Greece Headlines, NFPs Invite Pre-Holiday Fireworks

GBPUSD – technical overview

An impressive rally to fresh 2015 highs has stalled out ahead of the 1.6000 psychological barrier, with the market reversing lower and exposing a drop back towards some internal support at 1.5550. A break and close below 1.5550 will open the door for a more pronounced bearish reversal, while inability to do so will keep the immediate pressure on the topside for an eventual retest and break above 1.6000.

• R2 1.5803 – 24Jun high – Strong
• R1 1.5734 – 1Jul high – Medium
• S1 1.5589 – 1Jul low  – Medium
• S2 1.5550 – Previous Resistance  – Strong

GBPUSD – fundamental overview

Some broad based US Dollar buying on more Greece uncertainty has been playing its part in weighing on the major pair, though UK developments are also factoring. On Wednesday, UK manufacturing PMIs came in a good deal softer than expected, while Bank of England Governor Carney was on the wires talking of low rates for an extended period of time. Looking ahead, second tier UK data is unlikely to factor too much, with the market continuing to focus on Greece, while also taking in the bumped up Thursday monthly employment report out of the US.

USDJPY – technical overview

Although the bullish structure remains firmly intact, following the recent break to fresh multi-year highs, the market has entered a period of healthy correction after stalling ahead of 126.00. Medium-term stretched studies are unwinding from overbought, with room for further weakness below 122.00. But any setbacks below 122.00 should be very well supported ahead of 120.00 in favour of a bullish resumption.

• R2 124.45 – 17Jun high – Strong
• R1 123.50 –Mid-Figure – Medium
• S1 122.35 – 1Jul low – Medium
• S2 121.94 – 30Jun low – Strong

USDJPY – fundamental overview

Buy siders were out in force on Wednesday, with these participants looking to build into portfolios for the second half of the year, adding further to long USDJPY exposure. Broad based demand for the US Dollar wasn’t lost on this pair, with the Dollar demand offsetting any flight to safety Yen bids. Meanwhile, a very solid US ADP employment print encouraged further upside, with the data setting the stage for a healthy NFP print today and increasing prospects for a sooner Fed rate hike.

EURCHF – technical overview

The market has finally leveled out after a multi-day drop out from the February high at 1.0815. From here, there is risk for a recovery back towards 1.0815 in the days ahead, with any setbacks expected to be very well supported above 1.0300 on a daily close basis. Look for a push back above 1.0575 to strengthen the constructive outlook and accelerate gains. Ultimately, only a daily close below 1.0300 would compromise the recovery outlook and give reason for pause.

• R2 1.0575 – 4Jun high – Strong
• R1 1.0500 – Psychological – Medium
• S1 1.0405 – 30Jun low – Medium
• S2 1.0315 – 29Jun low – Strong

EURCHF – fundamental overview

The major cross rate has been impressively well supported this week despite ongoing uncertainty surrounding Greece and the outcome of the upcoming referendum. It seems some rounds of intervention from the SNB this week have sent a strong message to the market the SNB will continue to aggressively battle any additional unwelcome flows into the Franc. Dealers cite sizable buy-stops above 1.0575.

AUDUSD – technical overview

Overall, the broader downtrend remains intact, with the market consolidating below psychological barriers at 0.8000. Look for a medium-term lower top to now be in place at 0.8163, in favour of the next major downside extension back towards and eventually below the current multi-year base from early April at 0.7533. For now, any corrective rallies should be well capped ahead of the recent peak at 0.7819, while ultimately, only a break back above 0.8163 will ultimately delay the bearish structure.

• R2 0.7771 – 24Jun high – Strong
• R1 0.7738 – 1Jul high – Medium
• S1 0.7587 – 29Jun low – Medium
• S2 0.7533 – 2Apr/2015 low – Strong

AUDUSD – fundamental overview

Softer Wednesday Aussie manufacturing PMIs and a below 50 China HSBC PMI print already set the tone for the day, with Aussie under pressure from the outset and accelerating to the downside into North America following a very healthy reading from the US ADP employment report. The risk associated with Greece’s fate could also not be discounted and acted as an additional strain on the commodity currency now approaching a retest of its 2015 multi-year base from March. Looking ahead, Greece headlines and US NFPs will be the focus in Thursday trade.

USDCAD – technical overview

Wednesday’s push through 1.2563 confirms a fresh higher low at 1.2128 and opens the door for the next major upside extension and retest of the 1.2835, 2015 high in the days ahead. At this point, look for any setbacks to be very well supported ahead of 1.2300, while only a drop below 1.2128 delays the highly constructive outlook for the pair.

