LATAM FX: USDBRL Support Remains Exposed
Jun-04 18:04
- Despite further greenback weakness following the weaker-than-expected ADP employment and soft ISM services print in the US, Latam currencies have traded in a relatively contained range today.
- Andean FX have outperformed, buoyed by a bounce in copper prices, with CLP rising by 0.5% against the dollar and PEN by 0.3%. The move brings USDCLP towards the bottom of its recent range near 935, while USDPEN sits close to two-year lows at 3.61.
- For USDCLP, a bear threat remains present following recent weakness, with scope still seen for a deeper retracement towards 914.00, the Mar 18 low.
- Meanwhile, USDMXN has edged down by 0.3% below 19.19, close to fresh cycle lows reached earlier in the session. With short-term resistance at the 20-day EMA continuing to cap gains for the pair, the trend condition remains bearish, with sights on 19.1120, the Oct 4 2024 low.
- In contrast, USDBRL is broadly unchanged at 5.64, unwinding earlier losses which saw the pair narrow the gap to key medium-term support around the 5.60 mark. The USDBRL trend outlook remains bearish, and attention stays on 5.5933, the Apr 3 low, a clear break of which would open 5.4969, the Oct 8 ‘24 low.
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EURGBP TECHS: Bear Threat Remains Present
May-05 18:00
- RES 4: 0.8781 2.236 proj of the Mar 3 - 11 - 28 price swing
- RES 3: 0.8768 High Nov 20 ‘23
- RES 2: 0.8624/0.8738 High Apr 21/ High Apr 11 and the bull trigger
- RES 1: 0.8557 High Apr 28
- PRICE: 0.8521 @ 16:30 BST May 5
- SUP 1: 0.8480 Low May 1
- SUP 2: 0.8477/65 61.8% of the Mar 28 - Apr 11 rally / 50-day EMA
- SUP 3: 0.8415 76.4% retracement of the Mar 28 - Apr 11 rally
- SUP 4: 0.8316 Low Mar 28 and a key support
EURGBP has recovered from its latest lows, however a sell-on-rallies theme last week could cap gains and keep focus on the current bear cycle. Sights are on 0.8477, a Fibonacci retracement point where a break would strengthen the bearish theme. Support at the 50-day EMA, is at 0.8465. It is still possible the move down that started Apr 11, is a correction. A clear reversal would open 0.8738, the Apr 11 high and bull trigger.
PIPELINE: Corporate Bond Update: $4.5B Apple Inc 4Pt Launched
May-05 17:52
Low end of the estimate, $4.5B Apple Inc 4pt deal leads today's issuance size:
- Date $MM Issuer (Priced *, Launch #)
- 05/05 $4.5B #Apple Inc $1.5B 3Y +25, $1B 5Y +30, $1B 7Y +40, $1B 10Y +50
- 05/05 $2.5B #Comcast $650M 7Y +85, $850M 10Y +100, $1B 30Y +122
- 05/05 $2B #General Motors $750M 3Y +155, $750M 5Y +170, $500M 10Y +195
- 05/05 $1.3B #DTE Electric $300M 2Y +45, $500M 10Y +93, $500M 30Y +103
- 05/05 $1.25B #American Int Group $625M each: 5Y +95, 10Y +112
- 05/05 $1.25B #Prologis $500M +5Y +85, $750M 10Y +103
- 05/05 $1B #ADP 7Y +63
US TSYS: Back to Bear Steepening, Bonds Extend Lows
May-05 17:48
- Treasury futures are extending late session lows at the moment, curves maintaining steeper profiles as short end rates keep pace with bonds: 2s10s +2.959 at 51.191, 5s30s +2.187 at 89.067.
- Tsy Jun'25 10Y contract trades -8.5 to 110-28.5, session low - through 50-day EMA at 110-30.5 -- strengthening a bearish threat and exposing 110-16+, the Apr 22 low.
