EURJPY TECHS: Impulsive Sell-Off
- RES 4: 144.00 Round number resistance
- RES 3: 143.16 61.8% retracement of the Dec 15 - Jan 3 bear leg
- RES 2: 142.86/94 High Jan 11 / High Dec 28 and key resistance
- RES 1: 140.40/141.53 Intraday high / 20-day EMA
- PRICE: 138.10 @ 16:03 GMT Jan 13
- SUP 1: 138.02 Low Jan 13
- SUP 2: 137.39 Low Jan 3 and the bear trigger
- SUP 3: 137.03 Low Aug 29
- SUP 4: 136.02 Low Aug 25
EURJPY traded sharply lower Friday and remains weak. This marks an extension of the impulsive move lower Thursday following the reversal from above the 50-day EMA, at 142.47. The move lower leaves key resistance at 142.94, the Dec 28 high, intact. An extension would open 137.39, the Jan 3 low, where a break would resume the 2-month downtrend and open 137.03, the Aug 29 low. Clearance of 142.94 is required to signal a reversal.
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US TSYS: Bonds Bouncing
Bonds bounce (30YY 3.5315) back above pre-FOMC levels as Fed Chairman Powell, answers question over size and pace of future hikes to bring inflation back to 2%. After raising 425bp this year, Powell said "we're into restrictive territory, it's now not so important how fast we go. It's far more important to think what is the ultimate level and then at a certain point, the question will become how long do we remain restrictive."
Yield curves flatter as short end lagging bounce so far.
- 3M10Y +2.627, -84.96 (L: -98.936 / H: -82.129)
- 2Y10Y -3.111, -75.444 (L: -77.576 / H: -65.961)
- 2Y30Y -2.857, -72.079 (L: -75.785 / H: -59.826)
- 5Y30Y -0.958, -12.807 (L: -16.004 / H: -5.285)
US STOCKS: Extending Lower As Fed Chair Powell Discusses Labor
Stocks extend session lows as Fed Chairman Powell touches upon jobs market in press Conference:
"Job gains have been robust with employment rising by an average of 272,000 jobs per month over the last three months. Although job vacancies have moved below their highs and the pace of job gains slowed from earlier in the year, the labor market continues to be out of balance with demands substantially exceeding the supply of available workers."
Current markets:
- - DJIA down 325.57 points (-0.95%) at 33780.93
- - S&P E-Mini Future down 47 points (-1.16%) at 4009
- - Nasdaq down 162.5 points (-1.4%) at 11094.84
US: Inflation Breakeven Closes In On Year-To-Date Lows Post FOMC
- The FOMC statement/SEP helps drive the 10Y inflation breakeven more notably below the 2.25% level that had recently proved a barrier since mid-Nov, before rising on Powell’s Brookings remarks.
- At 2.20% (-5bp), it’s at lows since early October prior to payrolls strength and the last of the US CPI beats, close to sustained lows year to date although technically still off the brief low of 2.10%.
Source: Bloomberg
