EURJPY TECHS: Bullish Extension
- RES 4: 157.84 2.236 proj of the Mar 20 - 31 - Apr 6 price swing
- RES 3: 157.53 1.764 proj of the May 11 - 29 - 31 price swing
- RES 2: 156.79 1.618 proj of the May 11 - 29 - 31 price swing
- RES 1: 156.62 High Jun 22
- PRICE: 156.16 @ 16:49 BST Jun 22
- SUP 1: 154.05 Low Jun 20
- SUP 2: 153.09 Low Jun 16
- SUP 3: 151.84 20-day EMA
- SUP 4: 150.92 Low Jun 14
EURJPY traded higher Thursday, once again confirming a resumption of the current uptrend. The move strengthens bullish conditions and extends last week’s impulsive rally. Price has recently cleared key resistance at 151.61, the May 2 high and an important bull trigger. This confirmed a resumption of the longer-term uptrend and the focus on 156.79 next, a Fibonacci projection. Initial key support is seen at 151.84, the 20-day EMA.
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EURJPY TECHS: Bull Cycle Still In Play
- RES 4: 152.00 1.382 proj of the Mar 20 - 21 - Apr 6 price swing
- RES 3: 151.61 High May 2 and the bull trigger
- RES 2: 150.32 76.4% retracement of the May 2 - 11 bear leg
- RES 1: 150.06 High May 23
- PRICE: 149.41 @ 16:05 BST May 23
- SUP 1: 148.26 20-day EMA
- SUP 2: 146.69/13 50-day EMA / Low May 11
- SUP 3: 145.67 High Mar 31
- SUP 4: 145.22 2.0% 10-dma envelope
EURJPY maintains a short-term bullish tone. A continuation higher would signal scope for a climb towards 150.32 next, a Fibonacci retracement, ahead of 151.61, the May 2 high and a bull trigger. The 50-day EMA, which intersects at 146.69 Tuesday, remains intact and marks a key support. A clear break of this average is required to signal a resumption of bearish activity. Initial support lies at 148.26, the 20-day EMA.
US TSY FUTURES: Late Jun/Sep Roll Update: Heavy Volumes
Heavy roll volume in the second half, percentage complete near 25%. Sep'23 futures take lead quarterly position on Wednesday, May 31 (First notice date). Current markets:
- TUM/TUU 757,500 from -20.5 to -19.38, -20.38 last, 31% complete
- FVM/FVU 1,060,100 from -19.5 to -18.5, -18.75 last, 30% complete
- TYM/TYU 1,043,100 from -25.25 to -24.50, -24.50 last, 26% complete
- UXYM/UXYU 470,900 from -31.50 to -30.25, -31.25 last, 23% complete
- USM/USU 233,100 from -7.00 to -6.5, -7.0 last, 25% complete
- WNM/WNU 348,300 from -15.00 to -14.25, -15.0 last, 28% complete
- Reminder, June futures won't expire until next month: 10s, 30s and Ultras on June 21, June 30 for 2s and 5s.
CANADA: GoCs Maintain Sizeable Cheapening, 10Y Supply Tomorrow
- GoCs have reversed some of their earlier losses but continue to hold a large cheapening post Victoria Day, with 2Y-10Y benchmark yields some 9.5 to 11bps higher since Friday’s close.
- The 2Y leads the way after the sizeable steepening in the shorter rates curve with BAX 2023 inversion fully unwinding and currently on track for the first positive close in BAM3/Z3 (+0.04) since Mar 8 just as SVB issues first came to light. It sees the 2Y Can-US spread still relatively narrow at -22bps.
- The sizeable move has come despite only mixed cost price pressures for IPPI/raw materials whilst the weekly Nanos consumer confidence index continued to trend higher for its highest since May’22.
- 10Y supply headlines tomorrow’s CAD docket but with potential spillover from the FOMC minutes and of course any further debt talk headlines.
