EQUITIES: EU Cash Opening Calls
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STIR: Less Than 35bp Of BoE Hikes Priced On Latest Ceasefire News
Dovish repricing in GBP STIRs as oil sells off alongside a bid in stocks and bonds after the agreement of a two-week ceasefire between the U.S., Israel & Iran, contingent on safe passage through the Strait of Hormuz. Related talks are set to take place in Pakistan on Friday.
- While the risk of the resumption of bombing remain evident (given the potential for ongoing differences between the two sides), markets are comfortable unwinding some of the stagflationary pricing that had become embedded in recent weeks.
- BoE-dated OIS now pricing ~33.5bp of tightening through November vs. ~60bp of tightening through year-end at yesterday’s close. Contracts covering ’26 meetings are 6-27bp less dovish on the day, with just 4bp of tightening now priced for this month.
- SONIA futures are 3.5-36.5 higher vs. settlement, with the reds leading the rally. SFIZ6 clears the March 19 high. Contract is ~10.0 away from closing the March 19 opening gap lower (96.035) after rallying over 70.0 from March lows.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA (bp) |
Apr-26 | 3.770 | +4.0 |
Jun-26 | 3.880 | +15.0 |
Jul-26 | 3.981 | +25.1 |
Sep-26 | 4.047 | +31.7 |
Nov-26 | 4.065 | +33.5 |
Dec-26 | 4.054 | +32.4 |
Feb-27 | 4.043 | +31.3 |
Mar-27 | 4.041 | +31.1 |
Apr-27 | 4.031 | +30.1 |
US TSY OPTIONS: TYWJ26 111.25 Calls Sold
TYWJ26 111.25 calls ~6K sold at 0-24/0-22, could be cover of an existing position with OI just under 20K as of yesterday. These calls expire today.
GOLD TECHS: Breaches The 50-Day EMA
- RES 4: $5107.6 - 76.4% retracement of the Mar 2 - 23 bear leg
- RES 3: $5000.0 - Round number resistance
- RES 2: $4914.9 - 61.8% retracement of the Mar 2 - 23 bear leg
- RES 1: $4856.8 - Intraday high
- PRICE: $4832.5 @ 07:34 BST Apr 8
- SUP 1: $4554.2 Low Apr 2 and a key short-term support
- SUP 2: $4420.1 - Low Mar 30
- SUP 3: $4306.4 - Low Mar 24
- SUP 4: $4099.2 - Low Mar 23 and the bear trigger
Recent gains in Gold appear to be corrective, however for now, the short-term bull cycle remains intact and today’s gains strengthen the upleg. The metal has traded through the 50-day EMA, at $4785.74. This signals scope for an extension towards $4914.89, a Fibonacci retracement point. Clearance of this level would open the $5000.0 handle. Initial firm support to watch lies at $4554.2, the Apr 2 low. A break would be bearish.
