EURGBP TECHS: Bull Cycle Remains Intact
- RES 4: 0.8893 2.000 proj of the Sep 15 - 25 - Oct 8 price swing
- RES 3: 0.8875 High Apr 25
- RES 2: 0.8868 61.8% retracement of the 2022 - 2024 bear leg
- RES 1: 0.8865 High Nov 14
- PRICE: 0.8791 @ 16:20 GMT Nov 21
- SUP 1: 0.8791 20-day EMA
- SUP 2: 0.8769 Low Nov 10
- SUP 3: 0.8746 50-day EMA
- SUP 4: 0.8706 Low Oct 24 and a key support
The trend outlook in EURGBP remains bullish. A fresh cycle high on Nov 14 reinforces the uptrend and maintains the price sequence of higher highs and higher lows. Sights are on 0.8868 next, a Fibonacci retracement point. On the downside, initial key short-term support to monitor lies at 0.8791, the 20-day EMA - a level briefly pierced on Friday. A clear break of the average would signal scope for a deeper retracement
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US TSY OPTIONS: Late 5Y, 10Y Call Spreads - Conditional Steepener
- +20,000 FVZ5 110.5/111.5 call spds, 10
- -15,000 TYZ5 114/116 call spds, 28
US: US Corporations Optimistic About Economy
Semafor reports, “US corporations appear optimistic about the country’s economy, marking a turnaround from CEOs’ post-“Liberation Day” warnings. In this week’s slew of earnings reports, companies ranging from automakers (General Motors) to defense firms (Northrop Grumman) to consumer giants (Phillip Morris) raised their profit outlooks.”
- Semafor continues, “The disclosures offer investors critical signals about the US’ economic health in the absence of government data during the federal shutdown. And thanks to a “resilient customer base,” spending is also likely to hold up during the upcoming Western holiday season, Walmart US’ CEO told Semafor last week. The upbeat reports have sent stocks to record highs, though analysts are watching whether the ongoing shutdown and Big Tech earnings next week could cool that momentum.”
Figure 1: US Consumer Sentiment Index
Source: Semafor, University of Michigan, Federal Reserve Bank of St. Louis
US OUTLOOK/OPINION: A Slightly Hawkish Update To CPI Expectations For Friday
Updating the analyst tables from the MNI US CPI Preview to include two more hawkish unrounded entries from Morgan Stanley and NatWest.
- The median unrounded estimate shifts from 0.40 to 0.41% M/M for headline and from 0.30 to 0.32% M/M for core CPI in September.
- The latter narrows the expected moderation from what was a slight upward surprise of 0.35% M/M in August.
