The USDJPY trend outlook remains bullish and yesterday’s sell-off appears to have been a correction. The pair pierced support at 149.66, the 20-day EMA. A clear break of this average is required to signal potential for a deeper retracement, potentially towards the 50-day EMA, at 148.28. For bulls, a resumption of the trend would open 151.91/95, the Nov 13 ‘23 high and the Oct 1 ‘22 high and major resistance. The bull trigger is 150.89, Feb 13 high.
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The trend needle in Gilt futures continues to point south and recent gains appear - for now - to be a correction. The contract has cleared support at 99.60, the Jan 5 low. This confirmed a resumption of the downtrend that started Dec 27, signalling scope for a continuation lower towards 97.39, the Dec 11 low. Firm resistance to watch is 99.34, the 20-day EMA. It has been pierced, a clear break of the average would ease bearish pressure.
Greece is due to sell bills today, while Germany, France, and Belgium have already come to the market this week. We expect issuance to be E15.1bln in first round operations, down from E23.2bln last week.