SCHATZ TECHS: (Z5) Bear Leg Extension
- RES 4: 107.320 High Oct 17 and the bull trigger
- RES 3: 107.235 High Oct 22
- RES 2: 107.175 High Oct 24
- RES 1: 107.055/082 20- and 50-day EMA values
- PRICE: 106.980 @ 06:47 GMT Nov 14
- SUP 1: 106.970 Intraday low
- SUP 2: 106.960 Low Oct 2
- SUP 3: 106.945 Low Oct 1
- SUP 4: 106.920 Low Sep 25 and a key support
A short-term bear cycle in Schatz futures remains intact and today’s fresh cycle low reinforces bearish conditions. The move down paves the way for an extension towards 106.960, the Oct 2 low. Scope is also seen for a test of 106.920, the Sep 25 low and a key support point. Initial resistance to watch is 107.055, the 20-day EMA. Resistance at the 50-day EMA is at 107.082. The area between the two averages represents a key short-term resistance zone.
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USDCAD TECHS: Bullish Theme
- RES 4: 1.4200 Round number resistance
- RES 3: 1.4167 50.0% retracement of the Feb 3 - Jun 16 bear leg
- RES 2: 1.4111 High Apr 10
- RES 1: 1.4080 Intraday high
- PRICE: 1.4033 @ 08:04 BST Oct 15
- SUP 1: 1.3939/3870 20- and 50-day EMA values
- SUP 2: 1.3802 Bull channel base drawn from the Jul 23 low
- SUP 3: 1.3727 Low Aug 29 and a bear trigger
- SUP 4: 1.3689 Low Jul 28
A bull cycle in USDCAD remains intact and this week’s gains reinforce current conditions. Last Thursday’s rally confirmed a recent bull flag on the daily chart and a resumption of the current uptrend. MA studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.4111, the Apr 10 high, and further out scope is seen for an extension towards 1.4167, a Fibonacci retracement. First key support is 1.3870, 50-day EMA.
STIR: Euribor Futures Off Yesterday's Highs As French Risks Fade
Euribor futures are flat to +3.0 ticks through the blues, but ERZ6 (+2.0 at 98.100) remains shy of yesterday’s 98.115 high. An easing of French political risks helped futures away from dovish extremes through the course of yesterday afternoon.
- Yesterday evening, Banque de France Governor Villeroy said that if the ECB was to move again, a cut is more likely than a hike. This is in line with his prior rhetoric and not a surprise to us.
- Makhlouf’s comments this morning are somewhat more interesting. He said that inflation risks are slightly skewed to the upside. Most other Governing Council members (other than Schnabel) have said that risks are broadly balanced, with a handful expressing downside concerns.
- Today’s regional data calendar includes Eurozone August IP. Country level data has pointed to weak IP developments, culminating in a -1.6% M/M consensus. It's not expected to be market moving.
- ECB’s de Guindos and Villeroy (again) are scheduled to speak today.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Oct-25 | 1.923 | -0.4 |
| Dec-25 | 1.889 | -3.8 |
| Feb-26 | 1.869 | -5.8 |
| Mar-26 | 1.813 | -11.4 |
| Apr-26 | 1.795 | -13.2 |
| Jun-26 | 1.765 | -16.2 |
| Jul-26 | 1.758 | -16.9 |
| Sep-26 | 1.752 | -17.5 |
| Source: MNI/Bloomberg Finance L.P. | ||
EGBS: Bund Futures Lifted by French OATs as Political Risk Recedes
Bund futures trade in positive territory through the European cash open, supported by yesterday's appearance from Fed's Powell. Speaking just after the European close, Powell signaled that the FOMC were on track for another rate cut at its next meeting.
Bunds are testing session highs, but are led by French OATs as political risks continue to ease in France after key opposition members announced they would not support a no confidence motion.
- TECHNICALS: The next target for the French 10yr Yield is at 3.35% (123.22). For the German 10yr Yield this comes at 2.55% which Equated to 130.23 Yesterday. The initial support is unchanged at 129.13.
- DATA: Today's Data include France, Spain final CPIs and out of the US, MBA, Empire State Manufacturing.
- SUPPLY: UK £1.5bn 2031 linker (unlikely to impact Gilts), German 25s, 30s (equates combined 17.7k Buxl), which should weigh into the bidding deadline.
- SPEAKERS: ECB's de Guindos, Villeroy, BoE's Ramsden, Breeden, Fed's Miran (x2), Waller and Schmid.
