EU ENERGY SECTOR: Saipem: Q3 Results Headlines   

• RES 4: 1.4019 38.2% retracement of the Feb 3 - Jun 16 bear leg 
• RES 3: 1.3925 High Aug 22 and the bull trigger
• RES 2: 1.3890 High Sep 11
• RES 1: 1.3848 High Sep 15 
• PRICE: 1.3838 @ 08:13 BST Sep 23
• SUP 1: 1.3727 Low Aug 29 and a bear trigger  
• SUP 2: 1.3709 61.8% retracement of the Jul 23 - Aug 22 bull cycle
• SUP 3: 1.3658 76.4% retracement of the Jul 23 - Aug 22 bull cycle 
• SUP 4: 1.3637 Low Jul 25  

A sharp sell-off in USDCAD early last week resulted in a break of the 20-and-50-day EMAs. This undermines a recent bullish theme and exposes key short-term support at 1.3727, the Aug 27 low. A clear break of this level would strengthen a bearish threat and signal scope for a deeper retracement. For bulls, the pair is off its recent lows. Resistance levels to watch are; 1.3890, the Sep 11 high, and 1.3925, the Aug 22 high and bull trigger.

Gilts a touch higher after Bunds & Tsys firm through early London trade.

• Ongoing weakness in crude oil helps provide support.
• Futures back towards yesterday’s high, topping out at 90.91.
• Initial support and resistance 90.60/91.11.
• Yields 1-2bp lower, curve flatter, last week’s lows in 2s10s and 5s30s remain untouched (closing lows are ~6bp away on both curves).
• UK flash PMI data is due today.
• It is also worth noting that the DMO will come to market with 30-Year gilts. Market participants will be watching the demand metrics closely after last week’s PSNB data revealed ongoing fiscal deterioration.
• On the fiscal front, the Resolution Foundation has suggested that Chancellor Reeves could raise ~GBP6bln by cutting employee national insurance contributions by 2ppt and raising the basic rate of income tax by the same amount. Note that this would only cover around 20% of the fiscal shortfall, but it would be a way of not increasing taxes on "working people" and might avoid some more painful taxes elsewhere that could hit growth harder or increase CPI.
• Elsewhere, BoE chief economist Pill will speak via a fireside chat on “Challenges of Monetary Policy in an Environment of High Fiscal and Geopolitical Uncertainty” (10:00 London).

• RES 4: 0.6793 1.500 proj of the Jun 23 - Jul 24 - Aug 21 price swing
• RES 3: 0.6763 1.382 proj of the Jun 23 - Jul 24 - Aug 21 price swing
• RES 2: 0.6726 1.236 proj of the Jun 23 - Jul 24 - Aug 21 price swing
• RES 1: 0.6660/6707 High Sep 18 / 17
• PRICE: 0.6586 @ 08:07 BST Sep 23
• SUP 1: 0.6575/6547 Low Sep 22 / 50-day EMA 
• SUP 2: 0.6527 61.8% retracement of the Aug 21 - Sep 17 bull leg  
• SUP 3: 0.6463/6415 Low Aug 27 / Low Aug 21 / 22 and a bear trigger 
• SUP 4: 0.6373 Low Jun 23

The AUDUSD uptrend remains intact and the latest pullback is considered corrective - for now. The recent rally plus the breach of 0.6625, the Jul 24 high and bull trigger, confirms a resumption of the uptrend. The climb opens the 0.6726 next, a Fibonacci projection. MA studies are in a bull-mode position highlighting a dominant uptrend. Key support to watch is 0.6415, the Aug 21 / 22 low. Initial firm support to watch is 0.6547, the 50-day EMA.