GBPUSD TECHS: Support Remains Intact

• RES 4: 1.3368 50.0% retracement of the Sep 17 - Nov 4 bear leg    
• RES 3: 1.3303 50-day EMA   
• RES 2: 1.3284 38.2% retracement of the Sep 17 - Nov 4 bear leg 
• RES 1: 1.3203/16 20-day EMA / High Nov 13
• PRICE: 1.3142 @ 16:36 GMT Nov 18
• SUP 1: 1.3085/10 Low Nov 12 / Low Nov 4 & 5 and the bear trigger 
• SUP 2: 1.2971 1.382 proj of the Sep 17 - 25 - Oct 1 price swing
• SUP 3: 1.2945 50.0% retracement of the Jan 13 - Jul 1 bull leg
• SUP 4: 1.2877 1.618 proj of the Sep 17 - 25 - Oct 1 price swing          

A key short-term resistance in GBPUSD at 1.3203, the 20-day EMA, remains intact. It has been pierced, a clear break of it would signal scope for a stronger corrective cycle and expose the 50-day EMA, at 1.3303. Moving average studies remain in a bear-mode condition and continue to highlight a dominant downtrend. A reversal would signal the end of the correction and a resumption of the bear leg. The bear trigger is 1.3010, the Nov 4 and 5 low.                   

• The Canadian dollar is notably outperforming today, allowing USDCAD to gather downside momentum below the 1.40 mark and last week’s lows at 1.3985. Spot is now testing the 50-day EMA, of which the pair has not closed below since September.
• Price action bolsters the short-term bearish outlook, as the pair continues to trade inside a bull channel drawn from the Jul 23 low. The respect of the channel top on Nov 11, and the subsequent move south highlights scope for a bear extension towards the base of the channel at 1.3893.
• It’s worth highlighting that both CADJPY and CADCHF have risen the best part of 1% on the session, bolstered by the fact that further BOC rate cuts are pretty much out of the question after October data. CADJPY has significantly narrowed the gap to the November 2023 highs at 111.56.
• Moves have been bolstered by PM Mark Carney securing passage of the first federal budget of his tenure. It is worth noting that this was by a two-vote margin, and only thanks to the backing/abstention of opposition MPs, however, it does ensure the survival of his minority government, given that federal budget votes are deemed confidence motions.
• Canada’s data calendar is relatively light this week, with September retail sales due on Friday.

Historical context for Pfizer issuance: the multinational pharmaceutical and biotechnology corporation is the eighth largest issuer on record with $31B over 8 tranches on May 16, 2023: $3B 2Y +60, $3B 3Y +75, $4B 5Y +95, $3B 7Y +115, $5B 10Y +125, $3B 20Y +130, $6B 30Y +145, $4B 40Y +160. Rate locks from hedgers and speculative accts certainly weighing on Treasuries today.

• Date $MM Issuer (Priced *, Launch #)
• 11/18 $Benchmark Pfizer 7pt jumbo: 2Y +30, 2Y SOFR, 5Y +52, 7Y +65, 10Y +75, 30Y +87.5, 40Y +100.
• 11/18 $2.5B Genmab 7NC3 6.375%a, 8NC3 7.375%a
• 11/18 $750M #Vale Overseas +30NC5 6.125%
• 11/18 $600M Eurofima Jan 2029 SOFR+36
• 11/18 $600M #Buenos Aires 7Y 8.125%
• 11/18 $500M #Global Atlantic Fin 30NC5 7.25%
• 11/18 $Benchmark Sharjah 10.5Y Sukuk +145a
• 11/18 $Benchmark RGA Global Funding 5Y +93a
• 11/18 $Benchmark Pricoa Global Funding 5Y +68
• 11/18 $Benchmark Steel Dynamics 3Y +63, 10Y +93
• 11/18 $Benchmark Cenovius +5Y +100a, +10Y +130a
• 11/18 $Benchmark Protective Life Corp +5Y +105, 10Y +125
• 11/18 $Benchmark Protective Life Corp +5Y +105a, 10Y +125a
• 11/18 $Benchmark Spire 30.5NC5.25 6.25%, 30.5NC10.25 6.45%a
• 11/18 $Benchmark Goldman Sachs Private Equity investor calls