EURGBP edged lower Tuesday, breaking out of the recent tight range. The move lower extends the pullback from the 0.8829 high on Nov 9. A continuation lower would expose the Oct 31 low of 0.8560, where a break would resume bearish activity. Moving average studies remain in a bull mode position and this suggests that the broader uptrend is intact. A break of 0.8829 would be bullish.
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USDCAD traded briefly below the 20-day EMA Thursday. This average, at 13670, is an important S/T support. The uptrend remains intact and the latest pullback is considered corrective. The recovery from 1.3503, Oct 10 high, reinforces bullish conditions. MA studies still highlight an uptrend and 1.3838, Sep 30 high has been cleared. Should markets close below the 20-day EMA, a deeper correction toward 1.3503, Oct 4 low, would be on the cards.
Tsys trade mixed after the close, yield curves broadly steeper as 2s through 10s finished broadly higher vs. continued weakness in long end 30Y bonds Friday.
Just minutes after yield hit new cycle highs (10YY 4.3354%) - yields reversed course (10YY 4.2188%) as short end surged following tweet from WSJ's Nick Timiaros:
Investment-grade corporate credit risk cooled Friday, back near October lows amid a cautious bounce in stocks as more hawkish (read: 75bp) year end rate hikes debated.