BONDS: MNI Europe Pi: As Usual OAT Stays Flat, Gilt Short, BTP Very Long (2/2)

• RES 4: 1.3789 High Jul 1 and key resistance    
• RES 3: .3661/3726 High Sep 18 / 17 
• RES 2: 1.3537 High Sep 23 1
• RES 1: 1.3427 Low Sep 24  
• PRICE: 1.3407 @ 18:45 BST Sep 26
• SUP 1: 1.3324 Low Sep 25
• SUP 2: 1.3282 Low Aug 6
• SUP 3: 1.3254 Low Aug 4
• SUP 4: 1.3144 38.2% retracement of the Jan 13 - Jul 1 bull cycle          

GBPUSD traded lower last Thursday, marking an extension of the current bear cycle that started Sep 17. The move down has resulted in a break of 1.3491, a trendline support drawn from the Aug 1 low. This undermines a recent bullish theme. Note too that 1.3333, the Sep 3 low and a key support, has been pierced, opening 1.3282 next, the Aug 6 low. Initial resistance to watch is 1.3537, the Sep 23 high. A break of it would signal a reversal.

• RES 4: 1.2063 2.236 proj of the Feb 28 - Mar 18 - 247 price swing
• RES 3: 1.2000 Round number resistance 
• RES 2: 1.1919/23 High Sep 17 / 2.0 proj of Feb 28 - Mar 18-27 swing
• RES 1: 1.1735/1820 20-day EMA / High Sep 23  
• PRICE: 1.1701 @ 18:39 BST Sep 26
• SUP 1: 1.1646 Low Sep 25 
• SUP 2: 1.1574 Low Aug 27
• SUP 3: 1.1528 Low Aug 5
• SUP 4: 1.1392 Low Aug 1 and bear trigger.

The trend theme in EURUSD is unchanged, it remains bullish and the recent pullback appears corrective. However, support at 1.1680. the 50-day EMA, has been breached. A clear break of this average would signal scope for a deeper retracement and expose 1.1574 initially, the Aug 27 low. For bulls, a resumption of gains would refocus attention on 1.1923, a Fibonacci projection. Initial firm resistance to watch is 1.1820, the Sep 23 high. 

While we heard the monetary policy views of 6 of 12 current FOMC voters this week, there were no real surprises. We go through all of the relevant FOMC communications in full in our Macro Weekly PDF.

• Chair Powell reiterated that policy is not on a preset course; Gov Bowman and Gov Miran reiterated their more-dovish-than-median views; Musalem and Schmid suggested only limited scope for easing; and Goolsbee eyed neutral rates 100-125bp lower but was “uneasy” with too much front-loading.
• Virtually of the week’s FOMC speakers noted labor market risks had begun to surface, but had varying concerns about inflation. To sum up:

2025 FOMC Voters:

• Powell Reiterates "There Is No Risk-Free Path", Policy Not On Preset Course (Sep 23)
• Gov Bowman: Concerned Will Need Faster And Bigger Cuts (Sep 23)
• St Louis's Musalem: Limited Room For Easing, Policy May Be Close To Neutral (Sep 22)
• Chicago's Goolsbee Eyes Neutral Rates 100-125bp Lower (Sep 23), Uneasy With Too Much Cut Frontloading (Sep 25)
• Gov Miran: Appropriate Rates In 2.00-2.50% "Ballpark" (Sep 22)
• KC Fed's Schmid: Slightly Restrictive Policy The "Right Place To Be" (Sep 24)

Non-2025 Voters:

• Atlanta's Bostic Pencils In No More Cuts this Year, But Watching Data (Sep 22), Longer-Run Dot Suggests Limited Impetus To Cut Further (Sep 23)
• SF's Daly: Likely Further Cuts Will Be Needed To Support Labor Market (Sep 24)
• Cleveland's Hammack: Policy Very Mildly Restrictive, Concerns On More Cuts (Sep 22)
• Dallas's Logan: Time To Move From Fed Funds Policy Rate To Tri-Party Repo (Sep 25)
• Barkin: Jobs Shakier, Inflation Less Troubling (Sep 26)