10-YEAR T-NOTE FUTURES (ZN1!), H4 Potential For Bullish Bounce

Type: Bullish BounceKey Levels:Resistance: 120'30'5Pivot: 118'07'0Support: 116'17'0Preferred Case:On the H4, with price moving in an ascending trend channel and moving above the ichimoku cloud , we have a bullish bias that price will bounce off the pivot at 118'07'0 in line with the overlap support and 38.2% fibonacci retracement to the 1st resistance at 120'30'5 at the swing high.Alternative Scenario:Alternatively, price may break the support structure at the pivot and drop to the 1st support at 116'17'0 at the overlap swing low in line with the two 61.8% fibonacci projections.Fundamentals:US indexes moved moderately higher with better-than-expected US economic reports on Wednesday. Hence, we have a bullish view on the 10-year t-note futures.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/10-year-t-note-futures-zn1-h4-potential-for-bullish-bounce"
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GBPUSD, H4 | Potential Bearish Drop

Type: Bearish ReversalKey Levels:Resistance: 1.19745Pivot: 1.19338Support: 1.18223Preferred Case:On the H4, with prices moving below the ichimoku indicator and within the descending channel, we have a bearish bias that price will drop from our pivot at 1.19338 where the horizontal pullback resistance is to our 1st support at 1.18223 where the 161.8% fibonacci extension, -61.8% fibonacci expansion and 61.8% fibonacci projection are.Alternative Scenario:Alternatively, price could rise to 1st resistance at 1.19745 in line with the pullback resistance, 100% fibonacci projection and 38.2% fibonacci retracement.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/gbpusd-h4-or-potential-bearish-drop7"
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Investment Bank Outlook 07-07-2022

Societe GeneraleStorm coming, but not today” was a poor choice of title yesterday! ¢ I’m not sure why everything went wrong yesterday, rather than waiting for the week’s more important data. Still, here we are, with recession fears firmly to the fore, UK monetary policy in a pickle, the UK government in a crisis that rolls on and on to an inevitable conclusion. The big drivers of markets are evolving slowly. Europe’s energy dependency on Russia is falling, but not fast enough to avoid recession if the pipeline is closed. If that happens, EUR/USD will likely lose another 10% or so and how do we handicap that risk? The best I can offer is that there is far, far more discussion of this possibility now than there was a month ago. There is more geopolitical risk priced in, and that’s a good thing. At the start of April, EUR/USD above 1.10 despite a 2-year rate differential that was 20bp wider than it is today.Take away the gas risk and the euro would be a lot stronger, but we can’t do that, any more than we can take away concerns about the ECB’s anti-fragmentation policy. The BTP/Bund spread is back under 2%, the 10year BTP yields 3.2%, more than 1% of its peak, but the damage is done. The euro-supportive power of rate hikes is eroded by the fact that the bond market isn’t trusted to stand on its own two feet, and the ECB’s credibility is damaged by having over[1]reacted to a spike yields and spreads that was nothing more than a normal response to higher US yields and wider credit spreads globally. The euro loses out, remains effectively unbuyable this summer. It’s so unbuyable that a major political crisis in the UK isn’t enough to drive EUR/GBP higher!Today’s main event will be the US services ISM report this afternoon. The manufacturing report sent out recession warnings, but services are in better shape, facing a hiring challenge more than a demand challenge. We’ll look at the orders-inventories gap, which has diverged from manufacturing of late (see below). But strong data might highlight the divergence from Europe, while soft data increase global recession concerns. Meanwhile, Olivier published a long AUD/NZD trade idea this morning, as the RBA looks set to hike faster than the RBNZ going forwards.INGUSD: June FOMC minutes as hawkish as expectedThe dollar remains close to recent highs as recessionary fears mount, while central banks remain very much in hawkish mode. On that latter point, last night's release of the June Federal Open Market Committee (FOMC) minutes showed a Fed very much concerned by upside risks to inflation and prepared to take rates into restrictive territory (above 2.5%). Concerns about downside risks to growth featured very little and the Fed's risk management approach is clearly in favour of front-loaded tightening on the risk that inflation is more persistent than expected.On that subject, EUR/USD one-week traded volatility is climbing back to recent highs near 12%. That is not a surprise given the event risks of the June US jobs numbers tomorrow, but particularly the US June CPI release next Wednesday, where any upside surprises could again cause havoc in global financial markets.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/investment-bank-outlook-07-07-2022"
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EURUSD，H4 | Potential Bearish Continuation Type

