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Crude oil futures continue the consolidation since breaking higher on Tuesday trade
The price of crude oil settled at $78.95, down $0.65 (-0.82%). Trading was relatively contained, with a low of $78.58 and a high of $80.87, as the market continued to consolidate after Tuesday's breakout to the topside.
That breakout was technically significant, with the price pushing above both the 38.2% retracement of the decline from the June 3 high at $78.48 and a downward-sloping trend line near the same level. Since then, crude has rotated higher and lower three separate times, forming a tightening range. Each rally has produced a slightly lower high, while each pullback has found support at progressively higher levels near the 38.2% retracement.
Today's low held about 10 cents above the $78.48 retracement, reinforcing that level as a key technical support and keeping buyers in control for now.
As long as the price remains above $78.48, the technical bias favors another push toward this week's highs, with the 50% retracement at $82.01 serving as the next major upside target. On the downside, a move back below $78.48, followed by a break beneath the rising 100-hour moving average at $77.84, would shift the advantage back to the sellers.
For now, the buyers have gained some momentum, but they still need to prove they can build on Tuesday's breakout. The sellers, meanwhile, must reclaim support-turned-resistance to regain control. The technical battle continues.
This article was written by Greg Michalowski at investinglive.com. -
The Micron chart flashes an ugly sign
This chart is as ugly as it gets in terms of a topping formation.
Micro shares have fallen $400 in the past three weeks and are now at the lowest since May 26. They're down 32% after initially surging on the most-recent quarterly earnings report. In that report, the company forecast it would earn $31 per share in the coming quarter with no slowdown in sight.
Annualized that's $124, which puts the shares at 7x earnings (though the consensus is $73.37 this year). For next year the consensus is $157 so that puts forward earnings at just 5.4x.
So in terms of fundamentals, it's tough to see a drop in the shares unless you anticipate some kind of breakthrough in memory usage for large language models. The thing is, there have been hints that OpenAI is working on something to that effect, so buyer beware.
In terms of the technicals, the measured target of the head-and-shoulders top is about $500. Down there, you're looking at just 3x earnings and even if memory proves to highly cyclical (as always) that's a hard number to get to.
All told, there is a powerful technicals-vs-fundamentals setup here that is the main event in markets right now. The volatility in the chip and AI hyperscaler trade is intense right now. Earnings season for the spenders is coming up and that could be the reckoning if they pull the plug but right now the murmurs from Meta at least aren't pointing in that direction.
This article was written by Adam Button at investinglive.com. -
GBPUSD retraces to the targeted swing area between 1.3446 to 1.3465.
The GBPUSD surged higher yesterday, breaking through a series of important technical hurdles and shifting the near-term bias in favor of the buyers.
The rally began with the pair finding support against the rising 200-hour moving average (currently at 1.3404) before powering through a cluster of key moving averages near 1.3400, including the 100-hour, 100-day, and 200-day moving averages. Buyers then pushed the price above a downward-sloping trend line connecting the recent highs, followed by a break through the key swing area between 1.3446 and 1.3465 (see red numbered circles and yellow area on the chart above). That zone also contained the 61.8% retracement of the decline from the May 1 high at 1.34598, making the breakout even more technically significant.
Once above those levels, upside momentum accelerated, carrying the pair to 1.3557, briefly exceeding the May 12 and May 13 swing highs at 1.35526 before backing off the boil into the close.
Today's price action has seen just the opposite, however, and is testing buyers as to whether that breakout has staying power.
The pair has rotated back lower and, over the last hour, has returned to the former resistance zone between 1.3446 and 1.3465. The broken 61.8% retracement at 1.34598 is also being retested, with today's low reaching 1.3460 before finding support.
This is now the key battleground. If buyers step back in and defend this former resistance area as new support, yesterday's breakout remains intact and the path higher stays in play. Failure to hold the zone, however, would suggest yesterday's rally was driven more by a combination of political headlines, technical short covering, and momentum buying than by a lasting shift in trend. In that case, a deeper pullback toward the moving average cluster near 1.3400, including the 100-day and 200-day moving averages, would become the next downside target.
Bottom line: The 1.3446-1.3465 support zone is the line in the sand.
This article was written by Greg Michalowski at investinglive.com. -
U.S. dollar gains as yields move higher.
U.S. retail sales came in close to expectations, while the Philadelphia Fed Manufacturing Index surprised sharply to the upside, likely reflecting improved business sentiment following the Middle East ceasefire and the decline in oil prices. Housing data, however, remained soft. Despite the mixed economic backdrop, Treasury yields pushed higher, with both the 2-year and 10-year yields rising around 4 basis points.
