1.4700 on EURUSD and 1,047 on S&P500 represent levels of major trend line support holding since the March lows and are both being under threat as we speak (see atatched). 1,047 is the 55-day MA of the S&P500, a close of which paves the way for 998, and 1.4410 in EURUSD, which is the 23.6% retracement.

The broadening nature of risk version onslaught (FX, equities and commodities) takes precedence over what could have been risk-positive dynamics (higher than expected Aussie CPI, Norges rate hike and steady US durable orders). But the creeping tide of reduced appetite is growing into a mini wave of deleveraging as risk-seeking trades find no fundamental justification to push equities and commodities past key technical parameters (100-week MA in S&P500 and 100-week MA in oil are some of these levels).

The RBNZ could escalate the selling in the high yielding currencies in the event that it leaves short term rates steady at 2.50%. While we could see more losses in NZD, AUD and NOK against USD, but there is more downside against JPY. NZDJPY eyes 65.30, while AUDJPY is vulnerable to 78.90.