BELGIUM AUCTION PREVIEW: On offer next week

Germany Chancellor Olaf Scholz is speaking in the Bundestag (parliament) ahead of tomorrow's European Council summit (live stream in German). On the economy, Scholz says 'Modernising industry must be one of the central points of the next five years in the EU'. Calls for 'a lot of new free trade agreements in the EU' and 'a new industrial policy agenda that goes beyond reform'. Scholz confirms that industry associations have been invited to the chancellery later in the month for talks on these subjects. Scholz and his tripartite gov't remain under pressure domestically amid an increasingly shaky economic outlook. 

• On the war in Ukraine, Scholz says that support for Kyiv will 'remain in the coming years', and reaffirms the EU's EUR35bn commitment (on 15 Oct a gov't spox said this could fall if the US commits funds to the G7 USD50bn loan scheme).
• On the situation in the Middle East Scholz says that there are German arms deliveries to Israel 'and there will be in the future'. Says 'We will not accept Iran attacking Israel with rockets...Iran is playing with fire'.

• RES 4: 99.47 High Oct and key short-term resistance
• RES 3: 98.53 High Oct 3  
• RES 2: 98.11 Low Sep 2 and a key near-term resistance      
• RES 1: 97.88 Intraday high             
• PRICE: 97.80 @ 12:15 BST Oct 16
• SUP 1: 96.97/95.83 High Oct 15 and gap low / Low Oct 10              
• SUP 2: 95.47 1.236 proj of the Sep 17 - 30 - Oct 1 price swing
• SUP 3: 94.90 2.0% 10-dma envelope
• SUP 4: 94.99 1.382 proj of the Sep 17 - 30 - Oct 1 price swing

A bear cycle in Gilt futures remains present and the latest recovery is considered corrective. Note that short-term gains are allowing an oversold trend condition to unwind. The contract is approaching resistance at 98.11, the Sep 2 low. A continuation higher and a break of 98.11 would open 98.68, a Fibonacci retracement. For bears, a reversal would refocus attention on key support at 95.83, Oct 10 low. A break of this level resumes a bearish theme.