Type: Bearish ReversalKey Levels:Resistance: 1.03551 Pivot: 1.0231Support: 1.00075Preferred Case:On the H4, with price moving below the ichimoku cloud and in a descending trendline, we have a bearish bias that price will continue to drop from the pivot at 1.0231 in line with the 161.8% fibonacci extension and 100% fibonacci projection to the 1st support at 1.00075 in line with the 100% fibonacci projection and -61.8% fibonacci expansion.Alternative Scenario:Alternatively, price may reverse off pivot and rise to the 1st resistance at 1.03551 at the pullback swing low in line with the 61.8% fibonacci projection.

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Daily Market Outlook, July 7, 2022

Daily Market Outlook, July 7, 2022 Overnight Headlines Defiant UK PM Johnson Refuses To Quit, Fires Gove On Betrayal UK Tory MPs Fear Snap Election In Trumpian Survival Attempt Fed Sees ‘More Restrictive’ Rates Likely If Inflation Persists US Intelligence Warns China Influence Effort Against States Asia Manufacturers Sweat As US Mulls Tougher Tariff Rules China Data Show Economy Shrinking In Challenge To Target Shanghai Cases Rise To May Highs, Fuelling Lockdown Fear BoJ Seen Likely To Raise Price Forecasts, Slash Growth View Tokyo’s Governor Says City To Discuss Possible Covid Curbs Poll: Dollar Continues Dream Runs, Nothing Stands In Its Way Samsung’s Run Of Record Results Stall As Tech Boom Fades Merck In Advanced Talks To Buy Seagen In $40Bln PaymentThe Day Ahead Concerns about global recession risks and inflation remained elevated, although tech stocks led a more constructive tone in equity markets overnight in the Asia-Pacific region. Last night, the minutes of the Fed’s 14/15 June meeting reaffirmed that ‘even more restrictive policy could be appropriate’ to tackle inflation. Following June’s 75bp increase, markets have almost priced in a further 75bp rise by the Fed later this month. In the UK, PM Johnson remains in power despite a wave of government resignations yesterday and more this morning. A new executive of the 1922 committee, representing backbench Conservative MPs, will be elected next week and could decide to amend the rules on leadership changes. The Bank of England’s ‘Decision Maker Panel’ survey of businesses due at 09:30BST could draw some attention today. The results, particularly around inflation expectations, may have a significant impact on the Monetary Policy Committee’s deliberations in August, as speculation mounts on whether they deliver a larger 50bp hike rather than a 25bp increase. Policymakers will be looking for signs that inflation expectations remain well anchored and indications that pressures may be easing. The last survey in May showed an expectation that inflationary pressures would eventually ease. Speeches from MPC’s Pill and Mann may provide further insights into the outlook for monetary policy. At the last meeting, Mann voted in the minority for a 50bp hike while Pill voted for 25bp. Both have emphasised the need to lean against the risk of inflationary pressures becoming embedded. In the Eurozone, the ECB will release the ‘account’ (minutes) of its 8-9 June policy meeting. Officials have given strong hints that interest rate lift-off – the first increase since 2011 – will occur later this month with a 25bp rise expected. The ‘account’ will be parsed for indications of a potential 50bp increase in September and discussions on measures to counter fragmentation in the Eurozone. Figures earlier this morning revealed a small rise of 0.2% in German industrial production, but significant concerns remain around supply bottlenecks and restrictions in energy. US economic data