FOREX: USD Remains in Favour Thanks to Recent CHF Slippage
USD remains in favour headed into the NY crossover, with another circuit-breaker tripped in Turkish equities, underpinning the strength in the greenback today. The USD Index is still comfortably below last week's highs, but is building a decent base here thanks to EUR weakness this morning, and in very recent trade, slippage for the CHF.
- USD/CHF has just printed new intraday highs - exposing the 0.8800 handle and reverting toward the 200-dma (0.8815) - a level that's proved influential over the past two weeks, as markets struggle for conviction in either direction.
- No surprise to see very solid volumes and participation so far Wednesday, with EUR futures printing activity over 50% ahead of average for this time of day, JPY 70% above, GBP 50% above and AUD 60% above average.
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US 10YR FUTURE TECHS: (H5) Remains Above Last Week’s Lows
- RES 4: 110-25 High Dec 12
- RES 3: 110-19 76.4% retracement of the Dec 6 - Jan 13 bear leg
- RES 2: 110-14 High Dec 14
- RES 1: 110-00 High Feb 7 and the bull trigger
- PRICE: 109-05+ @ 10:53 GMT Feb 17
- SUP 1: 108-04/00 Low Feb 12 / Low Jan 16
- SUP 2: 107-06 Low Jan 13 and the bear trigger
- SUP 3: 107-04 Low Apr 25 ‘24 and a key support
- SUP 4: 106-11 2.00 proj of the Oct 1 - 14 - 16 price swing
Treasury futures remain above last week’s lows and price has risen above the 50-day EMA. A continuation higher would expose key resistance and a bull trigger at 110-00, the Feb 7 high. For bears, recent weakness resulted in a break of 108-20+, the Feb 4 low, highlighting the end of the corrective cycle between Jan 13 - Feb 7. A continuation lower would open 108-00, the Jan 16 low, and expose 107-06, the Jan 13 low and bear trigger.
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BONDS: BTP/Bund spread tests immediate support area
- The BTP/Bund spread is back at the 106.00bps level, 1.9bp tighter so far on the Day.
- The spread has found support multiple time at this level, back in December, January and also this Month.
- Technically, we could be having a falling wedge, would be bullish, but investors will be watching how it develops at these lower levels.
- A clear break through 106.00bps, opens to the Psychological 100.00, although better will be seen nearer the ~97.7bps area.
(Chart source: MNI/Bloomberg).
