CANADA: JAPAN-Nikkei: Takaichi & Carney Set To Upgrade Ties In 6 March Meeting
Nikkei reports that Japan and Canada are set to announce the upgrading of formal relations to a "comprehensive strategic partnership" during Canadian PM Mark Carney's visit to Tokyo on 6 March, where he will hold talks with his Japanese counterpart, Sanae Takaichi. Carney has used this week's visit to Asia, comprising stops in India, Australia and now Japan, to bolster relations and chart a geopolitical path for Canada as a 'middle power'. Speaking to the Australian Parliament in Canberra on 4 March, Carney said the post-war "global architecture [is] breaking down from consecutive crises".
- Nikkei reports the two countries will also establish a "policy consultation on cybersecurity. They will regularly exchange and analyze information on the methods of attacks by China and Russia. Canada has some of the world's best cyber defense capabilities. Japan will seek to share its know-how with Canada, which will lead to the strengthening of its defense capabilities." These policies will be included in the first joint statement by Canadian and Japanese PM's in 21 years.
- Japan Times notes the Takaichi gov't will view closer Canadian ties as "useful primarily to the extent that it strengthens the U.S.-Japan alliance and helps anchor American power in the Pacific." However, the two sides have taken different stances vis-a-vis the US. Japan under Takaichi has sought to demonstrate its position as a contributor to, rather than a drain on, US security. Canada, on the other hand, has adopted the 'elbows up' strategy of criticising US protectionism and rhetoric, with ties remaining at a multi-decade low.
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GILTS: Outperforming Peers
Gilts a little more resilient than core global FI peers in recent trade, resulting in UK outperformance on the day at the 10-Year point.
- Solid demand at this morning’s gilt auction provided support earlier today, with UK-specific news limited in the time since.
- Bulls haven’t been able to force closure of the opening gap lower (~91.05), with the contract sticking within yesterday’s range.
- Curve bear steepens on the day, albeit with yields only flat to 1.5bp higher. 10s remain tethered to 4.50%, while the ’25 closing high on the 2s10s curve remains intact on a closing basis (81.63bp).
EQUITY TECHS: E-MINI S&P: (H6) Trend Structure Remains Bullish
- RES 4: 7141.7 1.236 proj of the Dec 18 - Jan 13 - 21 price swing
- RES 3: 7100.00 Round number resistance
- RES 2: 7080.92 0.764 proj of the Nov 21 - Dec 11 - 18 price swing
- RES 1: 6965.75/7043.00 Intraday high / High Jan 28 and bull trigger
- PRICE: 7008.00 @ 14:32 GMT Feb 3
- SUP 1: 6864.50 Low Feb 2
- SUP 2: 6814.50 Low Jan 21 and the bear trigger
- SUP 3: 6771.50 Low Dec 18 and a key support
- SUP 4: 6684.50 Low Nov 24
The trend in S&P E-Minis is bullish and Monday’s strong gains reinforce this theme. The move higher also suggests that the recent bear threat merely resulted in a short lived correction. Attention is on key resistance and the bull trigger at 7043.00, the Jan 28 high. A break of this level would confirm a resumption of the primary uptrend and open 7080.92, a Fibonacci projection. Key support and a bear trigger has been defined at 6814.50, the Jan 21 low.
USDJPY TECHS: Testing Resistance At The 50-Day EMA
- RES 4: 159.45 High Jan 14 and the bull trigger
- RES 3: 159.23 High Jan 23
- RES 2: 157.43 Low Jan 19
- RES 1: 155.75/156.08 50-day EMA / Initraday high
- PRICE: 155.92 @ 14:36 GMT Feb 3
- SUP 1: 152.10 Low Jan 27 and the bear trigger
- SUP 2: 151.98 38.2% of the Apr 22 ‘25 - Jan 14 bull cycle
- SUP 3: 151.54 Low Oct 29 ‘25
- SUP 4: 150.99 Trendline support drawn from the Apr 22 ‘25 low
Short-term trend conditions in USDJPY are unchanged and a bear cycle remains intact. However, for now, a corrective cycle is in play and the latest recovery has allowed a recent oversold condition to unwind. Firm resistance to watch is at 155.75, the 50-day EMA. It has been pierced, a clear break of this average would signal a possible bullish reversal. Key short-term support has been defined at 152.10, the Jan 27 low.
