BUNDS: Big focus on the German Yields on the Open
- Big focus on the German Yields on the Open, the German 10yr will be close to 2.60%, as the future moves towards 131.06, printed a 131.15 low overnight.
- The 2yr Schatz saw the next small resistance at 2.252%, equated to 106.61 Yesterday, just 1.5 ticks away from the printed low.
- Looking at the 30yr, with the continued fall in Futures, it could now be set to test the 2024 high (printed in May) at 2.83%.
- Zooming out of the Bund chart, it is quite a stunning move, falling 603 ticks from the 2nd Dec high to Today's low, or a rally from 2.029%, to what should be close to 2.60% Today.
- There's very little out of Europe on the Data front for Today, French IP and Italian Retail Sales won't be moving the needle, it is all about the US Labour Data.
- US NFP's range is 120k/268k, median 165k, Whisper 184k vs 185k Yesterday.
- SPEAKERS: Fed Goolsbee.
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EURJPY TECHS: MA Studies Continue To Highlight A Downtrend
- RES 4: 164.76 High Nov 20 and a key short-term resistance
- RES 3: 162.49 High Nov 22
- RES 2: 161.73 50-day EMA
- RES 1: 160.07/160.43 High Dec 10 / 20-day EMA
- PRICE: 159.48 @ 07:15 GMT Dec 11
- SUP 1: 157.56 Low Dec 05
- SUP 2: 156.18 Low Dec 03 and the bear trigger
- SUP 3: 155.15 Low Sep 16 and a key support
- SUP 4: 153.87 Low Dec 8 / 14 2023
A bear cycle in EURJPY remains in play and recent short-term gains are considered corrective. Moving average studies are in a bear mode position, highlighting a downtrend. 157.87, the 76.4% retracement of the Sep 16 - Oct 31 bull cycle, has been breached. The clear break of this level strengthens a bearish theme and opens 155.15, the Sep 16 low. Initial firm resistance to monitor is 160.43, the 20-day EMA.
BUNDS: US CPI is at the forefront
- Bund and multi cross assets (Govies, Rates, Equities, FX) were fairly steady and have traded in very light volumes overnight session, following an overall mixed start of the Week as we head into Year end.
- Before that, US CPI today, ECB Tomorrow, Fed decision and Equity rolls next Week are the main focus to end the Year.
- For Bund initial support is at Yesterday's low of 135.75, coincided with the very short term 2.14% retracement in 10yr Yield.
Yesterday's high is at 136.26, but better resistance is seen at 136.52. - The only release out of Europe this Morning will be the Final Portugal CPI, won't move the needle with the US today.
- SUPPLY: UK £4bn 10yr (equates to 32.3k Gilt) should weigh, US sells $39bn of 10yr reopening.
BTP TECHS: (H5) Trend Needle Points North
- RES 4: 124.00 Round number resistance
- RES 3: 123.83 1.764 proj of the Nov 7 - 15 - 18 price swing
- RES 2: 123.43 1.618 proj of the Nov 7 - 15 - 18 price swing
- RES 1: 123.32 High Dec 9
- PRICE: 122.86 @ Close Dec 10
- SUP 1: 122.34 Low Dec 4
- SUP 2: 121.58 20-day EMA
- SUP 3: 120.05 Low Nov 25
- SUP 4: 119.11 Low Nov 18
BTP futures remain in a bull cycle and the contract is trading closer to its recent highs. The latest rally has resulted in a move through key resistance at 121.97, the Oct 1 high. The clear break of this level highlights an important bullish development and opens 123.43 next, a Fibonacci projection. The trend is overbought and a corrective pullback would allow this condition to unwind. Support to watch is 121.58, the 20-day EMA.
