BTP TECHS: (Z5) Resistance Remains Exposed

• Headline just 7 hundredths above the BOE's forecast
• Air fares alone added 11 hundredths to headline CPI and accommodation 9 hundredths. That more than accounts for the upside surprise alone and is unlikely to be persistent (although accommodation may surprise to the upside again next month with Oasis in Edinburgh and the Fringe coinciding).
• Those categories alone accounted for a 4 tenth increase in services CPI, which only came in 10 hundredths above the BOE's forecast.
• Food and non-alcoholic beverages were 21 hundredths above the BOE's forecast.
• Energy only a marginal surprise for the BOE (larger surprise for consensus as we flagged the possibility of as it didn't appear consensus took into account the methodology change this year).
• So all in all, this print is nowhere near as concerning as it appears at first glance.
• GBPUSD is now only 5 pips above its pre-CPI levels.

• RES 4: 122.35 2.500 proj of the May 14 - 20 - 21 price swing
• RES 3: 122.00 Round number resistance 
• RES 2: 121.73 High Jun 13 and the bull trigger 
• RES 1: 121.13 High Aug 15
• PRICE: 120.39 @ Close Aug 19
• SUP 1: 119.59 Low Jul 25 and key short-term support         
• SUP 2: 119.48 Low May 26 
• SUP 3: 118.87 Low May 21  
• SUP 4: 118.51 Low May 14 and key support 

The primary trend condition in BTP futures is unchanged and the outlook remains bullish. However, for now, the contract is trading inside a range and the Aug 15 sell-off signals scope for a move towards the lower end of the range. Key support to watch lies at 119.59, the Jul 25 low. A clear break of this level would mark a range breakout and highlight a bearish threat. Key resistance is unchanged at 121.73, the Jun 13 high

• RES 4: 5575.00 High Mar 3 and a major resistance (cont) 
• RES 3: 5568.00 High Mar 6  
• RES 2: 5526.00 High Mar 19 / 20 (cont) 
• RES 1: 5501.00 High Aug 19 
• PRICE: 5466.00 @ 06:46 BST Aug 20
• SUP 1: 5382.93 20-day EMA
• SUP 2: 5355.64 50-day EMA 
• SUP 3: 5280.00 Low Aug 7 
• SUP 4: 5249.00 Low Aug 5   

The trend set-up in Eurostoxx 50 futures remains bullish and the contract traded to a fresh short-term cycle high yesterday. The print above the May and July highs strengthens a bull theme and signals scope for a climb towards 5575.00, the Mar 3 high (cont) and key resistance. Moving average studies remain in a bull-mode position, highlighting an uptrend. Support to watch lies at 5355.64, the 50-day EMA.