EQUITY TECHS: E-MINI S&P: (U5) Bull Cycle Remains In Play
- RES 4: 6402.44 1.382 proj of the May 23 - Jun 11 - 23 price swing
- RES 3: 6381.00 1.764 proj of the Apr 7 - 10 - 21 price swing
- RES 2: 6356.12 1.236 proj of the May 23 - Jun 11 - 23 price swing
- RES 1: 6333.25 High Jul 3
- PRICE: 6305.75 @ 14:40 BST Jul 9
- SUP 1: 6235.50 Low Jul 2
- SUP 2: 6163.03/6021.72 20- and 50-day EMA values
- SUP 3: 5811.50 Low May 23
- SUP 4: 5645.75 Low May 7
The trend condition in S&P E-Minis remains bullish and the contract is holding on to the bulk of its recent gains. Resistance at 6128.75, the Jun 11 high, has recently been breached. The break confirmed a resumption of the uptrend that started Apr 7. This was followed by a breach of key resistance and a bull trigger at 6277.50, the Feb 21 high. Sights are on 6356.12, a Fibonacci projection. Key support is at the 50-day EMA, at 6021.72.
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PIPELINE: Corporate Bond Roundup
- Date $MM Issuer (Priced *, Launch #)
- 06/09 $1.2B Whirlpool 5NCL, 8NCL
- 06/09 $Benchmark Amphenol 3Y +65a
- 06/09 $Benchmark Sammons Financial 5Y +110a
- 06/09 $Benchmark Air Products 3Y +60a, +7Y +90a
- 06/06 No new issuance Friday, $51.1B/wk
SWAPS: Late Friday Spread Widening Unwound
UK swap spreads have narrowed today, with the front end under the most pressure.
- The moves represent an unwind of the spread widening that was seen into Friday’s close, when gilts found a bit of a base.
- Today’s narrowing is modest in most cases and doesn’t seem to have much of a fundamental driver, with an intraday focus on the uptick in outright gilt yields.
- Long end gilt yields have broken Friday’s highs in recent trade, which applied fresh pressure to long end swap spreads, before some stabilisation was seen.
- Zooming out, 30-Year swap spreads operate around ’25 highs, but continue to respect -80bp during any widening episodes.
- Further forwards, the 10-Year swap spread remains pinned around -50bp, while bounces in 2-Year swap spreads lack traction during any widening episodes away from multi-year lows.
- A reminder that Chancellor Reeves will unveil the spending review on Wednesday.
- Unlike a Budget or Spring Statement, the spending review will not contain new forecasts from the OBR, nor will it announce new tax and spending measures. Instead, Reeves will detail the spending allocations for individual government departments over the next several years.
- The review is fraught with risks for both Reeves & PM Starmer, given its ability to promote Cabinet tension, in addition to dissent from the backbenchers.
- Medium-term, while the domestic fiscal situation remains fragile, increased policymaker sensitivity to spikes higher in long end yields and a more active approach when it comes to mitigating such instances, provide mixed inputs for swap spreads.
- Meanwhile, short-run sensitivity to any U.S. moves (with a particular focus on regulatory/SLR reform) presents a wildcard from abroad.
EQUITY TECHS: E-MINI S&P: (M5) Fresh Cycle High
- RES 4: 6124.00 High Feb 24
- RES 3: 6080.75 High Feb 26
- RES 2: 6057.00 High Mar 3
- RES 1: 6025.00 High June 6
- PRICE: 6015.50 @ 14:24 BST Jun 9
- SUP 1: 5883.97/5789.71 20- and 50-day EMA values
- SUP 2: 5756.50 Low May 23
- SUP 3: 5596.00 Low May 7
- SUP 4: 5455.50 Low Apr 30
The trend condition in S&P E-Minis is unchanged, it remains bullish and the contract traded to a fresh cycle high last week. The recent break of 5993.50, the May 20 high and a bull trigger, highlights a resumption of the uptrend and maintains a price sequence of higher highs and higher lows. A continuation would open 6057.00 next, the Mar 3 high. Key support lies at 5789.71, the 50-day EMA.
