GBPUSD TECHS: Bear Threat Still Present

• RES 4: 1.1429 50-day EMA
• RES 3: 1.1380 High Sep 30 
• RES 2: 1.1324 20-day EMA
• RES 1: 1.1277 High Oct 6   
• PRICE: 1.1199 @ 19:26 BST Oct 13
• SUP 1: 1.1153 Low Oct 12
• SUP 2: 1.1111 50.0% retracement of the Feb 3 ‘25 - Jan 27 bull leg
• SUP 3: 1.1063 1.236 proj of the Apr 17  - Jun 24 - Aug 20 price swing
• SUP 4: 1.0987 1.382 proj of the Apr 17  - Jun 24 - Aug 20 price swing

EURUSD trend conditions are unchanged, they remain bearish and a fresh cycle low on Monday reinforces the bear theme. The pair has breached the base of a bear channel, drawn from the Apr 17 high. The base is currently at 1.1202. A clear breach of it would strengthen the downtrend and open 1.1111, a Fibonacci retracement point. Initial firm resistance to watch is 1.1324, the 20-day EMA. Short-term gains would be considered corrective.

• Looking ahead to tomorrow's CPI release for September, the median analyst estimate for core PCE of 0.21% M/M (range 0.18-0.23) at this stage would continue to see broad stabilization in the Y/Y rate, rounding to 3.0% Y/Y for a fourth consecutive month assuming no revisions.
• Shorter-term trends would remain more favorable however, with the three-month at 2.4% annualized (even if up from a surprisingly soft 2.05% in August) and the six-month rate at 2.7% annualized.
• The September SEP entries had a median estimate of 3.4% for 4Q26, which we don’t imagine included at the time widely expected downward revisions to the tune of -0.2pps but which ended up being more negative than expected at -0.36pp for the Y/Y rate as of July. 

• RES 4: 107-05+ High Sep 10
• RES 3: 106-10+ 50-day EMA 
• RES 2: 105-21   Low Sep 15 and 16 
• RES 1: 105-03   20-day EMA 
• PRICE:‌‌ 104-23+ @ 19:10 BST Oct 13
• SUP 1: 103-28+ Low Oct 01
• SUP 2: 103-20+ Low Jun ’07 (cont)
• SUP 3: 103-15+ 3.236 proj of the Jun 30 - Jul 14 - 17 price swing
• SUP 4: 103-00   3.500 proj of the Jun 30 - Jul 14 - 17 price swing

The trend condition in Treasuries is unchanged, it remains bearish and despite a shallow bounce, the contract is still trading closer to its recent cycle lows. Scope is seen for an extension towards 103-15+, a Fibonacci projection. Note that momentum studies highlight an oversold trend. A short-term reversal higher would allow this condition to unwind. Initial firm resistance to watch is 105-03, the 20-day EMA.