USDJPY TECHS: Bull Cycle Remains In Play

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.

For the full MNI EGB Supply Daily with a recap of issuance so far this week and a look ahead to the next two weeks of issuance, click here.

• 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).

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.

• 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.