BTP TECHS: (M5) Impulsive Rally
- RES 4: 121.93 76.4% of the Dec 5 ‘24 - Mar 14 bear leg (cont)
- RES 3: 121.43 1.618 proj of the Mar 14 - Apr 4 - 9 price swing
- RES 2: 121.04 1.500 proj of the Mar 14 - Apr 4 - 9 price swing
- RES 1: 120.65 1.382 proj of the Mar 14 - Apr 4 - 9 price swing
- PRICE: 120.53 @ Close Apr 24
- SUP 1: 119.42/118.72 High Apr 22 / 20-day EMA
- SUP 2: 117.28 Low Apr 10
- SUP 3: 116.06 Low Apr 9
- SUP 4: 115.75 Low Apr 14 and a bear trigger
BTP futures have traded higher this week and the contract maintains a bullish tone. Thursday’s strong rally reinforces current bullish conditions. The move higher has resulted in the break of key resistance at 120.39, the Feb 28 high. Sights are on 120.65 next, a Fibonacci projection. Firm support to watch lies at 118.72, the 20-day EMA. The contract is overbought, a pullback would unwind this trend condition.
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EURUSD TECHS: Corrective Cycle
- RES 4: 1.1083 High Oct 2 2024
- RES 3: 1.1040 High Oct 4 2024
- RES 2: 1.0961 76.4% retracement of the Sep 25 ‘24 - Feb 3 bear leg
- RES 1: 1.0955 High Mar 18
- PRICE: 1.0787 @ 06:05 GMT Mar 26
- SUP 1: 1.0763 20-day EMA
- SUP 2: 1.0631 50-day EMA and a short-term pivot level
- SUP 3: 1.0471 Low Mar 4
- SUP 4: 1.0360 Low Feb 28 and a key support
EURUSD extends the pullback from its recent high. The move down is considered corrective and the trend condition is unchanged and remains bearish. Note that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.0961 next, a Fibonacci retracement. Clearance of this level would open 1.1040, the Oct 4 ‘24 high. First support to watch is 1.0763, the 20-day EMA.
BUND TECHS: (M5) Corrective Cycle Remains In Play
- RES 4: 130.40 Low Feb 19
- RES 3: 129.96 High Mar 5
- RES 2: 129.41 Low Jan 14 and a key short-term resistance
- RES 1: 128.72 20-day EMA
- PRICE: 128.01 @ 05:46 GMT Mar 26
- SUP 1: 127.20/126.53 Low Mar 17 / 11 and the bear trigger
- SUP 2: 126.28 2.618 proj of the Feb 5 - 19 - 28 price swing
- SUP 3: 126.00 Round number support
- SUP 4: 123.36 3.00 proj of the Feb 5 - 19 - 28 price swing
Bund futures are holding on to the bulk of their recent gains. Resistance remains intact and - for now - the latest move higher is considered corrective. The move higher has allowed an oversold trend condition to unwind. Initial firm resistance to watch is seen at 129.41, the Jan 14 low. A recent impulsive sell-off reinforced a bear theme and signals scope for an extension towards 126.28 next, a Fibonacci projection. Further out, 126.00 is also within range.
CHINA: Country Wrap: Bond Connect to Expand.
- A government advisor to the China Government has suggested that China should raise consumption to a level close to that of developed countries over the next decade (source: BBG)
- The HKMA has announced that an approval in principle agreement has been reached to expand the southbound bond connect for non-bank institutions giving more investors access to Chinese Government bonds. (source: BBG).
- China’s Hang Seng led the way today rising +0.25% after yesterday’s dramatic fall. The CSI 300 didn’t follow suit and oscillated around where it started for the trading day whilst the Shanghai Composite rose +0.20% and Shenzhen was the outperformer up +0.70%.
- CNY: Yuan Reference Rate at 7.1754 Per USD; Estimate 7.2581
- Bonds: liquidity injection via the OMO remained supportive of bonds with the CGB 10YR -0.07bp lower today at 1.81%