include the May trade balance and weekly jobless claims. The trade data should support expectations for net exports to contribute positively to Q2 GDP growth. There are indications, however, of some softening of the labour market. Initial jobless claims remain low but have ticked higher in June. The June labour market report on Friday is this week’s key release. Fed speakers include Governor Waller and St Louis Fed President Bullard.FX Options Expiring 10am New York Cut EUR/USD: 1.0100 (1.08BLN), 1.0185 (408M), 1.0215-25 1.46BLN) 1.0275 (830M), 1.0290-00 (1.14BLN), 1.0325 (578M) 1.0350 (1.1BLN) USD/JPY: 133.95-05 (1.64BLN), 134.15 (220M), 135.00 (1.07BLN) 136.00 (1.07BLN) 136.15-20 (433M), 137.00 (760M) EUR/JPY: 144.00 (1.65BLN), 146.00 (1.6BLN) GBP/USD: 1.1800 (203M), 1.1950 (316M), 1.2000 (850M) EUR/GBP: 0.8575-85 (300M), 0.8600 (333M) AUD/USD: 0.6800 (363M), 0.6845-50 (670M), 0.6920 (305M) NZD/USD: 0.6270-80 (632M) USD/CAD: 1.2915 (200M), 1.2950 (390M), 1.3000 (681M) USD/CHF: 0.9700 (450M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.05 Retains offered tone, USD trading 20yr highs EUR/USD prints 20 year lows sub 1.0 ECB/FED policy divergence in focus China rise in Covid cases boosts USD safe haven bid ECB minutes up next Bears eyeing a parity test; offers seen at 1.0340/60 20 Day VWAP is bearish, 5 Day bearishGBPUSD Bias: Bearish below 1.2150 GBP pressured by political pantomime playing out in the UK Over 50 ministers and political aids have resigned from the UK Government GBP languishing at 2yr lows New Fin Min Zahawi among others urge PM to go Energy price inflation and recession fears weigh on GBP Bears breach YTD lows en-route to a test of 1.18 Offers seen at 1.20 Bids 1.1770 20 Day VWAP is bearish, 5 Day bearishUSDJPY Bias: Bullish above 134 Lack of directional flow with US Yields still sub 3% Large options 134/35/36/37 Japanese importer bids seen at 135 Traders betting on 134/137 range trade US10Y 2.94 trading firmer seen as supportive for USD/JPY Initial offers seen at 136.55/65 stops above to see retest of 137 Option barriers KO’s quoted at 137 remain intact 20 Day VWAP is bullish, 5 Day bullishAUDUSD Bias: Bearish below .7050 Recovers .68 handle as LDN opens up Commodity bounce supports with Copper +3% & Iron Ore +5% Offers seen towards .6900 Support seen at the 50% retracement of the 0.5510/0.8007 move at 0.6758 20 Day VWAP remains untested confirming downside 20 Day VWAP is bearish, 5 Day bearishBTCUSD Bias: Bearish below 22k BTC continues to rotate around 20K weighing by recession fears Testing air above the 20 day VWAP which has flipped bullish 20 VWAP band contracting ready for next directional drive Trend remains down as within broader bearish channel beckons Support seen at 19k then 18300 the base of the daily VWAP bands failure here opens a retest of lows Genesis Exchange said Wednesday it had been exposed to 3AC but mitigated losses Additional pressure seen from BTC miners liquidating positions on declining profitability 20 Day VWAP is bullish, 5 Day bullish

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Market Update – July 7 – Fed focused on Inflation, USD bid, Stocks flat Gold tumbles

USD moves from new to 20-year highs at 107 (USDIndex 106.64), US Stocks flat on close (NASDAQ +0.35%). FED Minutes leaned to the hawkish side. – ‘more restrictive’ policy as likely if inflation fails to come down. Asian markets are mostly positive (Hang Seng -0.13%, Nikkei +1.4%).  Yields closed up +3.3%. Oil fell another -1.0%, Gold plummeted again to $1735 & BTC rotates at $20k. UK PM Johnson has now lost over 40 members of his government but refuses to resign. AUD outperforms overnight.

