EURGBP TECHS: Pierces Key Support

Spain, Finland, Portugal and the EU are yet to issue bills this week, after Germany and France issued on Monday. We look for issuance of E16.0bln at first round operations, down from E29.0bln last week.

• On Tuesday, Spain will reopen a combined E1.5-2.5bln of the 3-month May 12, 2023 and 9-month Nov 10, 2023 letras.
• Finland will then come to the market with E1bln of the 6-month Aug 14, 2023 RFTB and E1bln of the 9-month Nov 13, 2023 RFTB on offer.
• Portugal will look to sell E0.75-1.00bln of BTs on Wednesday. On offer will be the 3-month May 19, 2023 BT and the 11-month Jan 19, 2024 BT.
• Then the EU will reopen E1bln of the 3-month May 5, 2023 EU-bill and E1bln of the 6-month Aug 4, 2023 EU-bill, concluding eurozone bill issuance for the week.

For more on future auctions see the full MNI Eurozone/UK T-bill auction calendar.

• RES 4: 121.26 0.764 proj of the Dec 30 - Jan 19 - 30 price swing
• RES 3: 120.00 Psychological round number
• RES 2: 118.56/96 High Jan 19 / Dec 7 and a key resistance zone
• RES 1: 116.33/118.18 High Feb 9 / High Feb 2
• PRICE: 115.32 @ 15:29 GMT Feb 13
• SUP 1: 114.22/113.47 Low Feb 8 / Low Jan 30 and key support
• SUP 2: 112.26 61.8% retracement of the Dec 30 - Jan 19 rally
• SUP 3: 111.59 Low Jan 6
• SUP 4: 110.77 Low Jan 4 and 76.4% of the Dec 30 - Jan 19 rally

BTP futures traded sharply higher on Feb 2 and the contract breached resistance at 116.94, the Jan 25 high. The contract has pulled back from its recent highs, however, the move lower is considered corrective - for now. Key short-term support to watch lies at 113.47, the Jan 30 low. A break would be a bearish development. A reversal higher would signal scope for a test of firm resistance at 118.56, the Jan 19 high and 118.96, the Dec 7 high.