GBPUSD TECHS: Tops 50-day EMA on Hawkish BoE
- RES 4: 1.3681 High Jul 4
- RES 3: 1.3620 High Jul 10
- RES 2: 1.3589 High Jul 24
- RES 1: 1.3453 Low Aug 8
- PRICE: 1.3434 @ 14:39 BST Aug 8
- SUP 1: 1.3144 38.2% retracement of the Jan 13 - Jul 1 bull cycle
- SUP 2: 1.3041 Low Apr 14
- SUP 3: 1.3000 Round number support
- SUP 4: 1.2945 50.0% retracement of the Jan 13 - Jul 1 bull cycle
Prices rallied again Friday, building on the gains posted after the break of the 50-day EMA on the hawkish turnout to the August BoE rate decision. This firms the speed of the recovery off the 1.3142 pullback low and signals a greater probability of a bullish reversal. For now, S/T momentum is still pointed higher, with the Jul 24 high of 1.3589 the next notable upside level. While the bounce off the pullback low persists, the more medium-term trend remains bearish - but the risk of a return to recent lows has fallen.
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GBPUSD TECHS: Correction Extends
- RES 4: 1.3852 1.764 proj of the Feb 28 - Apr 3 - 7 price swing
- RES 3: 1.3835 High Oct 20 2021
- RES 2: 1.3800 Round number resistance
- RES 1: 1.3681/3789 High Jul 04 / 01 and the bull trigger
- PRICE: 1.3582 @ 16:18 BST Jul 9
- SUP 1: 1.3526 Low Jul 08
- SUP 2: 1.3473 50-day EMA
- SUP 3: 1.3389 Trendline support drawn from the Jan 13 low
- SUP 4: 1.3245 Low May 19
The trend set-up in GBPUSD remains bullish and recent weakness appears corrective. The pair has cleared support around the 20-day EMA, signalling scope for a deeper retracement towards the next key support at the 50-day EMA. at 1.3473. Key resistance and the bull trigger is at 1.3789, the Jul 1 high. Clearance of this hurdle would resume the uptrend. Note that MA studies are in a bull-mode position, suggesting the M/T uptrend is intact.
PIPELINE: Corporate Bond Update: $11.25B NTT Finance 7-Pt Launched
NTT Finance 7-tranche debt issuance is the largest issuer since Mars issued $26B over 8 tranches on March 5.
- Date $MM Issuer (Priced *, Launch #)
- 07/09 $11.25B #NTT Finance Corp: $1.25B 2Y +72, $1.5B 3Y +82, $500M 3Y SOFR+108, $2.5B 5Y +97, $500M 5Y SOFR+131, $2.5B 7Y +107, $2.5B 10Y +117
- 07/09 $3.75B #Romania $2B +5Y +185, $1.75B +10Y +230 (also E1.5B 2039 Tap +415)
- 07/09 $1.6B #Viper Energy $500M 5Y +100, $1.1B 10Y +140
- 07/09 $900M #Gulfstream Natural Gas System 10Y +125
- 07/09 $Benchmark Western-Southern 3Y +70
- Expected Thursday:
- 07/09 $500M World Bank 2030 Tap SOFR+43a
- 07/10 $2.25B Nissan Motor $750M Each: 5Y 7.25%a, 7Y 7.75%a, 10Y 8%a
US TSYS/SUPPLY: Review 10Y Auction: Small Stop
- Treasury futures holding near session highs (TYU5 +11 at 111-04, 4.3616% yld) after the $39B 10Y note auction re-open (91282CNC1) stops .3bp through: drawing 4.362% high yield vs. 4.365% WI; 2.61x bid-to-cover vs. 2.52x prior.
- Peripheral stats: indirect take-up retreats to 65.42% vs. 70.56% prior; direct bidder take-up at 23.70% from 20.48% prior; primary dealer take-up 10.87% vs. 8.96% prior.
- The next 10Y auction (re-open) is tentatively scheduled for August 6.
