US 10YR FUTURE TECHS: (M6) Narrows Gap with Bear Trigger
May-01 11:20
* RES 4: 112-16 61.8% retracement of the Mar 2 - 27 bear leg * RES 3: 112-07 High Mar 18 * RES 2: 11...
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US DATA: Mortgage Applications Slip Again As Higher Rates Continue To Bite
Apr-01 11:14
- MBA composite mortgage applications saw a third consecutive weekly decline of 10-11% last week in seasonally adjusted terms, with -10.4%.
- Refis are leading this weakness in an environment of sizeable increases in mortgage rates in spillover from the US-Israel-Iran conflict, sliding another -17.3% after -14.6%, although new purchase applications also fell -2.6% after -5.4%.
- Indeed, composite applications are at their lowest since the week at the turn of the year although new purchase applications (a better gauge for upcoming housing market activity) are only back to levels seen in late Feb shortly before the first US-Israel strikes on Iran.
- The 30Y conforming rate increased 14bp to 6.57% for a 48bp increase since the 6.09% in late Feb at what was its lowest since Sep 2022.
- Market-based rates do at least offer some grounds for optimism with a latest 10Y Tsy yield 9bp below last week’s average and the 10Y swap rate 7bp below.
- Spreads continued to widen last week, with the spread to 10y Tsy yields increasing to 220bp (+2.7bp) having bottomed in the high 190s in mid-Jan to early Feb. Alternatively, the spread to 10Y swaps rates widen to 266bps (+2.7bp) having bottomed in the 230s in mid-Jan to early Feb.
OUTLOOK: Price Signal Summary - Gains In Gold Appear Corrective For Now
Apr-01 11:11
- On the commodity front, a corrective cycle in Gold is in play. Key near-term resistance is at $4801.1, the 50-day EMA. A clear break of this average is required to signal scope for a stronger recovery. This would open $4914.9, 61.8% retracement of the Mar 2 - 23 bear leg. For bears, a reversal would mark the end of the correction and signal scope for a move towards the bear trigger at $4099.2, the Mar 23 low.
- A bull wave in WTI futures remains intact and the sharp pullback on Mar 23 proved to be a correction. A fresh short-term cycle high yesterday reinforces the bull theme. A key support zone to monitor is the area between $90.76 - $79.50, the 20- and 50-day EMA values. Sights are on $113.41, the Mar 9 high and bull trigger.
OUTLOOK: Price Signal Summary - Bullish Engulfing Candle In EURUSD
Apr-01 11:00
- In FX, the trend condition in EURUSD is bearish, highlighted by MA studies that remain in a bear-mode position. For now, gains are considered corrective. However, yesterday’s price pattern is a bullish engulfing candle - a short-term reversal signal. If correct, it suggests potential for a stronger bounce. Resistance to watch is 1.1648, the 50-day EMA. Key support and the bear trigger lies at 1.1411, the Mar 13 and 16 low.
- The trend condition in GBPUSD is unchanged, it remains bearish. MA studies are in a bear mode position highlighting a dominant downtrend. This week’s breach of 1.3219, the Mar 13 low, strengthens a bear theme and confirms a resumption of the downtrend. Sights are on 1.3125, the Nov 26 ‘25 low. A key resistance to watch is at the 50-day EMA, at 1.3415. A clear break of it is required to undermine the bearish theme. First resistance is 1.3348, the 20-day EMA.
- The trend needle in USDJPY points north and short-term pullbacks are considered corrective. The breach of the 160.00 handle strengthens the bullish condition. Note too that moving average studies are in a bull-mode position, highlighting a dominant medium-term uptrend. Sights are on 160.79 next, a 1.500 projection of the Jan 27 - Feb - 12 price swing. Initial firm support to watch is 157.42, the 50-day EMA. A clear break of it would highlight a potential short-term reversal threat.
