increased in May to 51.6 vs 49.4 in Apr. The Kospi is up 1.87% and is now testing the 50-day EMA, while the Kosdaq lags moves however still trades up 0.51%.
• Australian equities are on track for their 2nd straight day of gains, led by Utilities and energy stocks. Earlier, we had Judo Bank PMI coming in at 49.7 vs 49.6 prior and MI Inflation for May was 0.3% vs 0.1% in April. The ASX200 is 0.79% higher.
• Elsewhere in SEA, Indian equities have surged on the back of the election results with the Nifity 50 up 2.90%, Indonesian equities are 1.36% higher, Singapore equities are 0.42% and Philippines equities are 0.60% higher.

• RES 4: 117.880 High Apr 15
• RES 2: 117.620 High Apr 19
• RES 3: 116.993/117.440 High 50-day EMA / High May 16
• RES 1: 116.470 20-day EMA
• PRICE: 115.930 @ 05:37 BST Jun 3
• SUP 1: 115.600 Low May 31
• SUP 2: 115.410 2.00 proj of the Mar 8 - 18 - 27 price swing
• SUP 3: 115.250 Low Oct 23 2023 (cont)
• SUP 4: 115.130 Low Oct 19 2023 (cont)

A downtrend in Bobl futures remains intact and last week’s extension lower reinforces current conditions. The move down confirms a resumption of the downtrend and maintains the price sequence of lower lows and lower highs. This opens 115.410 next, a Fibonacci projection. On the upside, initial firm resistance is seen at 116.470, the 20-day EMA. Key resistance and the reversal trigger is at 117.440, the May 16 high.