AUDUSD TECHS: Northbound
- RES 4: 0.7200 Round number resistance
- RES 3: 0.7137 High Aug 11
- RES 2: 0.7063 High Jan 18
- RES 1: 0.7059 2.236 proj of the Oct 13 - 27 - Nov 3 price swing
- PRICE: 0.6984 @ 16:54 GMT Jan 18
- SUP 1: 0.6930/6860 Low Jan 17 / 9
- SUP 2: 0.6854 20-day EMA
- SUP 3: 0.6762 50-day EMA
- SUP 4: 0.6688 Low Jan 3 and key support
AUDUSD maintains a bullish theme and traded higher Wednesday before a moderation into the close. The pair has recently cleared 0.6893, the Dec 13 high and this confirmed a resumption of the uptrend that started Oct 13. The move higher maintains the bullish price sequence of higher highs and higher lows and note that moving average studies are in a bull mode position. The focus is on 0.7059 next, a Fibonacci projection. Key support lies at 0.6688, Jan 3 low.
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AUDUSD TECHS: Strong Reversal Highlights S/T Top
- RES 4: 0.6976 2.00 proj of the Oct 13 - 27 - Nov 3 price swing
- RES 3: 0.6956 High Aug 30
- RES 2: 0.6909 76.4% retracement of the Aug 11 - Oct 13 downleg
- RES 1: 0.6893 High Dec 13 and the bull trigger
- PRICE: 0.6712 @ 17:06 GMT Dec 19
- SUP 1: 0.6676 Low Dec 16
- SUP 2: 0.6660/6585 50-day EMA / Low Nov 21
- SUP 3: 0.6387 Low Nov 10
- SUP 4: 0.6272 Low Nov 3 and a key support
A sharp sell-off in AUDUSD last Thursday signals a short-term top and suggests scope for a deeper pullback near-term. The 20-day EMA has been breached and attention turns to the 50-day EMA at 0.6660. This represents a key short-term support and a break would suggest potential for a deeper retracement. On the upside, key resistance has been defined at 0.6893, the Dec 13 high. A break would resume the recent uptrend.
US TSYS: Tsys Reverse Friday's Optimism
Tsy futures broadly weaker after the close but off midday lows when 30YY tapped 3.6553% high. Light holiday volumes w/ TYH just over 700k after the close. Yield curves steeper (2s10s +2.604 at-67.630 vs. -64.130 high) but off early session highs amid orderly selling across the board.
- No real catalyst to the move, Tsys initially followed Bunds and Gilts lower early in the first half. Underlying weakness most likely unwinds of last Fri's rally despite the hawkish Fed speak from SF Fed Daly and Cleveland Fed Mester.
- Large 10Y Block sale (-10,120 TYH3 at 114-00, was well through the session low of 114-02.5 at the time (1105:00ET).
- No scheduled Fed speakers today, no react to slightly better than expexted NAHB Housing Market Index (36 vs. 34 est).
- Data picks up Tuesday w/ Building Permits (1.512M rev, 1.499M); MoM (-3.3% rev, -0.9%) and Housing Starts (1.425M, 1.404M); MoM (-4.2%, -1.5%) at 0830ET.
- Christmas holiday hours update:
- Trading floor closes at 1300ET while Globex close runs to 1600ET. Monday, Dec 26 is a full close w/ Globex reopening 1700ET
- Link to CME for reference
EURJPY TECHS: Bull Cycle Intact Despite The Latest Pullback
- RES 4: 148.40 High Oct 21 and a key resistance
- RES 3: 147.75 High Oct 31
- RES 2: 147.10 High Nov 9
- RES 1: 146.73 High Dec 15
- PRICE: 145.38 @ 17:05 GMT Dec 19
- SUP 1: 143.96/82 Former trendline resistance / Intraday low
- SUP 2: 143.10 Low Dec 6
- SUP 3: 140.77 Low Dec 2 and the bear trigger
- SUP 4: 140.00 76.4% retracement of the Sep 26 - Oct 21 bull leg
EURJPY resumed its uptrend last Thursday but has since pulled back. The outlook remains bullish despite the latest move lower. Last week’s gains resulted in a break of trendline resistance drawn from the Oct 21 high. The trendline intersects at 143.96 and represents support. A resumption of gains would refocus attention on the bull trigger at 146.73, the Dec 15 high. A clear break of support at 143.96 would instead be a bearish development.
