EURJPY TECHS: Northbound
- RES 4: 148.88 High Dec 9 2014
- RES 3: 148.45 High Dec 15 2014
- RES 2: 147.76 1.236 proj of the May 12 - Jun 28 - Aug 2 price swing
- RES 1: 147.26 High Oct 18
- PRICE: 146.89 @ 06:47 BST Oct 19
- SUP 1: 144.09 High Oct 5
- SUP 2: 143.00/141.43 20-day EMA / 50-day EMA
- SUP 3: 139.44/137.40 Low Sep 29 / 26 and key support
- SUP 4: 136.02 Low Aug 25
EURJPY remains bullish and the contract extended gains into the Tuesday close, briefly topping the Y147.00 handle. The recent break of 145.64, the Sep 12 high and bull trigger, confirmed a resumption of the broader uptrend that started in May 2020. This clears the way for a climb towards 147.76 next, a Fibonacci projection. Moving average studies are in a bull mode position, highlighting a broader uptrend. Initial support lies at 144.09, the Oct 5 high.
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EUROZONE ISSUANCE: EGB Supply For W/C Sept 19, 2022
The ESM, Slovakia, Finland and Germany will all look to come to the market next week, with a potential for a Slovenian syndication (and other syndications). We look for estimated gross nominal issuance of E8.9bln from announced operations, down significantly from last week’s E47.2bln.
- The ESM has issued an RFP for a potential transaction for the upcoming week. We would expect the mandate to be announced today with the transaction tomorrow.
- Slovakia will kick off auction issuance for the week this morning with E362.6mln of 2/7/15/30-year SlovGBs on offer: E100mln of the 0% Jun-24 SlovGB (ISIN: SK4000017398), E62.6mln of the 0.75% Apr-30 SlovGB (ISIN: SK4120015173), E100mln of the 0.375% Apr-36 SlovGB (ISIN: SK4000018958) and E100mln of the 1.00% Oct-51 SlovGB (ISIN: SK4000019857).
- Belgium’s auction originally scheduled for today was cancelled in light of last week’s new Green OLO syndication.
For a full calendar of all announced EGB/EU/ESM/EFSF auctions see the MNI EZ/UK Bond Supply Calendar here.
AUD: AUD/USD Back Sub 0.6700
AUD/USD is back sub.6700, at fresh lows for the session. Whilst this is line with broader USD gains, the A$ has given back some cross gains this afternoon. We are still above Friday's lows around 0.6670 from an AUD/USD standpoint.
- Front-end yields have drifted a little lower, although some banks have shifted their RBA view to a 50bps move in October rather than 25bps post Lowe's testimony last week. This isn't priced by futures at this stage (roughly 27bps).
- Commodities have also edged away from earlier highs for iron ore and copper. Iron ore is back to $98/tonne, maintaining little of the bounce from the news that Chengdu was emerging from lockdown.
- Tomorrow's data calendar just contains RBA minutes, which may not shift sentiment too much, given it is post recent Lowe appearances.
USDJPY TECHS: Trend Needle Still Points North
- RES 4: 147.25 3.00 proj of the Aug 2 - 8 - 11 price swing
- RES 3: 146.52 1.236 proj of the May 24 - Jul 14 - Aug 2 price swing
- RES 2: 146.03 2.764 proj of the Aug 2 - 8 - 11 price swing
- RES 1: 144.99/145.28 High Sep 7 / 2.618 proj of Aug 2 - 8 - 11 swing
- PRICE: 143.29 @ 06:46 BST Sep 19
- SUP 1: 141.51 Low Sep 9
- SUP 2: 140.97 20-day EMA
- SUP 3: 139.87 Low Sep 2
- SUP 4: 138.07 50-day EMA
USDJPY is consolidating and trading closer to its recent highs. The trend signal remains bullish with key short-term resistance at 144.99, Sep 7 high. A break would confirm a resumption of the primary uptrend. This would open 145.28 and 146.03, Fibonacci projections. Initial firm support has been defined at 141.51, Sep 9 low. A strong support also lies at the 20-day EMA, at 140.97. A break of this 141.51-140.97 zone would highlight a short-term top.
