LATAM FX: Price Signal Summary – USDCLP Bear Cycle Extends
Feb-14 14:21
- USDMXN continues to trade below the Feb 3 high. The trend structure remains bullish and the recent move above 20.9382, the Jan 17 high, marked a resumption of the uptrend. Moving average studies are in a bull-mode position, highlighting a dominant uptrend. A resumption of gains would refocus attention on 21.4007 and 21.5807, the 3.00 and 3.236 projections of the Sep 18 - Oct 1 - 4 ‘24 price swing. The pair is trading lower today. Key support has been defined at 20.1343, the Jan 24 low. A clear break of this level would highlight a potential reversal. This would open 19.7618, the Nov 7 ‘24 low.
- A bear cycle in USDBRL remains in play and this signals scope for a continued retracement. The 50-day EMA has been breached and this has been followed by a break of 5.8675, the Dec 12 low. Sights are on 5.6340, the Nov 7 low. On the upside, a reversal would refocus attention on 6.3165, the Dec 18 high and the bull trigger. Initial resistance is at 5.9104, the 50-day EMA.
- USDCLP remains in a bear-mode condition and the pair has traded lower this week. The pair has recently breached the 50-day EMA. The subsequent bear extension highlights potential for a deeper retracement. Note too that price has also traded through 966.86, the Dec 6 low, and the 960.00 handle. This opens 921.59, the 76.4% retracement of the upleg between Sep 27 ‘24 - Jan 3. Initial firm resistance is seen at 979.88, the 50-day EMA.
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US TSY OPTIONS: More 10Y Call Buying
Jan-15 14:19
Call buying continues as underlying continues to extend post-data rally (TYH5 108-06.5 +27). First projected rate cut back to July now with June nearly there.
- 13,000 TYH5 109 calls, 32 ref 108-05, total volume over 23,000
- over 9,700 TYH5 110 calls, 16 last ref 108-04.5
- 11,000 TYG5 106/107 put spds 4 ref 108-03.5
STIR: 95bps of ECB Cuts Priced Through Year-end Post US CPI
Jan-15 14:18
ECB-dated OIS are up to 5bps more dovish through the blues following the softer-than-expected US CPI report, with 96bps of cuts now priced through year-end.
- 25bp cuts remain essentially fully priced for the January and March meetings, with 15bps of sequential easing priced through into April and March respectively.
- Euribor futures are +3.0 to +12.0 ticks through the blues, with the greens leading.
- ERZ5 has retraced all of this week’s sell-off, currently +7.5 ticks at 97.90.
- The MNI Policy Team’s latest sources piece assesses the inflationary risks stemming from recent gas price increases.
- Tomorrow’s regional data calendar includes final December CPI from Germany and Italy and Eurozone trade balance data for November. The accounts of the ECB’s December meeting are also due.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Jan-25 | 2.672 | -24.7 |
| Mar-25 | 2.432 | -48.8 |
| Apr-25 | 2.282 | -63.7 |
| Jun-25 | 2.136 | -78.3 |
| Jul-25 | 2.086 | -83.3 |
| Sep-25 | 2.014 | -90.6 |
| Oct-25 | 1.994 | -92.5 |
| Dec-25 | 1.963 | -95.6 |
| Source: MNI/Bloomberg. | ||
EQUITIES: Emini sees its biggest single move since December
Jan-15 14:13
- The US Emini (ESH5) is seeing is single biggest since the last Core PCE on the 20th December and the last FOMC from the 18th December.
- The contract has fully cleared pre NFP levels, and now sees the next upside resistance at 5987.43 50-day EMA and a pivot resistance.
- There'll be some decent focus on the Cash open in just over 15 minutes, and look out for potential Program orders.
