US10Y printed a new YTD high this week. US2Y, US10Y, and US30Y have been taking turns printing new highs week after week. US Treasury yields remain the single most important asset to monitor.
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US10Y printed a new YTD high this week. US2Y, US10Y, and US30Y have been taking turns printing new highs week after week. US Treasury yields remain the single most important asset to monitor.
Z1!
BZ1! CL1!
Talks to resolve the Middle East conflict remain stalled. The SPR fell by another 3.1 million barrels to 286.6 million.
Both BZ and CL have broken above intermediate resistance. If prices don't fall back below support in the coming sessions, the likelihood of an explosive move higher in crude increases exponentially.
Technical
The descending channel midpoint is now the support to hold. Above it, the upper boundary remains in play, with a sustained break opening further upside.. Above 100, we have 120.
USDJPY The yen strengthened this week as traders priced in a more hawkish BOJ following Takata's call for a more flexible pace of hikes. Waller's comments also weighed on the dollar, so the move had support from both sides of the rate differential.155.55 remains the key level to watch.
00700.HK
601899
MSFT
HSI
NVDA faces strong resistance around 230. A break above it opens further upside toward the ascending trendline.
NIFTY drifted lower as crude prices continued to weigh on the index. Unless it recaptures the ascending trendline over the next few sessions, the path of least resistance remains to the downside.
XAUUSD I have said for months that the explosive move in gold begins only when it decouples from yields and the dollar. We are not there yet.
Higher oil -> higher inflation and inflation expectations -> higher yields -> lower gold. That chain remains intact. Friday made it obvious. Strong payrolls put another Fed hike back on the table, pushed yields and the dollar higher, and sent gold lower.
As long as the Iran war keeps oil elevated, it remains a headwind for gold, not a reason to chase it. Gold must start rising through higher yields and a stronger dollar before the next phase begins. Until then, do not front-run a decoupling that has not happened.
Technical
4.4K remains the support to hold. Reclaiming the broken ascending trendline puts the recent high back in play. A sustained break below 4.4K opens 4K, followed by 3.9K.
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SPX NDX
For ES1! to climb back to its ATH, it must first reclaim the descending trendline.
At current oil prices, Trump is likely to pull another TACO. NQ1! held its ascending trendline support during the week, bounced from it, and led the market on Friday. The odds favor an upside breakout sometime next week.
The bull entry was back at 7,630. The next entry is a backtest of the descending trendline after the breakout, should it occur.
USDJPY
MAGSTechnical: MAGS remains inside a contracting range and is now testing descending trendline resistance.
USDJPYTechnical: USDJPY has reclaimed the ascending trendline. As long as it holds, 162.58 remains in play.
US30YTechnical: US30Y remains above 5.18%. As long as it holds, 5.3% remains in play. Below 5.18%, the ascending trendline comes back into play.
GOOGLTechnical: GOOGL is testing the upper channel boundary, with 343.7 as key support. A sustained break above the upper boundary opens further upside. A sustained break below 343.7 keeps the path of least resistance to the downside.
HTI1!Technical: HTI has broken below 4.74K and remains below the broken descending trendline. Unless it reclaims 4.74K, 4.25K remains in play. A sustained move above 4.74K puts the broken descending trendline back in play, followed by 5.14K if the trendline is cleared.
BZ1! The TACO headline arrived just as oil approached 100, exactly as we had expected. It triggered a sharp drop in oil prices midweek but did not materially change the underlying situation. Hormuz flows remain below prewar levels, product inventories remain tight, and the SPR fell by another 3.7 million barrels, leaving just 289.7 million barrels in reserve. Oil also held up well through the hawkish Jackson Hole repricing while the dollar and front-end yields moved higher. No change to the technicals.
XAUUSD In the previous Tactical Positioning, I warned that elevated long-end yields did not bode well for gold and that silver was unlikely to sustain a rally without confirmation from gold. Both calls played out. Gold has pulled back to its breakout area, while silver was rejected at 70.
Warsh's hawkish message accelerated the move. US2Y surged back to 4.36%, while US10Y and US30Y remain elevated at 4.73% and 5.21%. The long-term thesis has not changed, but the rates backdrop still does not support chasing either metal without confirmation.
Technical
Gold is trading around its ascending trendline and the key support area at 4.4K-4.45K. This offers bulls a good entry with well-defined risk. A sustained break below 4.4K puts 4K back in play, followed by 3.9K.
KOSPI never delivered the confirmation bulls needed. The capitulation rebound stalled at resistance, and the index has spent the past two weeks going nowhere beneath it.
Technical
7.1K remains first resistance. Unless KOSPI breaks above it, 5.79K and the ascending trendline remain exposed. A sustained break above 7.1K puts 7.49K back in play, followed by 8.12K.
601899Technical: As long as Zijin remains above 32.4 and the ascending trendline, the path of least resistance remains higher. A sustained break below both puts 25 back in play.
PLTRTechnical: As long as 155.6 holds, the breakout remains intact. A sustained break below 155.6 puts the broken descending trendline back in play.
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