FOREX: USD Further in Favour Through NY Crossover
Jun-13 10:58
- Dollar finding further support headed into the NY crossover, helping pressure EUR/USD through the overnight low and extend the backtrack from yesterday's high to over 125 pips.
- We note above that a broader bullish EUR theme remains intact, however a sharper sell-off from here could prompt a further liquidation of longs (data from June 3rd shows EUR net long holding close to 12-month highs) and a break of 1.1389, the 20-day EMA, could trigger momentum selling and a S/T correction. Today's price action suggests any material pick-up in geopolitical tensions via an official Iranian response, or via disruption of shipping through the Red Sea, would prove supportive of the USD again.
- While EUR was the key beneficiary to USD weakness yesterday, it is among today's poorest performers (after risk-led AUD, NZD), prompting EUR/GBP to fade off yesterday's June high despite backtracking ECB pricing for 2025.
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EQUITIES: Credit Agricole Put Option
May-14 10:56
XCA (20th June) 14p, sold at 0.03 and 0.06 in 6.5k.
US TSYS: Modestly Firmer In A Thin Docket Before A Busy Thursday
May-14 10:50
- Treasuries are slightly firmer overnight, more comfortably back in the middle of yesterday’s range awaiting fresh drivers.
- It’s a thin data docket today (just weekly mortgage data) which sees Fed Vice Chair Jefferson in a little more focus at 0910ET, and with an eye on tomorrow’s April reports for US PPI and retail sales amongst others.
- US President Trump flies from Saudi Arabia to Qatar today.
- Cash yields are 0.5-1.5bp lower on the day, with declines led by the belly.
- TYM5 sits at 110-06+ (+ 07+) as it lifts a little more off yesterday’s latest lows of 109-30, on modest cumulative volumes of 280k.
- Technicals point to a bear mode condition, having most recently cleared support at 110-01+ (76.4% retrace of Apr 11 – May 1 bull leg) in a step closer to key support at 109-08 (Apr 11 low).
- Data: MBA mortgage applications (0700ET)
- Fedspeak: Jefferson (0910ET), Daly (1740ET) – see STIR bullet
- Bill issuance: US Tsy to sell $60bn 17-w bills (1130ET)
LOOK AHEAD: Wednesday Data Calendar: Fed Speak Goolsbee, Waller, Jefferson, Daly
May-14 10:49
- US Data/Speaker Calendar (prior, estimate)
- 14-May Chicago Fed Goolsbee appr 30 minutes into NPR's Morning Edition
- 14-May 0515 Fed Gov Waller on central bank research (text, Q&A)
- 14-May 0700 MBA Mortgage Applications (11.0%, --)
- 14-May 0910 Fed VC Jefferson economic outlook (text, no Q&A)
- 14-May 1130 US Tsy $60B 17W Bill auction
- 14-May 1740 SF Fed Daly fireside chat (no text, Q&A)
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