Status quo

GBPUSD – technical overview

The market is in a corrective phase in the aftermath of the run to fresh 2021 and multi-month highs. At this stage, additional setbacks should be limited to the 1.3500 area ahead of the next major upside extension towards a retest and break of critical resistance in the form of the 2018 high.

• R2 1.3888 – 11 August high – Medium
• R1 1.3846 – 17 August high – Medium
• S1 1.3680 – 27 August low – Medium
• S2 1.3572 – 20 July low – Strong

GBPUSD – fundamental overview

Surging UK house prices and broad based US Dollar weakness have been behind most of the latest run higher in the Pound. Key standouts on today’s calendar come in the form of Aussie PMI reads, Aussie retail sales, China PMIs, German PMIs, Eurozone and UK PMIs, the US jobs report, and US ISM non-manufacturing.

USDJPY – technical overview

The longer-term trend is bearish despite the recent run higher. Look for additional upside to be limited, with scope for a topside failure and bearish resumption back down towards the 100.00 area. It would take a clear break back above 113.00 to negate the outlook.

• R2 111.00 – Figure– Medium
• R1 110.81 – 11 August high – Strong
• S1 108.72 – 4 August low – Medium
• S2 108.34 – 7 May low – Strong

USDJPY – fundamental overview

More dovish talk out from BOJ officials and more demand for US equities, and yet, the Yen been selling off as one would expect. At the moment, it seems the broad based USD declines are playing their part, easily offsetting the bearish Yen flow. Key standouts on today’s calendar come in the form of Aussie PMI reads, Aussie retail sales, China PMIs, German PMIs, Eurozone and UK PMIs, the US jobs report, and US ISM non-manufacturing.

AUDUSD – technical overview

The Australian Dollar has been in the process of a healthy correction following the impressive run towards a retest of the 2018 high earlier this year. At this stage, there is risk for additional declines, though setbacks are expected to be well supported down into the 0.7000 area. Look for a weekly close above 0.7500 to force a shift in the structure.

• R2 0.7500 – Psychological – Medium
• R1 0.7427 – 4 August high – Medium
• S1 0.7285 – 30 August low – Medium
• S2 0.7222 – 27 August low – Medium

AUDUSD – fundamental overview

The Australian trade surplus hit a record high, PM Morrison said he would consider easing virus restrictions, US equities remained supported at record highs and the US Dollar was under broad pressure. All of this accounted for the latest strong run up in the Australian Dollar. Key standouts on today’s calendar come in the form of Aussie PMI reads, Aussie retail sales, China PMIs, German PMIs, Eurozone and UK PMIs, the US jobs report, and US ISM non-manufacturing.

USDCAD – technical overview

Finally signs of a major bottom in the works after a severe decline from the 2020 high. A recent weekly close back above 1.2500 encourages the constructive outlook and opens the door for a push back towards next critical resistance in the 1.3000 area. Any setbacks should be well supported into the 1.2200s.

• R2 1.2808 – 19 July high – Medium
• R1 1.2709 – 27 August high – Medium
• S1 1.2500– Psychological – Medium
• S2 1.2422 – 30 July low – Strong

USDCAD – fundamental overview

Canada's trade surplus narrowed on Thursday, but this didn't factor into price action, with the Canadian Dollar paying more attention to a rise in commodities, supported US equities and broad based US Dollar selling. Key standouts on today’s calendar come in the form of Aussie PMI reads, Aussie retail sales, China PMIs, German PMIs, Eurozone and UK PMIs, the US jobs report, and US ISM non-manufacturing.

NZDUSD – technical overview

The market has entered a period of consolidation after running up to a yearly and multi-month high. At this stage, rallies should be well capped and there is still room for deeper setbacks into the 0.6500-0.6800 area before we see an attempt at a higher low and resumption of upside pressure. Back above the April high at 0.7317 would be required to force a shift in the structure.

• R2 0.7200 – Figure – Medium
• R1 0.7161 – 15 June high – Medium
• S1 0.6987 – 30 August low – Medium
• S2 0.6930 – 25 August low – Medium

NZDUSD – fundamental overview

It's back to pressure on the RBNZ to be thinking about raising rates, this after this week's run of surging New Zealand house prices. All of this, along with broad based US Dollar declines and record high US stocks have resulted in a solid rally for the New Zealand Dollar. Key standouts on today’s calendar come in the form of Aussie PMI reads, Aussie retail sales, China PMIs, German PMIs, Eurozone and UK PMIs, the US jobs report, and US ISM non-manufacturing.

US SPX 500 – technical overview

Longer-term technical studies are looking quite exhausted and the market is showing signs of wanting to roll over after racing to another record high. Look for rallies to be well capped above 4500, with a break back below 4353 to strengthen the outlook.

• R2 4550 – Psychological – Strong
• R1 4546 – 2 September/Record high – Medium
• S1 4353 – 19 August low – Medium
• S2 4233 – 19 July low – Strong

US SPX 500 – fundamental overview

We're trading just off fresh record highs, and yet, with so little room for additional central bank accommodation, given an already depressed interest rate environment, the prospect for sustainable runs to the topside on easy money policy incentives and government stimulus, should no longer be as enticing to investors. Meanwhile, ongoing worry associated with coronavirus fallout and risk of rising inflation should weigh more heavily on investor sentiment into the second half of 2021.

GOLD (SPOT) – technical overview

The 2019 breakout above the 2016 high at 1375 was a significant development, opening the door for fresh record highs and an acceleration beyond the next major psychological barrier at 2000. Setbacks should now be well supported above 1600.

• R2 1917 – 1 June high – Strong
• R1 1835 – 15 July high – Medium
• S1 1700 – Round number – Medium
• S2 1677 – 8 March/2021 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 exhausted monetary policy, extended global equities, and coronavirus fallout. 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.