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Daily Pivots: (S1) 0.7351; (P) 0.7372; (R1) 0.7400; More...

Intraday bias in AUD/USD is turned neutral again s with the current recovery. On the upside, break of 0.7408 minor resistance will indicate short term bottoming. In this case, stronger recovery could be seen to 4 hour 55 EMA (now at 0.7456) and above. But upside should be limited well below 0.7676 resistance to bring fall resumption. On the downside, break of 0.7346 will extend recent fall from 0.8135 to 0.7328 cluster support (61.8% retracement of 0.6826 to 0.8135 at 0.7326). Firm break of 0.7382 will target 61.8% projection of 0.8135 to 0.7411 from 0.7676 at 0.7229 next.

In the bigger picture, medium term rebound from 0.6826 is seen as a corrective move. Prior break of 0.7500 key support suggests that such correction is completed at 0.8135. Deeper decline would be seen back to retest 0.6826 low. In case of another rise, we'd expect strong resistance from 38.2% retracement of 1.1079 to 0.6826 at 0.8451 to limit upside to bring long term down trend resumption eventually.

For the 24 hours to 23:00 GMT, the USD rose 0.05% against the CAD and closed at 1.3316.

In the Asian session, at GMT0300, the pair is trading at 1.3307, with the USD trading 0.07% lower against the CAD from yesterday’s close.

The pair is expected to find support at 1.3283, and a fall through could take it to the next support level of 1.3259. The pair is expected to find its first resistance at 1.3333, and a rise through could take it to the next resistance level of 1.3359.

Looking forward, investors would keep an eye on Canada’s crucial inflation figures for May and retail sales data for April, scheduled to release later in the day.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the AUD rose 0.11% against the USD and closed at 0.7379.

LME Copper prices declined 0.26% or $18.0/MT to $6801.0/MT. Aluminium prices declined 0.55% or $12.0/MT to $2167.0/MT.

In the Asian session, at GMT0300, the pair is trading at 0.7389, with the AUD trading 0.14% higher against the USD from yesterday’s close.

The pair is expected to find support at 0.7359, and a fall through could take it to the next support level of 0.7328. The pair is expected to find its first resistance at 0.7407, and a rise through could take it to the next resistance level of 0.7424.

In absence of key economic releases in Australia today, investor sentiment would be determined by global macroeconomic events.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages

For the 24 hours to 23:00 GMT, Gold declined 0.15% against the USD and closed at USD1269.30 per ounce, as the US Dollar strengthened and after the US Federal Reserve Chair, Jerome Powell highlighted a ‘strong’ case for additional interest rate hikes.

In the Asian session, at GMT0300, the pair is trading at 1268.70, with gold trading 0.05% lower against the USD from yesterday’s close.

The pair is expected to find support at 1263.30, and a fall through could take it to the next support level of 1257.90. The pair is expected to find its first resistance at 1273.20, and a rise through could take it to the next resistance level of 1277.70.

The yellow metal is showing convergence with its 20 Hr moving average and trading below its 50 Hr moving average.

For the 24 hours to 23:00 GMT, Silver rose 0.58% against the USD and closed at USD16.40 per ounce.

In the Asian session, at GMT0300, the pair is trading at 16.39, with silver trading 0.06% lower against the USD from yesterday’s close.

The pair is expected to find support at 16.29, and a fall through could take it to the next support level of 16.19. The pair is expected to find its first resistance at 16.46, and a rise through could take it to the next resistance level of 16.53.

The white metal is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, Crude Oil rose 0.47% against the USD and closed at USD65.78 per barrel.

In the Asian session, at GMT0300, the pair is trading at 66.41, with oil trading 0.96% higher against the USD from yesterday’s close, amid uncertainty over potential rise in OPEC output.

The pair is expected to find support at 64.98, and a fall through could take it to the next support level of 63.56. The pair is expected to find its first resistance at 67.19 and a rise through could take it to the next resistance level of 67.98.

Crude oil is trading above its 20 Hr and 50 Hr moving averages.

Month

The DAX30 stock index is struggling to continue with the uptrend and a larger reversal is becoming more likely. June could be the 5th month in a row without a higher high, which could indicate the end of the bullish trend.

A break below the support trend line could confirm the end of wave 3 or C and the start of a larger bearish correction.

Week

The DAX seems to be building a rising wedge reversal chart pattern. A bearish bounce at the 78.6% Fibonacci resistance level could also indicate a potential head and shoulders reversal chart pattern (dark red boxes).

Day

DAX is breaking a support trend line (dotted green) after it completed a bullish ABC within wave B (orange). Price could be building a potential bearish wave 3.

The EUR/USD failed to break below the round level of 1.15 after price broke below the chart pattern. The bullish reversal could indicate a larger correction or perhaps the end of wave A.

The EUR/USD failed to break the larger support trend line (blue), which could indicate an expanded wave 4 (pink), a smaller correction on a 1 hr chart or the completion of atruncated wave 5 (pink – failure to break the bottom).

The EUR/USD bullish momentum could be a wave 1 (or A) and the correction could be part of a wave 2 (or B) as long as price stays above the 100% Fibonacci level at 1.1508 which is the invalidation spot for a larger bullish move.

The GBP/USD made another low but closed and reversed after reaching 1.31. The GU showed strong bullish momentum as it broke above the resistance trend line which could indicate a larger bullish move.

