EURGBP TECHS: Corrective Phase
- RES 4: 0.8840 High Nov 20
- RES 3: 0.8818 High Nov 26
- RES 2: 0.8802 High Dec 2 and a key near-term resistance
- RES 1: 0.8766 20-day EMA
- PRICE: 0.8737 @ 16:30 GMT Dec 10
- SUP 1: 0.8721 Low Dec 8
- SUP 2: 0.8706 76.4% retracement of the Oct 8 - Nov 14 bull leg
- SUP 3: 0.8670 Low Oct 21
- SUP 4: 0.8656 Low Oct 8 and a key support
A corrective bear cycle in EURGBP remains intact - for now. The cross has breached the 50-day EMA, currently at 0.8752. The break highlights a stronger reversal and a bear threat, plus scope for a deeper retracement, towards 0.8706, a Fibonacci retracement. Initial firm resistance to watch is unchanged at 0.8802, the Dec 2 high. Clearance of this hurdle would be a bullish development and signal a resumption of the uptrend.
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EURGBP TECHS: Bullish Structure
- RES 4: 0.8865 1.764 proj of the Sep 15 - 25 - Oct 8 price swing
- RES 3: 0.8848 1.618 proj of the Sep 15 - 25 - Oct 8 price swing
- RES 2: 0.8835 High May 3 2023
- RES 1: 0.8830 High Nov 5
- PRICE: 0.8779 @ 16:13 GMT Nov 10
- SUP 1: 0.8763 Low Nov 3
- SUP 2: 0.8754 20-day EMA
- SUP 3: 0.8716 50-day EMA
- SUP 4: 0.8656 Low Oct 8 and a key support
A bullish condition in EURGBP remains intact and recent gains reinforce current conditions. The move higher has confirmed a resumption of the uptrend and maintains a bullish price sequence of higher highs and higher lows. Sights are on 0.8835, the May 3 2023 high. Initial support lies at 0.8763, the Nov 3 low and just above the 20-day EMA, at 0.8755. Note that the trend is overbought, a pullback would be considered corrective.
PIPELINE: Corporate Bond Update: Near $20B to Price Monday
$19.95B To Price Monday:
- Date $MM Issuer (Priced *, Launch #)
- 11/10 $11B #Verizon: $2B +7Y +90, $2.25B +10Y +100, $1.5B 20Y +110, $3.25B 30Y +120, $2B 40Y +130
- 11/10 $1.65B #Enterprise Products Op $300M 3Y Tap +43, $600M 5Y Tap+73, $750M 10Y tap +93
- 11/10 $1.6B #Caterpillar $1.05B 3Y +37, $550M 3Y SOFR+58
- 11/10 $1.5B #LyondellBasell $500M 5Y +145, $1B 10Y +185
- 11/10 $900M *Mosaic $500M +3Y +77, $400M 5Y +92
- 11/10 $750M #Flex $150M 7Y +105, $600M 10Y +130
- 11/10 $750M #Plains All American $300M 5Y +102, $450M 10Y +142
- 11/10 $700M Carpenter Tech 8.25NC3.25 5.75%
- 11/10 $600M #AutoNation +3Y +90
- 11/10 $500M #Illumina WNG 5Y +105
- 11/10 $2.35B Applied Digital 5NC2 investor call, expected to launch Thursday
STIR: Fed Rates Await A New Driver As End Of Shutdown Looks More Likely
- Fed Funds implied rates hold the day’s increase, 1-2bp higher from Friday’s close, on the back of improved optimism around the government shutdown ending and talk of $2k tariff dividends.
- Cumulative cuts from 3.87% effective: 15.5bp Dec, 25bp Jan, 34.5bp Mar, 41.5bp Apr and 55.5bp Jun.
- SOFR futures meanwhile have marginally pared some of their overnight losses (sitting up to 3.5 ticks lower) despite equity futures extending gains through the session.
- The terminal implied yield is at 3.105% (H7, +3.5bp) as it holds off Wednesday’s 3.16% which marked the highest close since late July (following beats for ADP and ISM services before weaker alternate labor data and consumer sentiment over Thu-Fri).
- We recapped the wide array of labor indicators for October, which have held greater than usual sway on markets recently, in our shadow Employment Report published earlier today: https://media.marketnews.com/US_Shadow_Employment_Report_Nov_docx_cceb084370.pdf
- Improved odds of the shutdown ending see a greater likelihood that the BLS nonfarm payrolls report for back in September is released in the next week or so.