Yesterday US ISM Service PMIs were better than expected but still at 25-mth low & JOLTS showed 11.25m job vacancies (1.9 jobs for every unemployed person).

• USDIndex tested 107.00 and remains on Bid at 106.65 now. 
• Equities – USA500 closed +0.36% 13.69pts (3845), US500FUTS at 3854 now.
• Yields 10-year yield higher,  closed at 2.92% , trades at 2.90% now. Yield curve inverted again yesterday.  
• Oil & Gold had weak sessions – USOil traded down to $95.10 lows and remains under  $100.00 at $98.48. Gold fell to 1732, next support at 1725, trades at 1745 now. 
• Bitcoin continues to trade around $20K, testing $20.3K today.
• FX Markets – EURUSD remains pressured at 1.0200, USDJPY rallied from under 135.00 to test 136.00 now. Cable trades at 1.1950 now.

Overnight – German Industrial Output missed at 0.2% from 1.3%. Australian Trade Balance much better at 15.97b vs 10.7b & 13.25b prior.

Today – US ADP Employment & International Trade, ECB Minutes, EIA Oil Inventories, Speeches from Fed’s Waller & Bullard, ECB’s Lane & Enria, BoE’s Pill. 

Biggest FX Mover @ (06:30 GMT) AUDJPY (+0.42%). AUD lifted by trade data. Rallied form allied from under 106.00 Tuesday to 103.50 today before recovering.  MAs aligning lower, MACD histogram negative but flat, RSI 41.00 & rising, H1 ATR 0.291, Daily ATR 1.378.

Click here to access our Economic Calendar

Stuart Cowell

Head Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

from HF Analysis /491037/
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Babcock International: a turnaround play in a growing sector

Britain’s defence spending is set to rise and Babcock International could soon return to favour, says David J Stevenson.

from Moneyweek RSS Feed https://moneyweek.com/investments/stocks-and-shares/share-tips/605070/babcock-international-company-analysis
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Hong Kong’s crown slips as Singapore takes over

As international sentiment sours on Hong Kong, other Asian financial hubs – primarily Singapore – are snapping up business.

from Moneyweek RSS Feed https://moneyweek.com/economy/asian-economy/605076/hong-kongs-crown-slips-as-singapore-takes-over
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Live Video Analysis ahead of FOMC Minutes

It is a busy week of data, as along with the key June NFP report, the FOMC minutes on Wednesday will be scrutinized, not so much for the outlook, but more to gauge the Committee’s general degree of hawkishness. Join Andria for a Live Commentary in the middle of the week before the FOMC minutes.

Click here to access our Economic Calendar

Andria Pichidi

Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

from HF Analysis /490795/
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Market Spotlight: Amazon Shares Rebounding

Amazon Shares ReboundingAmazon shares are turning higher today with the company’s stock price once again attempting to break out above the bear channel from YTD highs. The move comes amidst news that Amazon has agreed to take a 2% stake in US food-delivery service Grubhub. As part of the deal, Amazon prime users in the US will get a free month with the service. The deal has been compared to a similar partnership in the UK between Amazon and Deliveroo.Shares in Amazon have stabilised over recent months following a sharp drop over Q2, fuelled in part by the weaker-than-expected set of Q1 earnings the company released. Amazon is next due to report earnings at the end of July with shareholders hoping for a better set of results to help lift the company’s stock out of the doldrums.Technical ViewsAmazonWith the stock developing a firm base of support along the 100.55 level, Amazon shares are now threatening to break out above the top of the bear channel from YTD highs. The key level to focus on will be the 123.79 highs. If price can break above this level, this will confirm the shift in sentiment, putting focus on 137.81 next.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-amazon-shares-rebounding"
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Market Spotlight: CADJPY Reversal on Watch

