EMERGING MARKETS: CEEMEA FX Price Signal Summary: USDZAR Trend Needle Still Points North
Aug-31 11:29
- The short-term outlook in EURHUF remains bullish and the latest pullback is considered corrective. Recent gains have defined a key short-term support at 391.55, Aug 12 low. The focus is on key resistance at 416.89, the Jul 7 high, where a breach would confirm a resumption of the primary uptrend. Sub 391.55 levels would threaten the trend. Initial support to watch is at 400.75, the 50-day EMA.
- EURPLN attention remains on the first important resistance at 4.8088, the Jul 27 high. A break of this level would strengthen the case for bulls and expose 4.8515, the Jul 12 high. Key short-term support has been defined at 4.6528, the Aug 15 low. A move below this level would instead be bearish.
- USDZAR short-term conditions remain bullish following the latest recovery and bounce from 16.1104, the Aug 11 low. A continuation higher would open 17.3060, the Jul 14 high and a bull trigger. Key support lies at the trendline drawn from the Apr 13 low - it intersects at 16.2076. Initial firm support lies at 16.5744, the 50-day EMA.
- USDTRY is unchanged but trend conditions remain bullish, following the recent clearance of the 18.00 handle. The continued appreciation signals scope for a climb towards 18.3633, the Dec 20 2021 high and a key resistance. The 20-day EMA, at 18.0137, is the initial firm support to watch.
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US EURODLR FUTURES: Post-LIBOR Settle Update: Benchmark Rebounds
Aug-01 11:10
Lead quarterly EDU2 trades -0.015 at 96.685 after latest 3M LIBOR set' rebounds +0.01385 to 2.80214%, still off last Wed's 3.5Y high: 2.80586% (+0.02200 total last wk). The 3M benchmark had gapped lower Thu after the FOMC delivered a second consecutive 75bp hike while scaling back hawkish forward guidance for Sep.
- Nevertheless, balance of Whites through Reds (EDU2-EDM4) trade -0.015-0.030, Greens through Golds (EDU4-EDM7) steady to +/-0.010 with Blues outperforming.
- Front end inversion extends: Dec'22/Mar'23 at -0.175. Most inverted calendar spds: EDZ2/EDZ3 at -0.565, EDH3/EDH4 at -0.705. Inversion starts to flatten out in Green Jun'25 vs. Blue Sep trading steady.
- Limited option volumes reported Friday, two-way trade as underlying futures climbed off late overnight lows. Salient trade: -4,500 Dec 97.37 straddles, 1,250 Green Sep 96.87/97.00/97.12/97.25 put condors, Block, 7,000 98.00/99.00 call spds, 2.0 ref 96.965.
LIBOR: US FIX - 01/08/22
Aug-01 11:00
- US00O/N 2.31157 -0.01000
- US0001M 2.36686 0.00457
- US0003M 2.80214 0.01385
- US0006M 3.37614 0.04628
- US0012M 3.74214 0.03485
US TSYS: Bonds Weaker, Focus on ISMs, Geopol Risks: Pelosi's Asia Tour
Aug-01 10:54
Tsy futures trading steady/mixed in the lead-up to the NY open, inside overnight range with short end outperforming, bonds weaker (30YY 3.0146 +.0049). Very light overnight volumes to kick off new week, TYU2<225k at the moment.
- Muted knock-on react to sub-50 PMIs for Italy, France, Germany, Eurozone in early London trade, focus turns to US data at midmorning:
- S&P Global US Manufacturing PMI (52.3 est) at 0945ET followed by Construction Spending MoM (0.3% est) and ISMs at 1000ET: Mfg (52.0 est) Prices Paid (73.5 est), New Orders (49.0 est), Employment (48.2 est).
- No scheduled Fed speakers at the moment does not preclude pop-up speaker interviews, op-eds (MN Fed Kashkari late Fri: "we are a long way away from" getting "inflation back down to 2 percent".
- No immediate react to CNN headline that US House speaker Pelosi "expected to visit Taiwan" on her whirlwind tour of Indo-Pacific countries: Malaysia, Japan, South Korea.
- Cross assets: spot Gold +6.50 at 1772.44, Crude weaker WTI -1.52 at 97.10, stocks weaker but off overnight lows: ESU2 -10.00 at 4123.50 after climbing to highest levels since June 9 last Fri. Earnings resume while most anncd after todays close.
- Currently, 2-Yr yield is up 1.4bps at 2.8985%, 5-Yr is up 1.3bps at 2.6894%, 10-Yr is up 1.1bps at 2.6595%, and 30-Yr is up 1.5bps at 3.0244%.
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