EGBS: Retrace In German 5s30s Suggests Underlying Steepening Theme Intact

• 0RH6 98.00^ bought in 4k vs 0RH6 96.68/98.18^^ sold in 6k.

Paid 13.25 and 13.5 for the Straddle.

• The first session of the week provides some consolidation following Friday's volatility. The US dollar advanced against most others in G10 and SEK outperforms again, while the Euro and the likes of NZD and AUD weaken amid headline drivers remaining light.
• Amid reports on a fiscal easing package, price action in USDJPY points towards a renewed challenge to the 155.00 handle. The pair saw three highs around there recently ahead of Friday's temporary dip. Renewed upside would put sights on 155.53, a Fibonacci projection. Initial support to watch is 153.30, the 20-day EMA. Remember that Japanese authorities have recently stepped up their rhetoric on JPY valuations but stopped short of phrases historically associated with intervention for now.
• The extension of downward momentum in EURSEK is helping narrow the gap to an important support zone around 10.9000. A clear break of this level would expose 10.8000, which aligns closely with the April 4 low (10.7941). The case for continued SEK outperformance is largely tied to the growth differential channel. Recent domestic data have supported these arguments, with Swedish activity being supported by stimulative monetary policy, incoming fiscal stimulus and lower trade policy uncertainty.
• EURCHF closed last week at 0.9227, above a mid-term resistance zone after piercing 0.9200 for the first time since the withdrawal of the 1.20 floor in 2015. With today's price action lacking impetus following the weaker-than-expected Q3 Swiss flash GDP print, a few short-term signals suggest there may be scope for a bounce near-term for the cross.
• The trend is in oversold territory, and Friday's price pattern is a hammer candle - a potential short-term reversal signal. If the cross does recover, scope would be for a climb towards 0.9275, the 20-day EMA and 0.9298, the 50-day EMA. Key support lies at 0.9180, Friday's low and the bear trigger.
• Canada CPI, US empire manufacturing and construction spending highlight the data calendar for today alongside a set of Fed, ECB and BoE speakers.

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