USDCAD TECHS: Monitoring Resistance
- RES 4: 1.3929 High Jan 16 and a reversal trigger
- RES 3: 1.3845 High Jan 22
- RES 2: 1.3800 High Jan 23
- RES 1: 1.3722/25 50-day EMA / High Feb 6 / 24 and a key resistance
- PRICE: 1.3669 @ 08:07 GMT Feb 27
- SUP 1: 1.3594/3482 Low Feb 13 / Low Jan 30 and the bear trigger
- SUP 2: 1.3420 Low Sep 25 ‘24
- SUP 3: 1.3400 50.0% retracement of the 2021 - 2025 uptrend
Key short-term resistance to watch in USDCAD remains 1.3725, the Feb 2 high. A clear breach of this hurdle would highlight a potential reversal and suggest scope for a stronger short-term bull phase. For now, the medium-term trend structure remains bearish - moving average studies continue to highlight a dominant downtrend. A reversal lower would refocus attention on key support and the bear trigger at 1.3482, the Jan 30 low.
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GOLD TECHS: Continues To Appreciate
- RES 4: $5508.6 - 1.764 proj of the Nov 18 - Dec 26 - Dec 31 swing
- RES 3: $5400.0 - Round number resistance
- RES 2: $5378.3 - 2.000 proj of the Nov 18 - Dec 26 - Dec 31 swing
- RES 1: $5300.0 - Round number resistance
- PRICE: $5295.3 @ 08:03 GMT Jan 28
- SUP 1: $4990.7 - Low Jan 26
- SUP 2: $4708.9 - 20-day EMA
- SUP 3: $4536.9 - Low Jan 16
- SUP 4: $4460.6 - 50-day EMA
The primary uptrend in Gold remains intact and another fresh cycle high reinforces the bull phase. This also maintains the price sequence of higher highs and higher lows. The psychological $5000.0 level has been cleared this week. Sights are on $5378.3 next, a Fibonacci projection. Initial firm support lies at $4708.9, the 20-day EMA. The trend is overbought, a pullback would allow this condition to unwind. First support is at $4990.7, the Jan 23 low.
STIR: EUR Markets Latch Onto Dovish Kocher Excerpt
Dovish repricing in EUR STIRs this morning after Austrian National Bank Governor Kocher suggested to the FT that continued EUR appreciation could create “a certain necessity to react in terms of monetary policy”. Note that in the same interview, Kocher stressed that recent EURUSD appreciation has been “modest” and does not necessitate a response for now. Markets are nonetheless reacting to the shift in the implied distribution of ECB policy rates.
- ECB-dated OIS now price 7bps of easing through September, up from 2bps at yesterday’s close. Friday’s heavy data schedule (Q4 flash GDP, Spain/Germany flash inflation) may be key in determining whether this repricing lasts.
- In an interview with El Pais this morning, Executive Board member Cipollone highlighted that “GDP has been resilient and we’re expecting figures that may even outperform the forecasts. And inflation has been hovering around our target in recent months. We are undoubtedly in a good place.”
- Euribor futures are +1.0 to +3.0 ticks through the blues, with the back of the white and red pack leading. Last Wednesday’s highs are the initial topside targets in ERZ6 and ERH7.
- We explored whether EURUSD’s push towards 1.20 was “complicated” for the ECB yesterday
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Feb-26 | 1.932 | -0.2 |
| Mar-26 | 1.923 | -1.1 |
| Apr-26 | 1.910 | -2.4 |
| Jun-26 | 1.885 | -4.9 |
| Jul-26 | 1.876 | -5.8 |
| Sep-26 | 1.864 | -7.0 |
| Oct-26 | 1.870 | -6.4 |
| Dec-26 | 1.882 | -5.2 |
| Jan-27 | 1.906 | -2.8 |
| Source: MNI/Bloomberg Finance L.P. | ||
GILTS: Opening Calls
Gilt calls are wider given the outperformance in Bund futures vs US.
Range 90.89/91.16, would give an ~91.03 mid.
