Daily Global Macro Technical Trend Bias/Key Levels (Tues 05 Jun)

Mix bag in FX space with USD/JPY remains on solid footing due to improved risk appetite. Major stock indices remain in a recovery process and watch the 12850 upside trigger level on the DAX.

FX –  Mix bag with AUD/USD at major resistance

  • EUR/USD – Trend bias: Short-term recovery scenario remains intact.  A slight push up higher was seen in yesterday, 04 Jun European session where it printed a minor higher high of 1.1744 before it pull-backed by 67 pips in the U.S. session to hit a low of 1.1677.  No change, maintain bullish bias in any dips with 1.1600/1590 remains at the key short-term support for a further potential push up towards the next intermediate resistances at 1.1760 (former minor swing low areas of 21 Nov/12 Dec 2017) follow by 1.1880/1940 (38.2% Fibonacci retracement of the decline from 16 Feb 2018 high to 29 May 2018 low + former minor swing low area of 09/10 Jan 2018 that was rejected on 14 May 2018). On the other hand, failure to hold at 1.1590 negates the recovery process for a slide to retest last week’s low of 1.1510 and a below it exposes the lower limit of the key major support zone at 1.1430 (the former resistance of a basing configuration that occurred in  May 2015/Jun 2016 + 50% Fibonacci of the multi-year up move from Jan 2017 low to 16 Feb 2018 high of 1.2555).
  • GBP/USD – Trend bias: Short-term mean reversion rebound in progress. Inched higher as expected, it printed a high of 1.3398 in yesterday, 04 Jun European session before it pull-backed by 103 pips in the U.S session to print a low of 1.3295. In addition, the 4 hour Stochastic oscillator is now back at its oversold region with the pair still holding at the predefined 1.3295 key short-term support as per highlighted in yesterday report. No change, maintain bullish bias as long as 1.3295 support holds for a further potential residual push up to target the next intermediate resistance at 1.3480 (former minor range congestion support from 04/18 May 2018 + 23.6% Fibonacci retracement of the on-going down move from 17 Apr 2018 high to 29 May low of 1.3205). However, a break below 1.3295 invalidates the short-term rebound scenario for a continuation of the medium-term down move to target the next support at 1.3200/3160 (29 May 2018 swing low area + 50% Fibonacci retracement of the multi-year up move from Oct 2016 low to 17 Apr 2018 high of 1.4377).
  • AUD/USD – Trend bias: At risk of resuming its medium-term down move.  The pair had hit the short-term rebound target/resistance of 0.7625/7655 as expected (refer to yesterday report). Elliot Wave/fractal analysis suggests that the risk of a bearish impulsive downleg sequence at this juncture where the pair is now right below a major graphical resistance zone of 0.7655/7690 (the pull-back resistance of the former major bearish “Ascending Wedge” support from Jan 2016 + former medium-term swing low area of 20 Mar 2018). In addition, the 4 hour Stochastic oscillator has exited from its overbought region. Flip to a bearish bias in any bounce below key resistance at 0.7690 for a potential push down to target the intermediate support at 0.7600/7585 (the former minor high areas of 22/31 May 2018) and breaking below 0.7585 opens up scope for a further potential push down to target the next intermediate resistance at 0.7515 (the minor swing low of 01 Jun 2018 & the lower boundary of the minor ascending channel from 09 May 2018 low). On the other hand, a clearance above 0.7690 invalidates the bearish scenario for a further squeeze up towards the next resistance at 0.7800 (medium-term swing high of 13/19 Apr 2018 & close to 50% Fibonacci retracement of the entire down move from 26 Jan 2018 high to  09 May 2018 low).
  • NZD/USD - Trend bias: Sideways. Pushed up as expected and hit the intermediate resistance/target of 0.7050/60 (refer to yesterday report) as it printed a high of 0.7048 in yesterday, 04 Jun European session. Mix elements now, prefer to turn neutral first between 0.7060 (former minor swing high area of 04 May 2018 + Fibonacci projection/retracement cluster) and 0.7015 (the former minor swing high areas of 31 May/01 Jun 2018 + minor steep ascending trendline from 30 May 2018 low). A clearance (an hourly close) above 0.7060 triggers a potential squeeze up to retest a significant medium-term resistance at 0.7190 (the former range support from 08 Feb/20 Mar 2018 before the recent bearish breakdown that led to a decline of 330 pips + 61.8% Fibonacci retracement of the decline from 13 Apr 2018 high to 16 May 2018 low). On the flipside, failure to hold at 0.7015 opens up scope for a decline towards the intermediate support of 0.6960 (the former minor swing low area of 01 Jun 2018) and below exposes the next support of 0.6900 (psychological + minor ascending trendline from 15 May 2018/the start of the current short-term rebound).
  • USD/JPY - Trend bias: Short-term mean reversion rebound remains in progress. Continued to push up higher as expected (printed a current intraday high of 109.99 in today, 05 Jun Asian session). No change, maintain bullish bias in any dips with adjusted key short-term support now at 109.60 (the lower boundary of a minor ascending channel from 31 May 2018 low + close to the former minor swing high areas of 01/04 Jun 2018) for a further potential push up to target the intermediate resistance at 110.10/30 (minor swing high of 24 May 2018 + 61.8% Fibonacci retracement of the decline from 21 May high to 29 May 2018 low) and above it opens up scope for a further rally towards 110.60 next (upper boundary of the aforementioned minor ascending channel + Fibonacci retracement/projection cluster). However, failure to hold at 109.60 negates the bullish tone for a deeper pull-back to retest the next intermediate support at 109.35 (the minor swing low of 04 Jun 2018) and below it triggers a further extension towards 109.10/109.00 support next (psychological + former minor range resistance from 29/30 May 2018).

