EURJPY TECHS: Pierces Bull Channel Support

• -10,000 FVH6 108-23.75, sell through 108-24 post time bid at 1422:34ET, DV01 $428,100.
• The 5Y contract trades 108-24.75 last (+.5).

European yields rose modestly Tuesday.

• Bonds started on the back foot following overnight weakness in US Treasuries and a hawkish rate hike by the RBA.
• A softer-than-expected French flash January inflation helped EGBs consolidate briefly, while the ECB's Q4 BLS indicated a relatively muted credit-led growth impulse.
• Supply was a theme all day on both sides of the Atlantic, with multiple European sales (UK/ESM/Italy/German Green) and US corporate supply weighing in the early afternoon.
• Bunds underperformed Gilts which benefited from a solid 4.75% Oct-35 auction amid only limited UK-centric headlines, with most focus remaining on this week's BOE meeting.
• OATs modestly outperformed in the EGB space, following the passage of the 2026 French budget after the cash close Monday.
• Wednesday brings Italy/Eurozone flash January inflation data, with final PMIs. Attention remains on Thursday's ECB and BOE decisions. MNI's ECB meeting preview went out today - PDF here.

Closing Yields / 10-Yr EGB Spreads To Germany

• Germany: The 2-Yr yield is up 0.9bps at 2.123%, 5-Yr is up 1.5bps at 2.463%, 10-Yr is up 2.3bps at 2.891%, and 30-Yr is up 3.4bps at 3.55%.
• UK: The 2-Yr yield is up 0.5bps at 3.708%, 5-Yr is up 1.7bps at 3.953%, 10-Yr is up 1.1bps at 4.517%, and 30-Yr is up 1.5bps at 5.288%.
• Italian BTP spread down 0.7bps at 60.7bps / French OAT down 1bps at 57.6bps

• RES 4: 159.45 High Jan 14 and the bull trigger 
• RES 3: 159.23 High Jan 23
• RES 2: 157.43 Low Jan 19  
• RES 1: 155.75/156.08 50-day EMA / High Feb 03
• PRICE: 155.70 @ 16:21 GMT Feb 3  
• SUP 1: 152.10 Low Jan 27 and the bear trigger 
• SUP 2: 151.98 38.2% of the Apr 22 ‘25 - Jan 14 bull cycle 
• SUP 3: 151.54 Low Oct 29 ‘25
• SUP 4: 150.99 Trendline support drawn from the Apr 22 ‘25 low 

Short-term trend conditions in USDJPY are unchanged and a bear cycle remains intact. However, for now, a corrective cycle is in play and the latest recovery has allowed a recent oversold condition to unwind. Firm resistance to watch is at 155.75, the 50-day EMA. It has been pierced, a clear break of this average would signal a possible bullish reversal. Key short-term support has been defined at 152.10, the Jan 27 low.