COMMODITIES: Gold Extends Recovery Off Tuesday's Lows
WTI futures are trading below recent highs, however, a short-term corrective bull cycle remains in play. Price has recently traded through resistance at the 50-day EMA, currently at $60.97. The breach of this EMA signals scope for a stronger recovery. Note too that a resistance at $62.34, the Oct 8 high, has also been pierced. A clear move through it would expose key resistance at $65.77, Sep 26 high. The bear trigger is unchanged at $55.96, Oct 20 low. A fresh cycle low recently in Gold highlights an extension of the bear cycle that started Oct 20. The move down since Oct 20 has allowed an overbought trend condition to unwind. The 20-day EMA has been breached, signalling scope for a test of the 50-day EMA, at $3871.7 - a key pivot support. Clearance of this EMA would strengthen a short-term bear theme. Initial resistance is at $4161.4, the Oct 22 high.
- WTI Crude up $0.49 or +0.82% at $60.08
- Natural Gas up $0.07 or +1.75% at $4.311
- Gold spot up $28.2 or +0.71% at $4007.71
- Copper up $2.65 or +0.53% at $501.25
- Silver up $0.57 or +1.19% at $48.5988
- Platinum up $3.66 or +0.23% at $1566.77
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BUNDS: German 2s/5s Swap Curve Trade
- DUZ5 ~8.1k at 107.00 (suggest receiver).
- OEZ5 ~2.8k at 117.78 (suggest payer).
EURIBOR OPTIONS: Call Spread with Put Spread strip
EURM6 98.1875/98.25cs 1x1.75 with ERH6 98.00/97.9375ps sold as a strip at 1 in 4k.
GERMAN AUCTION RESULTS: Disappointing Bobl Auction
- The 1.11x bid-to-cover achieved at today's auction of the 2.20% Oct-30 Bobl was the joint lowest at a Bobl auction since July 2021 (1.11x was also reached in July 2022). Bid-to-offer also very weak at 0.84x.
- Demand metrics were similarly weak for other parts of the German curve recently but this has been the first time this has filtered through to the extent seen today to the Bobl segment.
- The low price achieved at the auction (99.48) was above the secondary market mid-price right before the cutoff (99.467), at least.
- No discernible price impact of the weak results on the line, this is not untypical for German auctions.
