COMMODITIES: Bearish WTI Future Trend Intact, Gains Considered Corrective
Despite recent gains, a bearish trend condition in WTI futures remains intact, and gains are considered corrective. However, a key resistance at $69.14, the 50-day EMA, has been pierced. The breach of this hurdle strengthens a bullish theme and opens $70.98, the Feb 25 high. For bears, a reversal lower would expose the bear trigger at $64.85, the Mar 5 low. Clearance of this level would resume the downtrend and open $63.73, the Oct 10 ‘24 low. The trend condition in Gold is unchanged, it remains bullish and the yellow metal is holding on to the bulk of its recent gains. Last week’s fresh trend high reinforces the bull theme and sights are on $3079.2 next, a Fibonacci projection. Note that moving average studies remain in a bull-mode position, highlighting a dominant uptrend and positive market sentiment. Support is at $2974.8, the 20-day EMA.
- WTI Crude down $0.36 or -0.52% at $69.4
- Natural Gas down $0.11 or -2.87% at $3.737
- Gold spot up $17.76 or +0.59% at $3034.16
- Copper down $1 or -0.19% at $523.1
- Silver up $0.07 or +0.22% at $33.6592
- Platinum down $1.85 or -0.19% at $973.86
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ITALY AUCTION PREVIEW: BTP Short Term and BTPei Auction
Italy will sell E2.50-2.75bln of the 2.55% Feb-27 BTP Short Term (ISIN: IT0005633794) and E1.25-1.50bln of the 1.80% May-36 BTPei (ISIN: IT0005588881) at today’s auction.
- This will be the first re-opening of the 2.55% Feb-27 BTP Short Term, which was launched on January 28. The launch saw a 1.63x bid-to-cover ratio for the E3bln issued.
- The spread of this BTP Short Term to the 2.20% Mar-27 Schatz has fluctuated in a relatively narrow range between 32-35bps since January.
- The 1.80% May-36 BTPei has been re-opened three times since its syndicated launch last March. The January re-opening attracted a 1.72x bid-to-cover ratio for the E1.25bln issued, with the average price of 99.060 exceeding the 98.966 pre-auction mid-price.
- Comparing against the 1.45% Mar-36 BTP, this BTPei has a breakeven rate of 171.4bps (vs a YTD closing low of 168.1bps on Jan 1)
- Timing: Results will be available shortly after the bidding window closes at 10:00GMT / 11:00CET.
EURIBOR OPTIONS: Call spread buyer
ERZ5 98.50/98.75cs, bought for 3.25 in 20k.
BONDS: US and UK Roll update
ROLLS continue to dominate, June is not quite yet front Month for Gilt or Treasuries, but will likely be into Tomorrow.
- Ultra 30: 56%.
- TBond: 52%.
- Ultra 10: 52%.
- TYA: 57%.
- FVA: 51%.
- TUA: 57%.
- Gilt: 40% (as of Yesterday).