Stock Indices (CFD) – Recovery process remains intact

  • US SP 500 – Trend bias: Up move remains in progress. The Index has managed to clear above the 2741/38 former minor range resistance in place since 14 May 2018 in yesterday, 04 Jun U.S. session. In addition, higher beta indices have continued to outperform the S&P 500 where the Nasdaq 100 recorded a gain of 0.84% versus a gain of 0.45% seen in the S&P 500, the NYSE FANG+ rallied by 1.5% to print a fresh all-time high record close of 2858. No change, maintain bullish bias in any dips with adjusted key short-term support now at 2725 (the former minor swing high area of 31 May 2018 + minor ascending trendline from 30 May 2018 low) for a further potential push up to target the next intermediate resistance at 2760/65 in the first step (minor swing high areas of 15/16 Mar 2018). However, a break below 2725 negates the bullish tone for a deeper pull-back towards the next intermediate support at 2700  (31 May  2018 minor swing low).
  • Japan 225 – Trend bias: Up move remains in progress. Pushed up as expected and met the lower limit of the intermediate resistance/target zone of 22600/640 (printed a current intraday high of 22606 in today, 05 Jun Asian session). No change, maintain bullish bias with adjusted key short-term support at 22370 (former minor swing high of 01 Jun 2018 + pull-back support of a former minor descending trendline resistance from 22 May 2018 high) for a further potential push up to target the next intermediate resistance at 22730 (also the medium-term upside trigger level, the former swing low areas of 16 May 2018 before the recent steep pull-back occurred + 76.4% Fibonacci retracement of the decline from 21 May high to 30 May 2018 low). On the other hand, a break below 22730 negates the bullish tone for a deeper pull-back to retest the next intermediate support at 22260 (former minor swing high areas of 30/31 May 2018 + minor ascending trendline from 29 May 2018 U.S. session low of 21923).
  • Hong Kong 50 – Trend bias: Push up within range configuration remains in progress. Inched higher as expected and printed a current intraday high of 31067 in today, 05 Jun Asian session. No change, maintain bullish bias in any dips with adjusted key short-term support now at 30800 (minor ascending trendline from 30 May 2018 low + former minor range resistance from 24/28 May 2018) for a further potential push up to target intermediate resistances of 31240 (minor gap resistance of  22/23 May 2018 + 76.4% Fibonacci retracement of the recent slide from 14 May to 30 May 2018 low) follow by 31500 next (minor swing high of 21 May 2018).  However, failure to hold at 30800 sees another choppy decline to retest the 30000/29900 minor range support from 26 Apr/07 May 2018.
  • Australia 200 – Trend bias: Sideways, holding at the 5980 key medium-term support. The Index reintegrated back below the 6010 short-term support (the minor pull-back support of the former minor descending trendline resistance from 31 May 2018) but managed to hold at the 5980 key medium-term support (pull-back support of the former “Symmetrical Triangle” resistance from 09 Jan 2018 and the 38.2% Fibonacci retracement of the up move from 04 Apr low to 10 May 2018 high). A lack of upside momentum in the short-term, prefer to turn neutral first between 5980 and 6036 (minor swing high areas of 31 May/04 Jun 2018). Only an hourly close above 6036 is likely to see a push up towards the next intermediate resistances at 6068 and 6087 (minor congestion area from 07 May/21 May 2018 + 61.8%/76.4% Fibonacci retracement of the recent decline from 15 May high to 29 May 2018 U.S. session low of 5943).
  • Germany 30Trend bias: Sideways with upside bias. No change, bulls need to have an hourly close above the 12850 level (the former minor swing low area of 24 May 2018 & the minor descending trendline from 22 May 2018 high)  in the European session to trigger at least a short-term push up towards the 13000/13050 intermediate resistance in the first step (minor swing high area of 28 May 2018 before the recent steep decline occurred). On the other hand, a daily close below the 12630 key medium-term support sees a deeper corrective decline towards the next support at 12300/200  (swing low area of 25 Apr 2018 + primary ascending trendline from Feb 2016 low + 61.8% Fibonacci retracement of the up move from 26 Mar low to 22 May 2018 high).   

 *Levels are obtained from City Index Advantage TraderPro platform



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