OUTLOOK: Price Signal Summary - EUROSTOXX50 Rally Highlights A Reversal
Nov-27 10:58
- In the equity space, S&P E-Minis are holding on to their latest gains following the recovery from the Nov 21 low. The climb has resulted in a breach of the 20- and 50- day EMAs. This highlights a bullish development and the likely end of the corrective cycle between Oct 30 and Nov 21. A continuation higher would signal scope for a move towards the key resistance and bull trigger at 6953.75, the Oct 30 high. Key support lies at 6525.00, the Nov 21 low.
- The move higher in EUROSTOXX 50 futures this week, undermines a recent bearish theme. The contract has traded above the 20- and 50-day EMAs and this signals scope for a stronger recovery near-term. A continuation would open 5691.30 and 5742.40, the 61.8% and 76.4% retracement points of the Nov 13 - 21 bear leg. For bears, a reversal lower would instead expose the key short-term support and bear trigger at 5475.00, the Nov 21 low.
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OUTLOOK: Price Signal Summary - S&P E-Minis Bull Cycle Extends
Oct-28 10:54
- In the equity space, the trend condition in S&P E-Minis remains bullish and the contract traded higher Monday, as it started the week on a bullish note. The fresh cycle high confirms a resumption of the primary uptrend and maintains the bullish price sequence of higher highs and higher lows. The 6900.00 handle has been cleared, opening 6953.25 next, a 2.000 projection of the Aug 1 - 15 - 20 price swing. Initial firm support to watch lies at 6748.48, the 20-day EMA.
- The trend structure in EUROSTOXX 50 futures is bullish. Monday’s fresh cycle high reinforces a bull theme and maintains the rising price sequence of higher highs and higher lows. Note too that moving average studies are in a bull-mode position, highlighting a dominant medium-term uptrend. Sights are on 5727.18, a 1.236 projection of the Aug 1 - 22 - Sep 2 price swing. First support lies at 5625.31, the 20-day EMA.
US TSYS: Little Changed; Consumer Confidence and 7Y Supply Lead Docket
Oct-28 10:49
- Treasuries are little changed on the day, with yields between +/- 0.5bps, consolidating yesterday’s twist flattening.
- Early attention could be on geopol headlines, including with President Trump at a dinner with business leaders in Tokyo.
- We suspect today’s data focus is on the Conference Board consumer survey for October, especially the labor differential which in recent months has continued to imply a steady drift higher in the unemployment rate.
- Today also sees further note issuance with 7Y supply after yesterday’s double 2Y and 5Y auctions of which both were near in-line.
- The FOMC tomorrow, Trump-Xi Thursday and big tech earnings loom large this week.
- Fed Funds implied rates are unchanged on the day, pointing to a 25bp cut tomorrow and a cumulative 49bp to year-end, before 73.5bp for March and 93bp for June.
- TYZ5 trades at 113-16 (+02+) on modest volumes of 245k, having kept to narrow ranges of 113-14+ to 113-18+.
- It consolidates yesterday’s lift off lows of 113-04, in a move that probed support at 113-06+ (20-day EMA) and opened 112-25+ (50-day EMA). Recent weakness appears to be corrective with a bullish structure still in place, with resistance at 113-24 (post-CPI high) before 114-02 (Oct 17 high).
- Data: FHFA/S&P Cotality House Prices Aug (0900ET), Conf Board consumer survey Oct (1000ET), Richmond Fed mfg Oct (1000ET), Dallas Fed Services Oct (1030ET)
- Coupon issuance: Tsy $44B 7Y Note auction - 91282CPF2 (1300ET)
- Bill issuance: US Tsy $95B 6W & $50B 52W bill auctions (1130ET)
- Politics: Trump in Reception and Dinner with Business Leaders in Tokyo (0605ET)
GERMAN AUCTION RESULTS: Weak 2.20% Oct-30 Bobl Results
Oct-28 10:41
- Another weak German auction today of the 2.20% Oct-30 Bobl. Amount of bids remained roughly unchanged vs October 7, when the line was last issued.
- Demand metrics remained very weak despite picking up marginally vs Oct 7: The auction was technically uncovered with a 0.94 bid-to-offer. Bid-to-cover also low at 1.24x. The lowprice achieved at the auction was above the pre-auction secondary market midprice, however.
- No discernible market reaction following the results.