The GBP/USD might have completed a potential wave 5 of a larger wave 1, which could kick off a larger bullish correction in wave 2.

The GBP/USD bullish correction could develop via a wave 1-2 (purple) pattern. The wave 2 is invalidated if price breaks below the bottom of wave 2 (the 100% Fibonacci level).

General Trend:

• Shanghai Composites pares loss after trading in ‘bear market' territory
• Japanese megabanks trade broadly lower; On Thursday 7-day TIBOR moved into negative territory for first time since 1995
• Automakers in Japan trade lower after recent profit warning form Daimler; Toyota drops over 2.5%
• Australia's ANZ rises after doubling share buyback to A$3.0B
• Esprit declines over 3% after issuing profit warning
• Japan May CPI data was mixed, core in line while headline CPI was above ests
• Japan June prelim manufacturing PMI rises amid growth in new orders and increasing output; Export orders index declines for first time since 2016
• OPEC due to meet later today; OPEC+ expected to meet on Saturday, June 23rd

Headlines/Economic Data

Australia/New Zealand

• ASX 200 opened -0.1%
• ASX 200 Telecom index -2.4%, Energy -1.8%, Resources -1.3%, Consumer Discretionary -1%; Financials +0.8%
• (AU) Australia sells A$300M v A$300M indicated in 3.00% March 2047 bonds, avg yield 3.1435% v 3.2741% prior, bid to cover: 4.0x v 3.07x prior
• (NZ) New Zealand May Credit Card Spending M/M: -1.6% v 0.6% prior; Y/Y: 3.7% v 7.0% prior

China/Hong Kong

• Shanghai Composite opened -0.7%, Hang Seng -0.3%
• Hang Seng Utilities index +0.7%, Services +0.5%, Industrial Goods +0.5%; Energy -0.8%, Materials -0.7%
• (HK) There is speculation that the equity market in Hong Kong might be being impacted by the expected IPO of Xiaomi, in addition to trade concerns – US financial press
• (US) Some Trump administration officials reportedly pushing to resume trade talks ahead of China implementing tariffs on July 6th; advisers still at odds over strategy - press
• (CN) For the week, the PBoC injected a net of CNY140B in its open market operations (OMOs) v CNY240B net injection w/w.
• (CN) China PBoC sets yuan reference rate at 6.4804 v 6.4706 prior
• (CN) China Jan-May State-owned Enterprise (SOE) total profit CNY1.29T, +20.9% y/y; Rev CNY22.3T, +10.2% y/y
• (CN) China said to consider removing rating requirement for bond sales - Chinese Press
• (HK) US/China trade war might reduce Hong Kong GDP by up to 0.2% - US financial press

Japan

• Nikkei 225 opened -1%
• TOPIX Securities index -1.1%, Info & Communications -1%, Marine Transportation -0.8%, Real Estate -0.7%, Iron & Steel -0.6%
• (JP) JAPAN JUN PRELIMINARY PMI MANUFACTURING: 53.1 V 52.8 PRIOR
• (JP) JAPAN MAY NATIONAL CPI Y/Y: 0.7% V 0.6%E; CPI EX FRESH FOOD (CORE): 0.7% V 0.7%E
• (JP) Japan Apr All Industry Activity Index M/M: 1.0% v 0.9%e
• (JP) Japan ruling LDP party said to plan leadership election on Sept 20th as Shinzo Abe seeks re-election - Japanese Press

Korea

• Kospi opened -0.6%
• (KR) Fitch affirms South Korea sovereign rating at AA-; Outlook Stable
• (KR) South Korea said to deny speculated capital gains tax on cryptocurrencies

Other

• (MY) Malaysia names Nor Shamsiah new central bank (BNM) Gov (as speculated)
• (ID) Indonesia Central Bank Gov: Rupiah currency (IDR) year to date depreciation is 'tolerable'; Bought IDR1.25T in bonds from the secondary market on Thursday.

North America

• US equity markets ended lower: Dow -0.8%, S&P500 -0.6%, Nasdaq -0.9%, Russell 2000 -1.1%
• S&P500 Energy -1.9%, Industrials -1.3%
• FED BANK STRESS TEST RESULTS: ALL 35 BANKS EXCEED MINIMUM CAPITAL REQUIREMENTS
• (US) Lipper: US-based money market funds had $51.0B in net outflows for week ended Wed (largest outflow since 2011)
• (US) Moody's raises Florida's GO bond rating by 1 notch to Aaa from Aa1; Outlook Stable

Europe

• (UK) BOE Gov Carney's annual Mansion House speech: preparing for new global financial system
• (GR) Greece creditors agree on debt relief package (as speculated)

Levels as of 01:30ET

• Nikkei 225, -0.7%, ASX 200 -0.2%, Hang Seng +0.1%; Shanghai Composite +0.4%; Kospi +0.4%
• Equity Futures: S&P500 +0.3%; Nasdaq100 +0.1%, Dax +0.4%; FTSE100 +0.3%
• EUR 1.1599-1.1618 ; JPY 109.84-110.09 ; AUD 0.7373-0.7399 ;NZD 0.6854-0.6900
• Aug Gold -0.1% at $1,269/oz; Aug Crude Oil +1.3% at $66.36/brl; Jul Copper +0.1% at $3.03/lb