CADJPY on WatchPrice action in CADJPY is starting to looking interesting here to the short-side. The pair has been trending steadily higher this year. However, over the last month, we are starting to see signs that the pair might be topping out. Currently, the pair is at risk of putting in a double top (with lower top) formation, suggesting room for a break of the bull trend line and a deeper move lower. The key level to watch will be 102.17 support. Bears can trade a break of this level looking for 99.09 initially. Retail positioning is still heavily short but reducing so it will likely take a move through that support to confirm the shift in sentiment.Keep an Eye OnThe current drop in risk assets, particularly oi, is hitting CAD while driving JPY higher on better safe-haven demand. While the theme continues, we can expect CADJPY to continue lower near-term. Tonight’s FOMC minutes might well provide the catalyst for the next leg in this move is we see USD trading higher in response to the minutes.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-cadjpy-reversal-on-watch"
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GBP Falls As Key UK Cabinet Members Quit & BOE Warns Ove Economic Outlook

Political Instability Rocks PoundThe British Pound is undergoing a sharp shift in sentiment this week. News of major political resignations yesterday have exacerbated the atmosphere of uncertainty and fear among UK investors. While the current UK administration has been no stranger to adversity, scandal and in recent times, almost falling apart, news yesterday of Rishi Sunak and Sajid Javid quitting cabinet was truly unexpected.The moves, which were announced in protest at the PM’s involvement in scandal after scandal, are just the latest in a string of events pointing to a loss of confidence in the UK. The first of these events being the very literal vote-of-no-confidence held against the PM last month. With dark clouds gathering over the current government traders are increasingly concerned as to the near-term path of UK politics and what this will mean for the economy during such as difficult time.BOE Issues Warning in Financial Stability ReportAlong with the unexpected political developments we saw yesterday, we also had the latest Financial Stability Report update from the BOE. The report made sobering reading and saw the bank warning over the deteriorating economic outlook, both globally and domestically. The BOE warned that a spiralling global inflationary environment was having a harsh impact on businesses and consumers alike and looks likely to continue that way for some months to come.Citing the impact of the war in Ukraine, BOE’s Bailey warned that current conditions will also make households and businesses more vulnerable to further shocks going forward. Bailey said “These higher prices, weaker growth and tighter financing conditions will make it harder for households and businesses to repay or refinance debt.” The BOE chief went on to say: “Given this, we expect households and businesses to become more stretched over coming months. They will also be more vulnerable to further shocks,”BOE Raises CCyB RateGiven the dire outlook, the BOE raised its capital requirements for British lenders yesterday. The BOE has told banks to raise their countercyclical capital buffer rate to 2% from 1%, as of July 2023. On this, Bailey noted that “Given considerable uncertainty around the outlook, the FPC will continue to monitor the situation. We stand ready to vary the UK CCyB rate — in either direction — depending on how risks develop.”Rate Hike Expectations SlipNotably, BOE rate hike expectations have since been scaled back a little into year end as traders judge that the BOE will opt to move at a more cautious pace. It’s a tricky time for the bank as it juggles the need to support the economy with the need to combat inflation. This dilemma has been clearly reflected in the volatility we’ve seen in the FTSE and GBP recently.Technical ViewsGBPUSDThe sell off in GBPUSD this year has seen the market grinding steadily lower within a well-defined bear channel. Price is now sitting on support at the .1934 level. With both MACD and RSI bearish, there are risks of a further breakdown below this level towards the 1.1474 level next. However, it wis worth noting we are seeing bullish divergence on momentum studies. Bulls will need to see a break of the 1.2355 level to alleviate near-term bearishness.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/gbp-falls-as-key-uk-cabinet-members-quit-and-boe-warns-ove-economic-outlook"
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Investment Bank Outlook 06-07-2022

