Nothing to get too excited about

GBPUSD – technical overview

The market continues to be exceptionally well supported on dips below 1.2000. Unless we see a monthly close below 1.2000, we expect this to continue to be the case. Look for a push back above 1.2300 to strengthen the case for the establishment of a meaningful base.

• R2 1.2004– 5 August low – Strong
• R1 1.1937 – 19 August high – Medium
• S1 1.1718 – 23 August/2022 low – Medium
• S2 1.1700 – Figure – Strong

GBPUSD – fundamental overview

The UK rates market has been increasing bets on a more hawkish leaning BOE. UK composite PMI reads also managed to hold up in expansionary territory. All of this helped to support the Pound out from fresh yearly lows against the Buck. Key standouts on Wednesday’s calendar come from US durable goods and pending home sales.

USDJPY – technical overview

Technical studies are in the process of unwinding, with scope for correction in the days and weeks ahead. Look for additional upside from here to be well capped. Next key support comes in at 130.00.

• R2 138.00 – Figure – Medium
• R1 137.71 – 23 August high – Medium
• S1 134.65 – 18 August low – Medium
• S2 133.91 –17 August low – Strong

USDJPY – fundamental overview

As much as the Yen has been sold of late, the currency couldn't avoid rallying in Tuesday trade on the record jump in Japanese inflation reads. Meanwhile, the US Dollar was also sold across the board, adding to Yen demand. Key standouts on Wednesday’s calendar come from US durable goods and pending home sales.

AUDUSD – technical overview

Overall pressure remains on the downside despite the recent recovery and conditions remain quite choppy. A break back above 0.7137 would be required to take the pressure off the downside. Until then, scope exists for a lower top below 0.7284 and deeper setbacks towards 0.6500.

• R1 0.7200 – Figure – Medium
• R2 0.7137 – 11 August high – Medium
• S1 0.6856 – 23 August low – Strong
• S2 0.6800 – Figure – Medium

AUDUSD – fundamental overview

The Tuesday recovery in commodities and stocks was behind the rebound in the commodity correlated, risk correlated Australian Dollar. Key standouts on Wednesday’s calendar come from US durable goods and pending home sales.

USDCAD – technical overview

A recent surge back above 1.3000 signals an end to a period of bearish consolidation and suggests the market is in the process of carving out a more significant longer-term base. Next key resistance now comes in up into the 1.3500 area. Setbacks should be very well supported down into the 1.2500 area.

• R2 1.3079 – 17 June high – Strong
• R1 1.3064 – 23 August high  – Medium
• S1 1.2828 – 17 August low – Medium
• S2 1.2728 – 11 August low – Strong

USDCAD – fundamental overview

The Canadian Dollar managed to recover on Tuesday, getting help from higher oil, rallying US equities, and broad selling of the US Dollar. Key standouts on Wednesday’s calendar come from US durable goods and pending home sales.

NZDUSD – technical overview

Overall pressure remains on the downside despite the recent recovery and conditions remain quite choppy. A break back above 0.6469 would be required to take the pressure off the downside. Until then, scope exists for a lower top below 0.6577 and deeper setbacks below 0.6000.

• R2 0.6500 – Psychological – Strong
• R1 0.6469 – 12 August high – Medium
• S1 0.6157– 22 August low – Medium
• S2 0.6061 – 14 July/2022 low – Strong

NZDUSD – fundamental overview

The Tuesday recovery in commodities and stocks was behind the rebound in the commodity correlated, risk correlated New Zealand Dollar. Key standouts on Wednesday’s calendar come from US durable goods and pending home sales.

US SPX 500 – technical overview

Longer-term technical studies are in the process of unwinding from extended readings off record highs. Look for rallies to be well capped in favor of lower tops and lower lows. Back above 4,500 will be required at a minimum to take the immediate pressure off the downside. Next major support comes in around 3,400.

• R2 4422 – 3 March high – Strong
• R1 4328 – 16 August high – Strong
• S1 4080 – 2 August low – Medium
• S2 4000 – Psychological – Strong

US SPX 500 – fundamental overview

We've finally reached a point in the cycle where the Fed recognizes unanchored inflation expectations pose a greater downside risk than over-tightening. This is significant, as it means less investor friendly monetary policy that risks potential recession in the months ahead. We have seen an attempt at recovery in recent weeks, with softer CPI reads helping. But overall, we expect inflation to continue to be a problem that results in renewed downside pressure into rallies.

GOLD (SPOT) – technical overview

The 2019 breakout above the 2016 high at 1375 was a significant development, opening the door for fresh record highs. Setbacks should now be well supported above 1700 on a monthly close basis.

• R2 1880 – 13 June high – Strong
• R1 1815 – 4 July high – Medium
• S1 1700 – Round Number – Strong
• S2 1681 – 21 July/2022 low – Strong

GOLD (SPOT) – fundamental overview

The yellow metal continues to be well supported on dips with solid demand from medium and longer-term accounts. These players are more concerned about inflation risk and a less upbeat global growth outlook. All of this should keep the commodity well supported, with many market participants also fleeing to the hard asset as the grand dichotomy of record high equities and record low yields comes to an unnerving climax.