EU COMMUNICATIONS: Vodafone/Three CMA Approval

Bund futures in the middle of a tight 20-tick Asia range, -7 at 131.73.

• Bearish technicals remain intact.
• Support zone at 131.15/00 was not tested during yesterday’s morning sell off.
• To the upside, initial resistance seen at the September 2 low (132.65).
• Core global FI stuck to narrow ranges overnight, with impending U.S. election risk keeping many participants sidelined.
• Comments from ECB’s Schnabel & Vujcic due today, no tier 1 European data.
• That should leave macro headline flow and any last-minute U.S. election setup at the fore.
• In the background note that the German coalition committee will meet tomorrow, as internal government issues remain evident.
• Supply-wise, Austria will hold an RAGB auction to sell a combined EUR1.725bln of the 2.90% Feb-34 RAGB (ISIN: AT0000A39UW5) and the 3.15% Jun-44 RAGB (ISIN: AT0000A0VRQ6).

• RES 4: 0.6852/6889 High Oct 4 / 3   
• RES 3: 0.6762 High Oct 9            
• RES 2: 0.6691 50-day EMA
• RES 1: 0.6648 20-day EMA 
• PRICE: 0.6612 @ 07:09 GMT Nov 5
• SUP 1: 0.6537 Low Oct 30
• SUP 2: 0.6508 Low Aug 8
• SUP 3: 0.6490 76.4% retracement of the Aug 5 - Sep 30 bull leg
• SUP 4: 0.6472 Low Aug 6 

A bear cycle in AUDUSD remains intact. The latest pause appears to be a flag formation - a bearish continuation signal that reinforces the current trend condition. Note that the pair has cleared 0.6576, the 61.8% retracement of the Aug 5 - Sep 30 bull leg. A continuation lower would open 0.6490, the 76.4% retracement. Initial firm resistance to watch is 0.6648, the 20-day EMA.

• RES 4: 123.12 3.382 proj  of the Jun 11 - 18 - Jul 1 price swing 
• RES 3: 122.78 3.236 proj  of the Jun 11 - 18 - Jul 1 price swing
• RES 2: 121.53/122.62 High Oct 25 / 1 and the bull trigger
• RES 1: 119.97 Low Oct 11 and a recent breakout level 
• PRICE: 119.50 @ Close Nov 4
• SUP 1: 118.95 Low Oct 31     
• SUP 2: 118.64 50.0% retracement of the Jun 11 - Oct 1 bull cycle     
• SUP 3: 118.16 Low Sep 2  Low Jul 26
• SUP 4: 117.70 50.0% retracement of the Jun 11 - Oct 1 bull cycle

BTP futures maintains a softer tone, The contract traded sharply lower last week resulting in a breach of 119.97, the Oct 11 low. The break strengthens a bearish threat and highlights a possible reversal. The move down has exposed 118.64, a Fibonacci retracement point. Initial firm resistance has been defined at 121.53, the Oct 25 high, where a break is required to cancel the bearish threat.  Short-term gains would be considered corrective.