INGUSD: Macro themes continue to drive financial markets.One does not have to look too far beyond the inverted US yield curve or the collapse in copper to understand that investors continue to re-price global growth prospects lower. Bank of England Governor Andrew Bailey yesterday said that the global growth outlook has 'deteriorated markedly'. The big question for financial markets is whether this deterioration in growth prospects is enough to curtail tightening cycles - especially that of the Fed. It was instructive in yesterday's risk asset sell-off that only 6bp was priced out of this year's Fed tightening cycle compared to 12bp taken out of both the ECB and BoE cycles. Driving that is probably: a) European activity is more exposed to the Russian energy supply shock and b) the US economy entered this global tightening cycle with more momentum and a positive output gap.EUR: Parity beckonsWhen it came, the break of EUR/USD to a new cycle low was unexpected. If anything, driving yesterday's market activity was the continued rise in European natural gas prices as Russian supplies ebb. Already running at only 40% of capacity, Russia's Nordsteam 1 pipeline will be closed for maintenance 11-21 July (when will it reopen?) and exposes the friction of continuing European dependency on Russian gas at a time when it ideally would be shunning it completely. One year ahead Dutch natural gas prices have risen around 30% over the last week and back to the December spike highs. And the German government is now being dragged into state bailouts of major gas utility giants such as Uniper.GBP: Big hitters quit the cabinetSterling has tended to ignore the indiscretions of Boris Johnson's government - largely because the Conservatives have a large majority. But the resignations of the big-hitters in charge of the Treasury and Health will leave the PM rocking and effectively sees sterling hit as hard as the euro. It is not clear whether the new chancellor, Nadim Zahawi, will represent a shift in economic policy, although he may be tempted to loosen up fiscal policy earlier than expected.EUR/GBP can continue to trade near 0.8600, but a 2% dollar advance puts cable down near the 1.17 area. Additionally, we have been saying over recent months that sterling has been exhibiting more of the characteristics of a growth currency. A tough summer for equities suggests cable remains vulnerable to the 1.14/15 area.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/investment-bank-outlook-06-07-2022"
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Daily Market Outlook, July 6, 2022