• R2 1.2784 – 31Mar high – Strong
• R1 1.2667 – 10Apr high – Medium
• S1 1.2500 – 30Jun high – Medium
• S2 1.2475 – 1Jul low – Strong

USDCAD – fundamental overview

A perfect storm of events has hit the Canadian Dollar hard this week, with the currency coming under some intense pressure on the back of much softer Canada GDP, ongoing Greece uncertainty, falling commodities prices and some solid US economic data. Canada manufacturing PMIs are do in Thursday trade, though this data is likely to take a backseat to the monthly employment report out of the US and additional Greece headlines ahead of Sunday’s highly anticipated referendum. Stops were triggered above 1.2565 on Wednesday and the break now exposes the 2015 high at 1.2835.

NZDUSD – technical overview

The market continues to extend declines to fresh yearly and multi-year lows, with the pair closing in on a measured move downside objective in the 0.6500 area. However, with daily studies now tracking in oversold territory, there is risk for a short-term corrective bounce in the sessions ahead. But any rallies should be well capped ahead of 0.7000.

• R2 0.6882 – 29Jun high– Strong
• R1 0.6810 – 1Jul high– Medium
• S1 0.6694 – 2Jul/2015 low – Strong
• S2 0.6600 – Figure – Medium

NZDUSD – fundamental overview

The New Zealand Dollar trades at fresh five year lows against the Buck and continues to get hammered on monetary policy divergence and ongoing uncertainty in markets. The latest dairy auction result once again disappointed and has increased the chance for yet another RBNZ rate cut later this month. A healthy US ADP employment print on Wednesday has set the stage for the all important Thursday US NFPs, out a day earlier than usual on account of the July 4th holiday. Meanwhile, the risk associated with Greece’s fate has not been a friend to the still higher yielding Kiwi, and more downside is expected, particularly with the RBNZ targeting the 0.6500 level.

US SPX 500 – technical overview

The market has stalled out after posting record highs in May, with the lack of bullish momentum suggestive of exhaustion and warning of deeper setbacks ahead. Look for the latest topside failure and sharp bearish reversal below 2100 to strengthen the outlook and expose critical support at 2040. Rallies should now be well capped below 2100 on a daily close basis.

• R2 2137.00 – 19May/Record – Strong
• R1 2100.00 – Psychological – Medium
• S1 2055.00 – 29Jun low – Medium
• S2 2040.00 – 11Mar low – Strong

US SPX 500 – fundamental overview

The equity market has failed to establish any meaningful bullish momentum since breaking to fresh record highs in May and could be at risk of forming a major top. The escalation in the Greek crisis has opened a fresh round of setbacks, while ongoing solid US economic data helps to solidify prospects for a sooner than later rate liftoff. These realities are making it less attractive to be long equities at lofty levels. Still, while the market holds above the 2040 March lows, dip buyers are expected to emerge. Looking ahead, Greece headlines and US NFPs will dictate trade.

GOLD (SPOT) – technical overview

The market has been very well supported on dips since recovering from the 2014 base. The price action suggests the market could now be poised for a fresh bounce in the sessions ahead, in an attempt to carve out a more meaningful longer-term base. However, Wednesday’s daily close below 1170 is a threat to basing prospects with sustained weakness below the level to expose a retest of the critical 2014 base at 1131.

• R2 1206.00 – 18Jun high – Strong
• R1 1188.00 – 29Jun high – Medium
• S1 1163.00 – 5Jun low – Medium
• S2 1143.00 – 17Mar low – Strong

GOLD (SPOT) – fundamental overview

Quite surprisingly, the GOLD market has been unable to catch a bid this week and has even come under pressure despite a major cloud of uncertainty hanging over Greece and its future in the Eurozone. Stops were tripped below 1170 on Wednesday and any sustained weakness below this level could open a retest of the 2014 base down around 1130. It seems the market has grown disenchanted with the idea that GOLD is a blanket of safety, while strong US economic data and the prospect for a Fed rate liftoff is weighing further on the metal into the end of week. Clearly Greece headlines and today’s NFP report will play a role in the market’s direction around this critical support zone.

Feature – technical overview

USDZAR is locked within a well defined uptrend, with the market consolidating off recently established 2015 highs. A medium-term higher low is in place just over 11.6900, with any setbacks expected to be very well supported above the level ahead of the next major upside extension back above 12.6365. Ultimately, only a break and close below 11.6900 would negate.

• R2 12.6375 – 8Jun/2015 high – Strong
• R1 12.3900 – 29Jun high – Medium
• S1 12.0540 – 25Jun low – Medium
• S2 11.6945 – 6Apr low – Strong

Feature – fundamental overview

The relative outperformance in the Rand in the early week, following an impressive trade data showing has been short lived, with the currency a victim to broader macro themes and once again coming back under pressure. The picture on the domestic front is already quite shaky in South Africa and with Greece’s fate hanging in the balance and US economic data pointing to a sooner Fed rate liftoff, more weakness is expected for the Rand over the coming weeks.