The Dollar recovers some ground today but remains generally below yesterday’s high, consolidations continue. Overall trading is subdued with major pairs and crossovers inside yesterday’s range. The kiwi and the aussie are softer while the greenback and the yen are firmer. The European majors are also weak, but there is no sales follow-up. Traders apparently hold their bets ahead of Jackson Hole.
Technically, while the DOW’s pullback this week is steep and deep, it is holding above the 55-day EMA as well as support at 32387.12 so far. There is no serious threat to the rally yet from 29653.29. A rebound from the current level could lay the groundwork for another rise, likely after comments from Fed Chairman Jerome Powell in Jackson Hole. However, a firm break of 32387.12 will indicate that the short-term move has reversed for another hold on the 30k handle.
In Europe, at the time of writing, the FTSE is down -0.41%. The DAX is up 0.01%. The CAC is up 0.12%. Germany’s 10-year yield is up 0.0585 at 1.378. Earlier in Asia, the Nikkei fell -0.49%. Hong Kong’s HSI index fell -1.20%. China Shanghai SSE lost -1.86%. Singapore Strait Times fell -0.39%. Japan’s 10-year JGB yield rose from 0.0022 to 0.224.
US durable goods orders flat in July, non-transportation orders up 0.3% m/m
U.S. durable goods orders fell -0.0% m/m to $273.5 billion in July, well below expectations of a 0.6% m/m rise. Non-transportation orders rose 0.3% mom, above expectations of 0.2% mom. Ex-defense orders rose 1.2% month-on-month. Transportation equipment led the decline and fell -0.7% mom to $93.0 billion.
Shipments of durable manufactured goods rose 0.4% month-on-month to $270 billion. Shipments of transportation equipment rose 1.1% month-on-month to $86.3 billion.
ECB Rehn: Digital native form of secure central bank money could improve stability
ECB Governing Council member Olli Rehn said “a digital euro would give people more choice about how to pay and make it easier to pay in an increasingly digital economy.”
“A native digital form of safe central bank money could improve stability by providing the neutral and trusted settlement layer in the future financial system,” he added.
Rehn expected the investigation phase of the digital euro to end in October 2023.
USD/CHF mid-day outlook
Daily Pivots: (S1) 0.9600; (P) 0.9646; (R1) 0.9689; After…
The intraday bias on USD/CHF remains neutral at this point. The triangle correction from 1.0063 could have already ended at 0.9369. Above 0.9691, resistance at 0.9884 will not be targeted next. A break there will indicate that the larger uptrend is ready to resume to 1.0063. On the downside, minor support below 0.9500 will dampen this view and return the bias to the downside for support at 0.9369 instead.
Overall, the current pattern suggests that the uptrend from 0.8756 (2021 low) is still ongoing. Sustained break of 1.0063 will target 100% projection 0.9149 to 1.0063 0.9369 to 1.0283 then 1.0342 (2016 high). For now, this will remain the preferred case as long as the support at 0.9369 holds, even if there is a deep pullback.
Economic Indicators Update
|12:30||USD||Durable Goods Orders Jul.||0.00%||0.60%||2.00%|
|12:30||USD||Durable goods orders excluding transportation Jul.||0.30%||0.20%||0.40%|
|14:00||USD||Door-to-door sales pending M/M Jul||-2.50%||-8.60%|
|2:30 p.m.||USD||crude oil inventories||-2.4M||-7.1M|