Daily Market Outlook, July 6, 2022 Overnight Headlines UK PM Scrambles To Save Himself, Reshuffles Top Cabinet New Chancellor Zahawi Inherits Faltering Economy, Inflation Tory Rebels Plan Rule 1922 Change To Expel UK's Johnson Biden Prepares Action To Reshape Trump's Tariffs On China US Pushes ASML To Stop Selling Chipmaking Gear To China Blinken Plans A ‘Candid Exchange’ With China Over Ukraine US Call For Russia Pressure To Open Grain Delivery Lanes Shanghai Mass Testing Fuel Fear Another Lockdown Looms ECB Policymakers Unwavering In Support For Tighter Policy BoE's Tenreyro: Gilt Sales Unlikely To Have Economic Affect Goldman Say Oil Has Overshot As Global Deficit Unresolved Europe Gas At Near 4-Month High, Focus On Tight SuppliesThe Day Ahead Global recession fears continued to dominate the mood in financial markets, despite reports suggesting that US-China talks may lead to lower trade tariffs. European equities closed lower yesterday after a constructive start to the week, while their US counterparts ended in the red after the return from a public holiday. Asian stock markets followed through with widespread sell-offs. Brent crude oil dropped to a low of $101.10 yesterday but is slightly higher overnight. US 10-year Treasury yields has declined to 2.80%. The release of the minutes of the US Federal Reserve’s June policy meeting will be closely parsed as markets assess how policymakers respond to the trade-off between a weakening economic outlook and still uncomfortably high inflation. The Fed upped the ante and hiked rates by 75bp last month, with Chair Powell indicating that a similar rise is in play later this month. Powell indicated that evidence of rising longer-term inflation expectations among consumers partly justified the bigger hike. However, that measure of inflation expectations has since been revised lower. Nevertheless, given the Fed’s imperative to meet its inflation objective, the tone of the minutes is still likely to be ‘hawkish’ with the likelihood of further aggressive tightening flagged. In the UK, political uncertainty has increased after the resignations of the Chancellor and the Health Secretary yesterday. PM Johnson has indicated he is determined to stay on, while reports suggest his party’s MPs may seek to amend the rules over leadership changes. PMQs take place today. Meanwhile, Bank of England Chief Economist Pill is scheduled to give a keynote address entitled ‘The role of Central Banks in a Transforming World’ at a Qatar conference. Earlier this morning, BoE Deputy Governor Cunliffe said UK growth will be ‘essentially flat’ over the coming year, but the Bank will act to bring down inflation. Data wise, the UK construction PMI for June will be released and is expected to show continued expansion in activity in the sector. Yesterday’s UK services PMI was revised up to 54.3. Financial markets, nevertheless, are focused on softening business expectations. This morning’s Eurozone retail sales figures are likely to attract limited attention. Broader concerns remain about the curtailment of energy supplies from Russia and the impact on the Eurozone economy. The US data focus will be the ISM services survey. Look for a fall to 54.5 in June from 55.9, which would be the weakest pace of expansion for two years.FX Options Expiring 10am New York Cut EUR/USD: 1.0230 (570M), 1.0250 (471M), 1.0300-10 (374M) 1.0400-10 (350M) USD/JPY: 133.97-00 (682M), 134.50-60 (710M) 135.00 (615M), 135.00 (615M), 136.00 (506M) GBP/USD: 1.2250 (204M) AUD/USD: 0.6675-85 (487M). NZD/USD: 0.6200 (392M) 0.6410 (1.18BLN). AUD/JPY: 89.30 (1.1BLN), 93.49 (773M) USD/CAD: 1.2830 (566M), 1.3000 (380M), 1.3050-60 (270M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.05 Consolidates after big losses on Tuesday’s increasing recession fears EUR/USD prints 20 year lows sub 1.0250 Huge 17% increase in European natural gas prices raise recession alarms Lack of co-ordination on ECB support to indebted Eurozone states sours sentiment June Eurozone business growth adds further pressure to Euro Fed June meeting minutes released later as market eyes potential 75bps hike in July Bears eyeing a parity test; offers seen at 1.0340/60 20 Day VWAP is bearish, 5 Day bearishGBPUSD Bias: Bearish below 1.2150 GBP pressured by political developments and weakening economy GBP/USD sitting at you year lows after losing 1.25% yesterday Fin Min & Health Sec quit Johnson Government decrying poor leadership New Fin Min Zahawi left to manage weak econ & cost of living crisis Energy price inflation and recession fears weigh on GBP Bears breach YTD lows en-route to a test of 1.18 Offers seen at 1.2130/60 Bids 1.1770 20 Day VWAP is bearish, 5 Day bearishUSDJPY Bias: Bullish above 134 JPY demand rises on recession fears USD/JPY off another leg, 135.90 to 135.13 EBS Japanese importer bids seen at 135 Traders betting on 134/137 range trade US10Y 2.84 trading firmer by just under 1% seen as supportive for USD/JPY Initial offers seen at 136.55/65 stops above to see retest of 137 Option barriers KO’s quoted at 137 remain intact 20 Day VWAP is bullish, 5 Day bullishAUDUSD Bias: Bearish below .7050 Recovers .68 handle as LDN opens up Commodity crush continues to weigh on AUD Oil and Index futures in the US recover lost ground supporting nascent AUD bid Offers seen towards .6900 AUD likely to take its lead from commodity trade ahead of FOMC minutes later Support seen at the 50% retracement of the 0.5510/0.8007 move at 0.6758 20 Day VWAP remains untested confirming downside 20 Day VWAP is bearish, 5 Day bearishBTCUSD Bias: Bearish below 22k BTC continues to rotate around 20K weighing by recession fears Testing the 20 day VWAP which remains bearish 20 VWAP band contracting ready for next directional drive Trend remains down as within broader bearish channel beckons Support seen at 19k then 18300 the base of the daily VWAP bands failure here opens a retest of lows 20 Day VWAP remains bearishly oriented and untested Additional pressure seen from BTC miners liquidating positions on declining profitability 20 Day VWAP is bearish, 5 Day bearish

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/daily-market-outlook-july-6-2022"
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