US Market On Holiday, Greece Referendum Ahead

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 1.5733 – 1Jul high – Strong
• R1 1.5700 – Figure – Medium
• S1 1.5562 – 2Jul low  – Medium
• S2 1.5550 – Previous Resistance  – Strong

GBPUSD – fundamental overview

A lackluster bout of trade for the Pound on Thursday, with the UK currency unwilling to make any directional commitment. A solid UK construction PMI showing did nothing to bolster the Pound, while a discouraging monthly employment report out of the US only managed to prop Cable off its daily lows. Friday is a light day of trade with the US market out for holiday, and not much attention will be given to UK services PMIs, with the Greece referendum dominating headlines.

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 and consolidation 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 123.72 –2Jul high – Medium
• S1 122.35 – 1Jul low – Medium
• S2 121.94 – 30Jun low – Strong

USDJPY – fundamental overview

An early Thursday rally in the major pair came to a screeching halt post the release of the US employment report, with the below forecast reading and downward revision to the May number weighing a good deal. Meanwhile, the other components of the data didn’t do anything to help matters, with the participation rate dropping to its lowest levels since 1977 and wage growth coming in exceptionally subdued. USDJPY rallies were already in question irrespective of the US data result, with the still risk correlated market exposed to the uncertainty surrounding the outcome of this Sunday’s Greece referendum. Dealers do however continue to cite plenty of demand on dips.

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 1.0525 – 2Jul high – 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 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 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 0.7738 – 1Jul high – Strong
• R1 0.7657 – 3Jul high – Medium
• S1 0.7533 – 2Apr/2015 low – Strong
• S2 0.7500 – Psychological – Medium

AUDUSD – fundamental overview

Friday’s release of the much softer Aussie retail sales will likely put more pressure on the RBA to consider additional rate cuts at next week’s meeting. It hasn’t been a great week for Aussie, with manufacturing PMIs, trade data and declining China stocks also disappointing. Meanwhile, iron ore prices are back on the decline, while the ongoing saga in Greece has invited more downside pressure to the risk correlated commodity currency, now at risk of breaking to fresh multi-year lows below 0.7500.

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 1.2633 – 2Jul high – Medium
• S1 1.2500 – 30Jun high – Medium
• S2 1.2475 – 1Jul low – Strong

USDCAD – fundamental overview

The Canadian Dollar got a much needed breather in Thursday trade, with the Loonie rallying modestly against the Buck after some intense selling on the back of the softer monthly employment report out of the US. But overall, softer Canada GDP, declining commodities and ongoing risk associated with Greece are not CAD friendly themes and should weigh more heavily in the sessions ahead, with USDCAD seen back to retesting the 2015 peak at 1.2835. Looking ahead, Friday should be a quiet day, with no Canada data on the docket and the US markets out for the July 4th, long holiday weekend.

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 0.6662 – 2Jul/2015 low – Strong
• S2 0.6600 – Figure – Medium

NZDUSD – fundamental overview

A bout of underwhelming New Zealand economic data and ongoing risk associated with Greece have kept this risk correlated currency relatively underperforming and trading to fresh 5 year lows against the Buck. Kiwi is now closing in on PM Key’s targeted 0.6500 level, though the currency did find some relief in Thursday trade following the softer monthly employment report out of the US. Still, overall, the RBNZ has done a 180 on monetary policy these past few months and this shift along with the shaky macro picture, should keep the pressure on the downside.

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 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 overall 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. And yet, even with Thursday’s employment report casting some doubt on a more aggressive Fed timeline, investors have still been wary of buying at current levels on fear of overvaluation and capitulation. Looking ahead, the result of this Sunday’s Greece referendum will likely have a major influence on the market come the Monday open.

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, the recent 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 1157.00 – 2Jul 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. There were however some bargain hunters that emerged in the aftermath of a disappointing US employment report, and even with all the disenchantment, we could see some interest ahead of Sunday’s Greece referendum risk.

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

Not a whole lot of support for the Rand into Friday trade, with the market unable to even extend gains too much on the disappointing monthly employment report out of the US. It seems the stress associated with Greece risk and a struggling local economy have been enough of a reminder to stay away from the Rand. Thursday’s South Africa consumer confidence reading was much worse than expected, and this will do nothing to help the beleaguered South African currency. Power outages and rising taxes are also Rand negative drivers that should not be overlooked.