USDJPY TECHS: Bull Cycle Remains In Play
- RES 4: 151.62 61.8% retracement of the Jan 10 - Apr 22 bear leg
- RES 3: 150.92 High Aug 1 and a key resistance
- RES 2: 149.64 76.4% retracement of the Aug 1 - Sep 17 bear leg
- RES 1: 149.14 High High Sep 3
- PRICE: 148.78 @ 06:45 BST Sep 25
- SUP 1: 146.77/145.49 Low Sep 18 / 17 and a pivot support
- SUP 2: 145.40 50% retracement of the Apr - Aug upleg
- SUP 3: 144.10 61.8% retracement of the Apr - Aug upleg
- SUP 4: 143.45 Low Jul 3
USDJPY is firmer as the pair extends the recovery that started Sep 17. The move higher strengthens a short-term bullish theme. Note too that a bullish candle pattern on Sep 17 - a hammer formation - provided an early reversal signal and this pattern remains valid. Furthermore, moving average studies remain in a bull-mode condition, highlighting a dominant uptrend. Sights are on 149.14, the Sep 3 high. Pivot support is 145.49, the Sep 17 low.
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EUROZONE ISSUANCE: EGB Supply Daily (1/2)
Austria and the ESM are both likely to hold syndications and Italy an auction today. Italy, Germany and Finland are due to hold auctions later in the week, too, while the EU and Belgium held auctions yesterday. We pencil in issuance of E29.7bln for the week, up from E22.8bln last week.
- Austria will hold a syndication to launch a new 7-year RAGB maturing 20 September 2032 in a E3bln syndicated transaction in the “near future” (MNI expects today). Bookrunners will be BofA Securities, Deutsche Bank, Erste Group, HSBC, J.P. Morgan and Raiffeisen Bank International.
- We had flagged the possibility of an Austrian syndication this week in the MNI EGB Issuance, Redemption and Cash Flow Matrix and had been close with the maturity (we had expected a long 6-year rather than the 7-year announced).
- This transaction will come ahead of the E13.3bln redemption of the formerly 10-year RAGB which is due to mature on 20 October.
- The ESM sent a Request for Proposal with regards to an upcoming transaction last week. This means a syndicated transaction today looks likely. We had flagged an ESM/EFSF transaction as likely in late August (although we thought EFSF was more likely).
- Italy will come to the market this morning to sell E2.5-3.0bln of the on-the-run 2.10% Aug-27 BTP Short Term (ISIN: IT0005657330) via auction. Note that the MEF announced that the BTPei line would not be on offer in August (in line with the precedent seen in recent years).
EUROZONE T-BILL ISSUANCE: W/C 25 August
Austria and Italy are both still due to sell bills this week while Germany and France came to the market today. We expect issuance to be E18.8bln in first round operations, up from E14.8bln last week.
- This morning, Austria will look to come to the market with E1bln of the 2-month Oct 30, 2025 ATB and E2bln of the new 3-month Nov 27, 2025 Green ATB.
- To conclude bill issuance for the week on Wednesday morning, Italy will look to sell E3bln of the 5-month Jan 30, 2026 BOT.
EUROSTOXX50 TECHS: (U5) Short-Term Weakness Appears Corrective
- RES 4: 5575.00 High Mar 3 and a major resistance (cont)
- RES 3: 5568.00 High Mar 6
- RES 2: 5526.00 High Mar 19 / 20 (cont)
- RES 1: 5522.00 High Aug 22
- PRICE: 5423.00 @ 06:24 BST Aug 26
- SUP 1: 5405.00 Intraday low
- SUP 2: 5373.59 50-day EMA
- SUP 3: 5280.00 Low Aug 7
- SUP 4: 5249.00 Low Aug 5
The trend set-up in Eurostoxx 50 futures is bullish and the pullback from last Friday’s high is for now, considered corrective. The recent print above the May and July highs strengthens a bull theme and signals scope for a climb towards 5575.00, the Mar 3 high (cont) and key resistance. Moving average studies are in a bull-mode position, highlighting an uptrend. Support to watch lies at 5373.59, the 50-day EMA.
