CROSS ASSET: USD is in the Green against the majors, US Treasuries are steady
- The Dollar is in the green against all the majors, only the Yen is benefitting, up 0.32%, but still well within Yesterday's range for the Japanese Yen.
- New fresh high for the Dollar versus the EUR, GBP, INR, KRW, CAD, MXN, CZK, SEK, CHF, SGD, ILS, and PLN.
- While EGBs are seeing an underlying bid, but still well within this Week's range, US Treasuries are far more subdued and unmoved, as Tnotes stays within its 4.5 ticks range, in way below average Volumes.
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USD: Buying interest emerging
- The Dollar was mostly flat against G10s overnight, AUD was up a small 0.14%, and the Yen was the standout worst performer, was down 0.59%, but has pared small losses to sits at -.48% since the Cash Govie open.
- The early price action in Europe has seen Bund closing its opening gap, clearing through Friday's high, which has in turn provided an underlying bid in Treasuries, if Cash was open, Yield will be a touch lower.
- Despite the early price action in Europe, new record highs for US Equities, Yields leaning lower, the Dollar is still now in the green across G10, Cable has dropped some 25 pips since the EU Cash Govie open, albeit well within last Week's range.
- The Greenback tests session high versus the PLN, SEK, CZK, GBP, EUR, CHF, SGD.
- EURUSD makes an attempt at 1.0700, ahead of support at 1.0683 Low Nov 6.
STIR: 125bp Of Cuts Priced For Next 5 ECB Meetings
EUR STIRs flat to a little more dovish this morning.
- ECB-dated OIS sits around levels seen late Friday, showing 29bp of cuts for December, 92bp of cuts through March and 125bp of cuts through June.
- On face value, that leaves 5x 25bp cuts fully discounted over the next 5 meetings, although a more granular inspection points to some pricing of the chance of 50bp steps over the next 3 meetings.
- Euribor futures rally alongside Bunds, last 1.5-5.5 firmer.
- The weekend saw ECB hawk Holzmann tell Kleine Zeitung that “as things currently stand, the possibility (of a rate cut in December) exists, there’s nothing at the moment that would speak against it, but that doesn’t mean that it will automatically happen.” No real surprise there, although he could have chosen to push back against market pricing of a 50bp move.
- That came after ECB GC member Makhlouf reaffirmed the need for “careful pacing” of policy loosening late on Friday.
- Tomorrow’s ZEW readings and Thursday’s Eurozone GDP prints headline this week’s regional data schedule, while ECB rhetoric will pick up from tomorrow.
ECB Meeting | €STR ECB-Dated OIS (%) | Difference Vs. Current Effective €STR Rate (bp) |
Dec-24 | 2.875 | -28.8 |
Jan-25 | 2.552 | -61.1 |
Mar-25 | 2.245 | -91.8 |
Apr-25 | 2.051 | -111.2 |
Jun-25 | 1.911 | -125.2 |
Jul-25 | 1.842 | -132.1 |
Sep-25 | 1.785 | -137.8 |
Oct-25 | 1.772 | -139.1 |
EQUITY TECHS: E-MINI S&P: (Z4) Northbound
- RES 4: 6070.16 1.382 projection of the Sep 6 - 17 - 18 price swing
- RES 3: 6033.58 1.236 proj of the Apr 19 - Jul 16 - Aug 5 price swing
- RES 2: 6028.44 1.236 projection of the Sep 6 - 17 - 18 price swing
- RES 1: 6040.50 High Nov 8
- PRICE: 6037.25 @ 07:19 GMT Nov 11
- SUP 1: 5927.25 High Oct 17 and a recent breakout level
- SUP 2: 5863.50/5724.25 20-day EMA / Low Nov 4
- SUP 3: 5675.25 Low Sep 18
- SUP 4: 5658.00 Low Sep 13
Bullish conditions in S&P E-Minis remain intact and last week’s gains reinforce current conditions. A key short-term support has been defined at 5724.25, Nov 4 low. The move higher last week resulted in a breach of the bull trigger at 5927.25, Oct 17 high, confirming a resumption of the primary uptrend. The 6000.0 psychological handle has been pierced. Sights are on 6070.16, a Fibonacci projection. Initial support is at 5927.25, the Oct 17 high.