Fed Chair Kevin Warsh also helped shape the market narrative, reiterating that the Federal Reserve's balance sheet remains too large and should be reduced over time. That has fueled speculation that more aggressive balance sheet runoff could increase Treasury supply, putting upward pressure on yields. Higher long-term rates can tighten financial conditions without requiring additional Fed rate hikes, helping restrain inflation while continuing the balance sheet normalization process.
The rise in Treasury yields has given the U.S. dollar fresh support. In the video above, I quickly review the technical outlook for the major currency pairs, highlighting the bias, the key risks, and the important technical levels to watch.
- EURUSD: The pair has more than doubled its intraday range during the North American session, falling to 1.1437. The next key support comes from the converged 100- and 200-hour moving averages at 1.1424, which represent an important technical barometer. Holding above that level would keep buyers in the game, while a break below would strengthen the sellers' case.
- USDJPY: The pair has rallied into a key swing area between 162.399 and 162.508, reaching a session high of 162.47. A sustained break above this resistance would clear the path toward the 40-year high at 162.833. If sellers defend the ceiling, look for a pullback toward the 100- and 200-hour moving averages near 162.15.
- GBPUSD: Sterling continues to correct lower, slipping back below the May swing highs at 1.35089 and 1.34854. The next major downside target is the 61.8% retracement at 1.34598, although interim support is found at the 50% midpoint of yesterday's rally at 1.34689.
- USDCHF: The dollar has benefited from the rise in Treasury yields, with buyers maintaining the near-term advantage. The key question is whether the pair can build on the move higher and extend its recovery, or whether resistance will once again attract sellers and stall the advance.
- USDCAD: The pair briefly broke below the 1.4015-1.4024 support zone, reaching 1.4011, before rebounding back above the area. That recovery has given buyers renewed confidence, with the pair now hovering near unchanged on the day. A move back into positive territory would improve the short-term outlook, exposing today's high at 1.4053 as the next upside target.
- AUDUSD: The Aussie is drifting back toward important support at the 0.7000 psychological level and the broken 38.2% retracement at 0.6993. A break below that support would increase bearish momentum and shift the focus toward the rising 100-hour moving average at 0.6965
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The USD is mixed and little changed to kickstart the new trading day
The USD is mixed and little changed vs the major currency pairs. Looking at the major currency pairs, with the exception of the USDCHF (+0.19%) and the GBPUSD (-0.30%), the other currency pairs are all within 0.09% of unchanged on the day. In the video above I take a look at the three major currency pairs - the EURUSD, USDJPY and GBPUSD - from a technical perspective to kickstart the North American trading session. What isthe trading bias, the risks and the targets for each right now and I explain why. Get your trading day off to a good start.
The US that a series of attacks on Iranian targets. Crude oil prices are setting.
The North American session is highlighted by the June U.S. retail sales report, which will provide a key read on the strength of consumer spending following recent softer inflation data. Investors will also closely watch the weekly jobless claims figures and the July Philadelphia Fed manufacturing survey for fresh insight into labor market conditions and business activity, while Canada releases June housing starts before the U.S. data.
- 8:15 AM ET – Canada House Starts (Jun): 257.9K vs. 261.4K
- 8:30 AM ET – U.S. Initial Jobless Claims (week ending Jul. 11): 217K vs. 215K
- 8:30 AM ET – U.S. Continuing Jobless Claims (week ending Jul. 4): 1.815M vs. 1.814M
- 8:30 AM ET – U.S. Philadelphia Fed Business Outlook (Jul): 13.0 vs. 10.3
- 8:30 AM ET – U.S. Retail Sales MoM (Jun): 0.2% vs. 0.9%
- 8:30 AM ET – U.S. Retail Sales ex-Autos MoM (Jun): -0.1% vs. 0.8%
- 8:30 AM ET – U.S. Retail Sales Control Group (Jun): 0.5% vs. 0.7%
- 10:00 AM ET – U.S. Business Inventories MoM (May): 0.3% vs. 0.5%
- 10:00 AM ET – U.S. NAHB Housing Market Index (Jul): 35 vs. 35
- 10:00 AM ET – U.S. Pending Home Sales Index (Jun): 76.8 vs. 76.8
- 10:00 AM ET – U.S. Pending Home Sales MoM (Jun): -0.5% vs. 3.8%
Fed's Logan and Schmid will be speaking today.
In the pre-market for the US stock market, the futures are implying higher levels with the:
- Dow up 85 points
- S&P -27 points
- Nasdaq -253 points
IN the US debt market, yields are higher:
- 2 year yield 4.161%, +3.1 basis points
- 5 year yield 4.287%, +3.2 basis points
- 10 year yield 45577%, +3.2 basis
- 30 year yield 5.113%, +3.0 basis points
in other markets
- Crrude oil is up $0.14 and $79.73
- Gold i down $24 at $4036
- Silver is down $1.15 and $56.68
- Bitcoin is down $753 and $64,197