SCHATZ TECHS: (Z5) Overbought But Uptrend Remains Intact

See the full document here for a look ahead to the next two weeks of issuance, a recap of last week and a summary of Q4 issuance updates.

The Netherlands is due to hold a DDA while the EU, Belgium, Germany and Italy are all scheduled to hold auctions in the upcoming week. We pencil in issuance of E35.0bln for the week, up from E27.7bln this week.

• The EU will kick off issuance for the week by holding this morning. This will be the first auction at which the EU will hold a second non-competitive round (at which a further 20% would be available the following day). On offer will be up to E2.5bln of the 3.125% Dec-28 EU-bond (ISIN: EU000A3K4EN5), up to E2bln of the 3.375% Dec-35 EU-bond (ISIN: EU000A4D8KD2) and up to E1.5bln of the 2.625% Feb-48 Green EU-bond (ISIN: EU000A3K4DM9).
• Belgium will also come to the market today to hold a conventional auction for a combined E2.2-2.6bln. On offer will be the 0.10% Jun-30 OLO (ISIN: BE0000349580), the 3.10% Jun-35 OLO (ISIN: BE0000363722) and the 2.75% Apr-39 Green OLO (ISIN: BE0000356650).
• The Netherlands will hold a DDA tomorrow to launch the new 30-year 3.50% Jan-56 DSL (ISIN: NL0015002P70). E4.0-5.0bln will be on offer (we assume takeup at the top of the target range). As usual the preliminary initial spread guidance will be announced this afternoon.
• Also tomorrow, Germany will sell E4.5bln of the 1.90% Sep-27 Schatz (ISIN: DE000BU22106).

Germany, France, Austria, Greece and Italy are due to sell bills this week. We expect issuance to be E21.7bln in first-round operations, up from E19.1bln last week.

• This morning, Germany will look to sell E2bln of the 3-month Dec 10, 2025 Bubill and E3bln of the 9-month Jun 17, 2026 Bubill.
• This afternoon, France will look to issue up to a combined E7.4bln of 14/20/28/50-week BTFs: E2.4-2.8bln of the 14-week Dec 31, 2025 BTF, E0.0-0.4bln of the 20-week Feb 11, 2026 BTF, E1.8-2.2bln of the new 28-week Apr 9, 2026 BTF and E1.6-2.0bln of the 50-week Sep 9, 2026 BTF.
• Tomorrow morning, Austria will look to come to the market with E1bln of the 4-month Jan 29, 2026 ATB and E1.25bln of the new 6-month Mar 26, 2026 green ATB.
• On Wednesday morning, Greece will look to sell E500mln of the new 26-week Mar 27, 2027 GTB.
• Finally on Thursday morning, Italy will look to hold a BOT auction, selling a new 6-month BOT potentially alongside another existing BOT. Details will be announced this afternoon.

• RES 4: 107.240 High Aug 4 
• RES 3: 107.225 High Aug 27 and the bull trigger 
• RES 2: 107.145/190 High Sep 11 / High Sep 5 and 8
• RES 1: 107.050 Low Aug 25 and Sep 2 and a recent breakout level 
• PRICE: 106.955 @ 06:17 BST Sep 22
• SUP 1: 106.955 Intraday low  
• SUP 2: 106.948 1.382 proj of the the Aug 27 - Sep 2 - 8 price swing  
• SUP 3: 106.928 1.500 proj of the the Aug 27 - Sep 2 - 8 price swing
• SUP 4: 106.900 Round number support

The trend structure in Schatz futures remains bearish and recent weakness confirms a resumption of the downtrend. The contract has breached support at 107.050, the Aug 25 and Sep 2 low plus a bear trigger. Price has also traded to a fresh short-term cycle low today. This maintains the downward price sequence of lower lows and lower highs. Sights are on 106.948 next, a Fibonacci projection. Initial resistance is at 107.050, Aug 25 and Sep 2 low.