BOBL TECHS: (U5) Support Has Been Breached
- RES 4: 118.390 High Jun 13 and a key resistance
- RES 3: 118.060 High Jun 20
- RES 2: 117.980 High Jul 4
- RES 1: 117.741 20-day EMA
- PRICE: 117.570 @ 06:04 BST Jul 10
- SUP 1: 117.360 Low Jul 8
- SUP 2: 117.210 1.000 proj of the Jun 13 - 16 - 20 price swing
- SUP 3: 117.009 1.236 proj of the Jun 13 - 16 - 20 price swing
- SUP 4: 117.000 Round number support
Bobl futures traded lower Tuesday, resulting in a breach of support at 117.530, the Jun 5 low. The breach highlights a stronger reversal and cancels a recent bull theme. Scope is seen for a move towards 117.210, a Fibonacci projection. On the upside, resistance to watch is seen at 117.741, the 20-day EMA. A clear break of this average is required to signal a possible reversal. This would refocus attention on 118.060, the Jun 20 high.
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LOOK AHEAD: Eurozone Timeline of Key Events (Times BST)
| Date | Time | Country | Event |
| 10-Jun | 0900 | IT | Industrial Production |
| 11-Jun | 1030 | EU | ECB Lane At 2025 Government Borrowers Forum |
| 11-Jun | 1300 | EU | ECB Cipollone On Digital Payments Panel |
| 12-Jun | 1000 | EU | ECB Schnabel Visits "House of the Euro" |
| 12-Jun | 1300 | EU | ECB de Guindos At Financial Integration Conference |
| 12-Jun | 1320 | EU | ECB Schnabel At Financial Integration Conference |
| 12-Jun | 1515 | EU | ECB Elderson At Senior Supervisors Conference |
| 13-Jun | 0700 | DE | HICP (f) |
| 13-Jun | 0745 | FR | HICP (f) |
| 13-Jun | 0800 | ES | HICP (f) |
| 13-Jun | 1000 | EU | Industrial Production / Trade Balance |
| 13-Jun | 1600 | EU | ECB Elderson At Senior Supervisor's Conference |
| 16-Jun | 0900 | IT | HICP (f) |
| 16-Jun | 1130 | EU | ECB Cipollone At Osservatorio Banca Impresa Meeting |
| 17-Jun | 1000 | DE | ZEW Current Expectations Index |
BOBL TECHS: (U5) Monitoring Support
- RES 4: 119.790 High Apr 7 and the bull trigger
- RES 3: 118.600 High Apr 22
- RES 2: 118.300 High May 7
- RES 1: 118.280 High Jun 3 / 5
- PRICE: 117.660 @ 05:33 BST Jun 10
- SUP 1: 117.530 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. The sharp pullback last Thursday - for now - still appears corrective. The recovery since mid May highlights a reversal and the end of a correction in April and May. A resumption of gains would pave the way for a move towards 118.300, the May 7 high. Further out, scope would be for an extension towards 118.790, the Apr 7 high. Support to monitor is 117.470, the May 21 low. The bull trigger is 118.280, Jun 3 / 5 high.
JGBS: Twist-Flattener, Kato: Seeks More JGB Holding By Domestics
JGB futures are weaker and at Tokyo session lows, -12 compared to settlement levels.
- BoJ Governor Ueda has been before parliament, answering questions from lawmakers. The Governor noted limited policy space on the downside, given the current 0.50% policy rate. This is if fresh stimulus is needed. The real rate is being kept sub-0% to stimulate the economy further, as Ueda states that Japan is still some distance from the 2% inflation objective. Ueda reiterated that they will raise rates if they have confidence in achieving the 2% target.
- " Kato: Seeking more JGB holdings by domestic investors, will make efforts toward appropriate JGB management. Crucial to seek JGB holdings by diverse groups." – BBG
- The broader implications of greater domestic participation in JGBs may mean less outbound investment in overseas bonds (and potential equities). This could have implications for offshore debt markets.
- Cash US tsys are ~1bp cheaper in today's Asia-Pac session after yesterday's modest rally.
- Cash JGBs have twist-flattened across benchmarks, with the 7-year yield 2bps higher and the 30-year yield 1bp lower. The benchmark 10-year yield is 0.9bp higher at 1.477% versus the cycle high of 1.596%.
- Swap rates are flat to 5bps higher, with the curve steeper. Swap spreads are wider.
- Tomorrow, the local calendar will see PPI data.
