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The uptrend in EURJPY remains intact and recent weakness appears to be a correction. The move on Mar 20, through 164.30, the Nov 16 ‘23 high and a medium-term bull trigger confirms a resumption of the long-term uptrend. The break higher opens the 166.00 handle and 166.32, the top of a MA envelope. Initial firm support lies at 162.84, the 20-day EMA. Trendline support, drawn from the Dec 7 ‘23 low, lies at 161.61.
Austria, Italy and Greece are due to sell bills this week, whilst Germany and France have already come to the market this week. We expect issuance to be E22.6bln in first round operations, up from E18.2bln last week.
Despite yesterday’s pullback, Gilt futures remain closer to their recent highs. A continuation higher would expose key short-term resistance at 100.37, the Mar 13 low, where a break would strengthen any developing bullish theme. Key short-term support has been defined at 98.05, the Mar 15 low. A break would be bearish. For now, 98.05 and 100.37 mark the key short-term directional triggers.