EURGBP TECHS: Trades through The 50-Day EMA

The EFSF is likely to hold a syndication today while Austria and Germany will hold auctions. Germany, Spain, France and Belgium will all look to hold auctions later in the week too while Italy will hold a buyback auction tomorrow. The EU held an auction yesterday. We pencil in issuance of E34.1bln for the week, up from E31.0bln last week.

For the full MNI EGB Supply Daily with a recap of issuance this week and a look ahead to rest of the week's issuance as well as next week, click here.

• The EFSF announced a mandate for a dual-tranche 5/10-year transaction to be held in the “near future” (we expect the transaction today). On offer will be a new bond maturing 11 November 2030 (ISIN: TBC) alongside a tap of the 2.875% Jan-35 EFSF (ISIN: EU000A2SCAS8).
  • We expect this to be the last transaction of the year and to raise the remaining E4.5bln from the EFSF's 2025 funding plan – with E2.5-3.5bln of the new Nov-30 bond sold alongside E1.0-2.0bln of the 2.875% Jan-35 bond.
• Austria will look to hold an RAGB auction this morning. As expected, the on-the-run 10-year 2.95% Feb-35 RAGB (ISIN: AT0000A3HU25) will be on offer, but the auction size is smaller than we had pencilled in at E862.5mln (E750mln to be allotted). This will be another single line auction.
• Germany will come to the market this morning with E5bln of the 2.00% Dec-27 Schatz (ISIN: DE000BU22114) on offer.

• RES 4: 5804.00 Bull channel top drawn from the Aug 1 low
• RES 3: 5800.00 Round number resistance  
• RES 2: 5777.41 1.382 proj of the Aug 1 - 22 - Sep 2 price swing
• RES 1: 5742.00 High Oct 29 and the bull trigger       
• PRICE: 5633.00 @ 06:31 GMT Nov 4
• SUP 1: 5611.00 Low Oct 22   
• SUP 2: 5567.19 50-day EMA  
• SUP 3: 5549.50 Bear channel base drawn from the Aug 1 low  
• SUP 4: 5497.00 Low Oct 14       

Short-term weakness in Eurostoxx 50 futures is considered corrective. The contract has breached the 20-day EMA, signalling scope for a deeper retracement towards support at the 50-day EMA, at 5567.19. Support below the EMA lies at 5549.50, the base of a bull channel drawn from the Aug 1 low. A breach of this level and the 50-day EMA, is required to highlight a stronger reversal. Key resistance and bull trigger is 5742.00, the Oct 29 high.

Spain, Belgium, the ESM and the EU are still scheduled to sell bills this week, while Germany, the Netherlands and France have already come to the market. We expect issuance to be E27.4bln in first round operations, up from E13.9bln last week.

• This morning, Spain will look to sell a combined E4.5-5.5bln of the 6-month May 8, 2026 letras and the new 12-month Nov 6, 2026 letras
• Also this morning, Belgium will look to issue a combined E2.0-2.4bln of TCs: An indicative E800mln of the Feb 12, 2026 TC, an indicative E800mln of the May 14, 2026 TC and an indicative E800mln of the Oct 15, 2026 TC.
• Finally today, the ESM will look to come to the market with up to E1.1bln of the new 3-month Feb 5, 2026 bills.
• To conclude issuance for the week tomorrow, the EU will look to sell up to E1.0bln of the 3-month Feb 6, 2026 EU-bill, up to E1.0bln of the 6-month May 8, 2026 EU-bill and up to E1.5bln of the new 12-month Nov 6, 2026 EU-bill.