EURUSD TECHS: Corrective Cycle
May-01 17:00
- RES 4: 1.1696 1.618 proj of the Feb 28 - Mar 18 - 27 price swing
- RES 3: 1.1625 1.500 proj of the Feb 28 - Mar 18 - 27 price swing
- RES 2: 1.1608 High Nov 9 2021
- RES 1: 1.1440/1573 High Apr 23 / 21 and the bull trigger
- PRICE: 1.1277 @ 16:18 BST May 1
- SUP 1: 1.1271 Low May 1
- SUP 2: 1.1251 20-day EMA and a key support
- SUP 3: 1.1144/1002 High Apr 3 / 50-day EMA and a pivot level
- SUP 4: 1.0805 Low Apr 3
The recent pullback in EURUSD is considered corrective and the trend structure is unchanged, it remains bullish. MA studies are in a bull-mode position signalling a dominant uptrend, and the latest move down is allowing an overbought condition to unwind. A resumption of gains would open 1.1608 next, the Nov 9 2021 high. Key support is at the 20-day EMA, at 1.1251. A break of this average would signal scope for a deeper corrective pullback.
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PIPELINE: Corporate Bond Update: $850M Kommunalbanken 4Y SOFR Priced
Apr-01 16:57
- Date $MM Issuer (Priced *, Launch #)
- 04/01 $1B *DBJ 5Y SOFR+59
- 04/01 $850M *Kommunalbanken Norway 4Y SOFR+41 (upsized from $500M)
- 04/01 $600M #Realty Income 10Y +118
- 04/01 $500M #Banco Votorantim 3Y 5.95%
- 04/01 $500M Nexa WNG 12Y +250
- 04/01 $Benchmark LPL Holdings 3Y +110, 5Y +128, 10Y +165
- 04/01 $Benchmark NRW Bank 5Y SOFR+49a
BONDS: EGBs-GILTS CASH CLOSE: Yields Drop Ahead Of US Tariff Announcement
Apr-01 16:56
European curves bull flattened Tuesday.
- There was no clear headline driver of a strong overnight rally whose gains were held through most of the session. Attribution was largely placed on anticipation of the April 2 tariff announcement by US President Trump, though equities remained bid through much of the day and periphery EGBs outperformed.
- Weak-leaning US data toward the cash close (including a contractionary ISM Manufacturing index) saw Bunds and Gilts near session highs again before fading those gains slightly.
- March Eurozone flash inflation and manufacturing PMIs for Italy and Spain came slightly below consensus, though Eurozone labour market readings were solid.
- On the day, Bunds outperformed Gilts, with bull flattening in both curves. Periphery/semi-core EGB spreads tightened.
- Wednesday's calendar highlight is US President Trump's highly anticipated tariff announcement (2100BST, well after the European cash close), while we also get some Spanish labour market data and hear from multiple ECB speakers including Schnabel.
Closing Yields / 10-Yr EGB Spreads To Germany
- Germany: The 2-Yr yield is down 2.5bps at 2.022%, 5-Yr is down 3.5bps at 2.304%, 10-Yr is down 5.1bps at 2.687%, and 30-Yr is down 6bps at 3.03%.
- UK: The 2-Yr yield is down 2.2bps at 4.174%, 5-Yr is down 3bps at 4.254%, 10-Yr is down 4.1bps at 4.634%, and 30-Yr is down 3.5bps at 5.247%.
- Italian BTP spread down 2.7bps at 110.2bps / French OAT down 0.9bps at 71.6bps
OPTIONS: Multiple Call Vs Put Structures In Rates Tuesday
Apr-01 16:52
Tuesday's Europe rates/bond options flow included:
- ERK5 97.75/97.6875ps, bought for 1.25 in 6k
- ERM5 97.875/98.00cs, sold at 5.25 in 7k.
- ERZ5 98.0625/98.25cs vs 97.75/97.50ps, bought for 3.5 in 7k.
- ERZ5 98.0625/98.25cs vs 97.75p, bought the cs for 2 in 10.5k vs 3.99k at 98.075.
- ERZ5 98.06/98.25 cs vs 97.75/97.50 ps, bought the cs for 3.5 and 4 in 24k total
- ERM6 98.875/99.00/99.375c ladder, bought for -1 in 2k
- 0RJ5/0RK5 98.00/98.12cs vs 97.5625p, bought the May for 0.25 in 10k
- SFIM5 95.60/95.70/95.95/96.05c condor, sold at 6.5 in 3k
- SFIU5 96.00/96.10cs v 95.50/95.40ps, sold the cs at 3.5 in 4k
- 0NU5 97.00c Bought for 5.75 and 6 in 20k
