US EURODLR FUTURES: Post-LIBOR Settle Update, Another New 3M High
Lead quarterly EDH2 currently trading +0.005 at 99.1725, fast two-way trade again after latest 3M LIBOR settlement continues to surge to highest level since late April 2020: +0.04200 to 0.74500% (+0.13486/wk).
- Levels out the strip trading weaker, at near overnight lows: balance of Whites (EDM2-EDZ2) -0.010-0.035, Reds through Golds (EDH3-EDZ6) -0.055-0.040.
- Policy uncertainty during Russia/Ukraine war as expressed by inversion in futures has crept into the Reds with with EDM3 and EDU3 both at 97.68 vs. EDZ3 at 97.72. Greens (EDH4-EDZ4) ascending from 97.83 to 97.945 while Blues (EDH5-EDZ5) trade narrow range from 97.985 to 98.01.
- Option positioning continues to target downside puts, outright or spd with one acct rolling down strikes with over 100,000 Dec 97.00/97.50/98.00 put trees sold from -0.010-0.005 since last Friday.
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EQUITIES: Q1 Earnings Well Ahead of Expectations
- The average firm in the S&P 500 continues to beat forecast on EPS by 7.8%,while beating revenue expectations by 3.0%. Communication services, financials and real estate are the strongest performing sectors vs. forecast, while materials, energy and utilities sectors have performed most poorly
- Full earnings schedule with timings, EPS & revenue expectations here: https://marketnews.com/mni-us-earnings-schedule-qu...
US 10YR FUTURE TECHS: (H2) Resumes It Downtrend
- RES 4: 129.14 High Jan 5
- RES 3: 129-00 50-day EMA
- RES 2: 128-04/22+ 20-day EMA / High Jan 24
- RES 1: 127-24 High Feb 4
- PRICE: 126-26 @ 12:04 GMT Feb 7
- SUP 1: 126-22+ Intraday low
- SUP 2: 126-17/16 1.0% 10-dma Env / 1.236 of Jan 13-19-24 swing
- SUP 3: 126-10+ 61.8% retracement of the 2018 - 2020 bull cycle
- SUP 4: 126-01 1.50 proj of the Jan 13 - 19 - 24 price swing
Treasuries extended lower Friday. The sell-off resulted in a break of support at 127-02, the Jan 19 low and bear trigger. Furthermore, the move lower has confirmed a resumption of the downtrend and cleared the base of a recent triangle or pennant formation. With moving average studies also pointing south, attention is on weakness towards 126-16 next, a Fibonacci projection and 126-10+, a retracement level. Initial resistance is at 127-24.
EUROZONE ISSUANCE: Mandate: New EFSM short 5y / NGEU 30-year tap
"The EU has mandated Citi, J.P. Morgan, Nordea, Societe Generale and UniCredit as Joint Lead Managers for its new EUR Fixed Rate RegS Bearer dual tranche transaction, comprising:
- A new EFSM EUR 2.2bn no-grow short 5yr (Oct-2026)
- NGEU #6 a tap of EU 0.7% 07/2051.
- No further group. The transaction will be launched tomorrow, subject to market conditions."
