EUROZONE ISSUANCE: EGB Supply (1/2)

• RES 4: 1.3868 High Jan 27 and the bull trigger    
• RES 3: 1.3814 High Jan 30
• RES 2: 1.3733 High Feb 4  
• RES 1: 1.3613/3712 20-day EMA / High Feb 11
• PRICE: 1.3548 @ 16:21 GMT Feb 18
• SUP 1: 1.3532 50-day EMA
• SUP 2: 1.3496 Low Feb 17
• SUP 3: 1.3458 76.4% retracement of the Jan 19 - 27 upleg 
• SUP 4: 1.3402 Low Jan 22  

GBPUSD sold off sharply Tuesday resulting in a show below key support around the 50-day EMA, at 1.3531. A clear break of this average would undermine the bull theme and highlight scope for a stronger retracement. This would open 1.3458, a Fibonacci retracement. It is still possible that the latest pullback is a correction. Key short-term resistance to watch is 1.3712, the Feb 11 high. Clearance of this hurdle would be a bullish development.

• Fed Funds implied rates have pared earlier increases for nearer-term meetings, back to unchanged for the June FOMC despite a continued push higher in WTI futures (1st contract now +4.6%), but are 2bp higher for the Dec FOMC.
• Cumulative cuts 1.5bp Mar, 6bp Apr, 19.5bp Jun, 29bp Jul, 42bp Sep, 50bp Oct and 58bp Dec.
• SOFR futures range from 0.5-4 ticks lower looking to end-2027, with a terminal implied yield of 3.065% (H7, +3.5bp) for a little further from Friday's 3.005% lowest close since late November.
• Today’s data releases saw upside surprises for core durable goods orders, housing starts/building permits and IP. Despite that, the Atlanta Fed’s GDPNow for Q4 was unchanged at 3.6% annualized although the composition was a little more solid.
• As noted above, the FOMC minutes are still to come at 1400ET. Preview: https://mni.marketnews.com/4kI6WzS
• Fed VC Supervision Bowman (voter, dove) is also currently speaking in a discussion on supervision and regulation. She said on Monday that Friday's inflation data were "a little softer" than most expected but in line with her expectations. "Since I see the current policy stance as moderately restrictive, I do think there's room for at least 75bp of more cuts in 2026 […] that's what I wrote into my forecasts last December".

• Date $MM Issuer (Priced *, Launch #)
• 02/18 $2.2B #PG&E $400M 2029 tap +73, $1B 10Y +115, $800M 30Y +132
• 02/18 $1.6B #DTE Electric $800M 10Y +78, $800M 30Y +85
• 02/18 $1.5B #Avalon Holdings $750M 3Y +83, $750M 7Y +115
• 02/18 $1.45B #Marriott Intl $600M 7Y +80, $850M 12Y +110
• 02/18 $1.3B #Caterpillar $350M 3Y +30, $950M 3Y SOFR+49
• 02/18 $1.3B #Cote d'Ivoire 14Y 7.125%
• 02/18 $775M #Exelon 10Y +92
• 02/18 $750M #Synchrony Financial 6NC5 +130
• 02/18 $650M #Indiana/Michigan Power WNG 30Y +92
• 02/18 $Benchmark ABN Amro 5Y +55, 10Y +75
• 02/18 $Benchmark Goldman Sachs Private Cr 2Y +185, Tap 01/31 +260
• 02/18 $500M Genesis Energy 8NC3 6.875%