AUDUSD TECHS: Bearish Trend Sequence Intact
- RES 4: 0.6429 High Dec 12
- RES 3: 0.6384 High Dec 13
- RES 2: 0.6331 High Jan 24 and a key resistance
- RES 1: 0.6305 50-day EMA
- PRICE: 0.6289 @ 16:15 GMT Feb 5
- SUP 1: 0.6171/6088 Low Feb 4 / 3
- SUP 3: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
- SUP 3: 0.6000 Round number support
- SUP 4: 0.5931 1.764 proj of the Sep 30 - Nov 6 - 7 price swing
AUDUSD continues to recover from Monday’s low. Despite these gains, the trend structure remains bearish. Monday’s cycle low confirmed a continuation of the downtrend and maintains the price sequence of lower lows and lower highs. A resumption of the bear leg would open 0.6045, a Fibonacci projection. Key resistance is at 0.6305, the 50-day EMA, and 0.6331, the Jan 24. A clear breach of both levels would alter the picture.
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AUDUSD TECHS: Trend Structure Remains Bearish
- RES 4: 0.6471 High Dec 9
- RES 3: 0.6400 50-day EMA
- RES 2: 0.6341 High Dec 18
- RES 1: 0.6627/0.6302 20-day EMA / High Jan 6
- PRICE: 0.6243 @ 20:14 GMT Jan 6
- SUP 1: 0.6179 Low Dec 31
- SUP 3: 0.6158 1.236 proj of the Sep 30 - Nov 6 - 7 price swing
- SUP 3: 0.6100 Round number support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
Despite Monday’s gains, a bearish trend condition in AUDUSD remains intact. Recent weakness maintains the price sequence of lower lows and lower highs. Note that moving average studies are in a bear-mode position too, highlighting a dominant downtrend. Scope is seen for an extension towards 0.6158 next, a Fibonacci projection. Initial firm resistance to monitor is 0.6276, the 20-day EMA. It has been pierced but for now, remains intact.
US STOCKS: Late Equities Roundup: Paring First Half Gains
- Stocks are mixed in late trade, scaling back first half gains with S&P Eminis and Nasdaq indexes outperforming DJIA by the bell. Well off this morning's high of 43115.31 the DJIA trades down 51.3 points (-0.12%) at 42680.66, S&P E-Minis up 24.25 points (0.4%) at 6013.75, Nasdaq up 192.4 points (1%) at 19812.54.
- Semiconductor makers continued to benefit from news announced late Friday that Microsoft plans to invest $80B in AI-enabled data centers - at least half of that expected to be in the US. Leading gainers included Micron Technology +10.99%, Teradyne +6.98% while First Solar, Nvidia, KLA Corp, Applied Materials ad Lam Research all gained 3-5% in the second half.
- Interactive media and entertainment shares buoyed the Communication Services sector with Meta +2.79%, Paramount +2.67% and Alphabet +2.26%.
- On the flipside, Utility and Real Estate sectors continued to underperform in late trade, multi-energy providers weighing on the former: Sempra -3.18%, PG&E -2.84%, Xcel Energy -2.19%. Office and Residential investment trusts weighed on the Real Estate sector with UDR -3.48%, Essex Property Trust -3.35% and Kimco -3.24%.
- Reminder, the next round of quarterly earnings kicks off mid-January with Blackrock, Bank of NY Melon, Wells Fargo, JP Morgan, Goldman Sachs, Citigroup, US Bancorp, M&T Bank and PNC all reporting between January 13-16.
AUSSIE 10-YEAR TECHS: (H5) Monitoring Support
- RES 3: 96.975 - High Mar 14
- RES 2: 96.501 - 76.4% of the Mar 14 - Nov 1 ‘23 bear leg
- RES 1: 96.207 - 61.8% of the Mar 14 - Nov 1 ‘23 bear leg
- PRICE: 95.485 @ 19:58 GMT Jan 6
- SUP 1: 95.460 - Low Dec 20
- SUP 2: 95.275 - Low Nov 14
- SUP 3: 94.590 - 1.0% 10-dma envelope
The Aussie 10-yr futures contract continues to trade below the Dec 11 high of 95.851. A resumption of gains and a break of 95.851 would reinstate a bull cycle and refocus attention on resistance at the 96.207 level, a Fibonacci retracement point. On the downside, a stronger bearish reversal would instead expose 95.275, the Nov 14 low and a key support. A break of this level would strengthen a bearish theme.
