OUTLOOK: Price Signal Summary -Bear Cycle In Gilts Still In Play
Aug-22 11:10
- In the FI space, Bund futures remain above their recent lows. A bear threat is present. The contract recently breached support at 128.84, the Jul 25 low and a bear trigger. Note that the 129.00 handle marks the base of a broad range and a clear range breakout would strengthen a bearish threat. This would open 128.40 initially, the Apr 9 low. Strength above the 50-day EMA of 129.84, is required to signal a reversal. Resistance at the 20-day EMA is at 129.52.
- Gilt futures traded sharply lower on Aug 15 and this week’s extension reinforces the current bearish theme. The contract has breached key support and a bear trigger at 91.08, the Jul 18 low. This signals scope for an extension towards 90.11, the May 22 low. Resistance to watch is seen at 91.86, the 50-day EMA. Clearance of this average is required to highlight a potential reversal. First resistance is 91.22, the Aug 21 high.
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SOFR OPTIONS: BLOCK: Aug'25 SOFR Puts
Jul-23 11:06
- 50,000 SFRQ5 95.62 puts, cab (0.25) at 0652-0656ET (open interest at 39,810 coming into the session).
EU: EU Plans 30% Tariffs On E100bn Of Goods To US If No US Deal - Bloomberg
Jul-23 11:02
- Bloomberg reports that "The European Union plans to quickly hit the US with 30% tariffs on some €100 billion ($117 billion) worth of goods in the event of no deal and if US President Donald Trump carries through with his threat to impose that rate on most of the bloc’s exports after Aug. 1.
- As a part of a first wave of countermeasures, the EU would combine an already approved list of tariffs on €21 billion of US goods and a previously proposed list on an additional €72 billion of American products into one package, an European Commission spokesman said on Wednesday."
- The broad piece chimes with our policy team exclusive from last week (see "MNI: Support Grows For Retaliation Against US - EU Officials" - Jul 17).
- However, the following would be a notable firming in Germany stance. "Berlin would be willing to even support the activation of the EU’s anti-coercion instrument, or ACI, in a no-deal scenario, a government official said on condition of anonymity. This tool would come into play only if a deal fails to materialize."
- From our policy piece last week: "There is also the prospect of enacting the EU’s Anti-Coercion Instrument, which would apply charges to a wide range of U.S. services, though concerns over whether this would do excessive harm to Europe’s economy mean there is widespread reluctance to see it deployed."
MNI: US MBA: MARKET COMPOSITE +0.8% SA THRU JUL 18 WK
Jul-23 11:00
- MNI: US MBA: MARKET COMPOSITE +0.8% SA THRU JUL 18 WK
