BOBL TECHS: (U5) Bullish Outlook
- RES 4: 118.790 High Apr 7 and the bull trigger
- RES 3: 118.649 1.382 proj of the May 21 - Jun 3 - Jun 5 price swing
- RES 2: 118.531 1.236 proj of the May 21 - Jun 3 - Jun 5 price swing
- RES 1: 118.340 Intraday high
- PRICE: 118.320 @ 06:28 BST Jun 13
- SUP 1: 117.889/117.530 20-day EMA / Low Jun 5
- SUP 2: 117.470 Low May 21 and a key near-term support
- SUP 3: 117.470 Low May 21
SUP 4: 116.660 Low Mar 27
Bobl futures remain in a bull cycle and this week’s gains reinforce current conditions. The contract has pierced resistance at 118.280, the Jun 3 / 5 high. This signals scope for a climb towards 118.531, a Fibonacci projection. Further out, potential is seen for an extension towards 118.790, the Apr 7 high. On the downside, support to monitor is 117.530, the Jun 5 low. A break of this level would be bearish.
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EUROZONE T-BILL ISSUANCE: W/C 12 May
Germany, France, Spain, Belgium and Finland have sold bills this week. We expect issuance to have been E18.1bln in first round operations, down from E33.8bln last week.
SCHATZ TECHS: (M5) Retracement Mode
- RES 4: 107.812 0.618 proj of the Mar 6 - Apr 7 - 9 price swing
- RES 3: 107.775 High Apr 7 and the bull trigger
- RES 2: 107.600/735 High Apr 30 / 22
- RES 1: 107.237/367 50- and 20-day EMA values
- PRICE: 107.100 @ 06:03 BST May 14
- SUP 1: 107.070 Low May 13
- SUP 2: 106.965 Low Apr 9 and a key support
- SUP 3: 106.928 61.8% retracement of the Mar 6 - Apr 7 bull cycle
- SUP 4: 106.830 Low Mar 27
The trend condition in Schatz futures remains bullish, however, a sharp sell-off on Monday strengthens a short-term bearish theme and signals scope for a deeper corrective retracement. The contract has breached 107.090, 50.0% of the rally between Mar 6 - Apr 7. This exposes the next key support at 106.965, the Apr 9 low. Initial firm resistance to watch is 107.367, the 20-day EMA.
CHINA: Country Wrap: Yuan Could Strengthen Further
- There is still space for yuan to rise further against the dollar in the short term after China and the US reached a temporary truce on tariffs in Geneva, the Securities Times reports, citing analysts. The yuan is expected to remain volatile and rise in May, fluctuating between 7.0 and 7.3 against the greenback, mostly driven by continuous economic recovery in China and uncertainties of US policies, the report says, citing China Center for Economic Research at Peking University (source Securities Times)
- Goldman Sachs Group Inc. and other major banks boosted their forecasts for China’s 2025 economic growth, citing a better outlook for exports following the tariff truce with the US. Economists at Goldman Sachs, JPMorgan Chase & Co., ING Groep NV and Bloomberg Economics this week lifted their projections to 4.6% or above from as low as 4% previously. China could avoid a contraction in exports this year after striking a temporary deal with the US to de-escalate their trade conflict, Goldman said in a note Tuesday. (source BBG)
- China's Hang Seng was strong today rising +1.4% erasing most of yesterday's losses. The CSI 300 was up also but by just +0.27%, Shanghai +0.20% with Shenzhen the outlier falling -0.30%. Taiwan's TAIEX is up for a fourth straight day, up +1.76%
- Yuan Reference Rate at 7.1956 Per USD; Estimate 7.1842
- A touch weaker today with the CGB 10YR 1.67% (+1bp)
