FRANCE AUCTION PREVIEW: LT OATs Due This Morning

• RES 4: 95.57 High Dec 11 ‘24 (cont)     
• RES 3: 95.00 Round number resistance      
• RES 2: 94.75 76.4% retracement of the Dec 3 - Jan 13 bear leg (cont)
• RES 1: 94.80 Intraday high                       
• PRICE: 94.30 @ 08:10 BST Apr 7
• SUP 1: 93.01 High Mar 20                                      
• SUP 2: 92.13 20-day EMA  
• SUP 3: 91.59 Low Mar 31   
• SUP 4: 91.03 Low Mar 28

Gilt futures maintain a firmer tone and the contract is trading at its recent highs. A key resistance at 93.79, the Mar 4 high, has been cleared and this has been followed by a move through the 94.00 handle. The breach signals scope for a climb towards 94.75, 76.4% of the Dec 3 - Jan 13 bear leg (cont). On the downside, initial support lies at 93.01, the Mar 20 high. A firmer support is seen at 92.13, the 20-day EMA.

They heavy risk-off price action, driven by continued trade war worry and hardline tariff rhetoric from the Trump administration, promotes dovish repricing in USD STIRs.

• Pricing across ’25 Fed meetings shows ~19.5bp cuts for May, 49bp through June, 77bp through July, 97bp through September. 111bp through October and 125bp through December.
• Fed Funds now price ~24bp of additional easing through December ’25 vs. Friday’s closing levels, essentially adding one full cut into pricing over that horizon (pricing is a couple of bp more dovish than levels that prevailed ahead of Friday’s NFP release). 

• RES 4: $34.903 - High Oct 23 ‘24 and the bull trigger 
• RES 3: $32.947/34.590 - 20-day EMA / High Mar 28 
• RES 2: $32.491 - 50-day EMA 
• RES 1: $30.815 - Low Feb 28                                     
• PRICE: $29.826 @ 08:15 BST Apr 7    
• SUP 1: $28.351 - Intraday low              
• SUP 2: $27.686 - Low Sep 6 ‘24 
• SUP 3: $27.180 - Low Aug 14 ‘24   
• SUP 4: $26.451 - Low Aug 8 ‘24 and a key support   

Silver continues to trade in a volatile manner. Last week’s sell-off confirmed a clear reversal of its recent uptrend. The metal has today traded through support at $28.748, the Dec 19 low. A clear break of this level would signal scope for a continued sell-off, towards $27.686, the Sep 6 ‘24 low. Initial resistance to watch is $30.815, the Feb 28 low. The contract is oversold, gains would allow this set-up to unwind.