BTP TECHS: (Z5) Support Remains Intact
- RES 4: 122.56 0.764 proj of the Apr 9 - May 8 - 14 price swing (cont)
- RES 3: 121.88 0.618 proj of the Apr 9 - May 8 - 14 price swing (cont)
- RES 2: 121.00 Round number resistance
- RES 1: 120.74 High Aug 5 and the bull trigger
- PRICE: 119.52 @ Close Sep 24
- SUP 1: 119.06/118.36 Low Sep 4 / 3
- SUP 2: 118.00 Round number support
- SUP 3: 117.70 2.236 proj of the Aug 5 - 12 - 14 price swing
- SUP 4: 117.36 2.500 proj of the Aug 5 - 12 - 14 price swing
The primary trend condition in BTP futures is unchanged, the set-up remains bullish and the latest pullback is considered corrective. The strong rally that started Sep 3 reinforces a bull theme and signals the end of the corrective pullback between Aug 5 - Sep 3. Key resistance and the bull trigger is 120.74, the Aug 5 high. A break of this hurdle would confirm a resumption of the uptrend. Key support has been defined at 118.36, the Sep 3 low.
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BTP TECHS: (U5) In A Range
- 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: 120.11 @ Close Aug 25
- 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, it remains bullish. However, for now, the contract continues to trade 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 highlight a range breakout and a bearish threat. Key resistance is unchanged at 121.73, the Jun 13 high.
EURJPY TECHS: Structure Remains Bullish
- RES 4: 177.08 2.000 proj of the Feb 28 - Mar 18 - Apr 7 price swing
- RES 3: 175.43 High Jul 11 ‘24 and a key medium-term resistance
- RES 2: 174.86 1.764 proj of the Feb 28 - Mar 18 - Apr 7 price swing
- RES 1: 173.02/97 High Aug 13 / High Jul 28 and the bull trigger
- PRICE: 171.96@ 06:59 BST Aug 26
- SUP 1: 170.51 50-day EMA
- SUP 2: 169.73/45 Low Jul 31 / 23.6% of the Feb 28 - Jul 28 bull leg
- SUP 3: 168.46 Low Jul 1
- SUP 4: 167.46 Low Jun 23
The trend structure in EURJPY remains bullish and the cross is trading closer to its recent highs. Key support to watch lies at the 50-day EMA at 170.51. A clear break of the average is required to highlight a stronger short-term bearish threat. Moving average studies are in a bull-mode position reinforcing the primary uptrend. Clearance of the Jul 28 high of 173.97, would confirm a continuation of the bull cycle.
EUROZONE ISSUANCE: EGB Supply Daily (2/2)
- Germany will come to the market tomorrow, reviving the 7-year Bund through the launch of its new Nov-32 Bund as issuance demands have increased in H2. The coupon for the new line is to be confirmed this morning.
- Italy will return to the market on Thursday with a 5/10-year BTP / CCTeu auction. On offer will be E2.00-2.75bln of the on-the-run 5-year 2.70% Oct-30 BTP (ISIN: IT0005654642), E1.00-1.25bln of the 3.65% Aug-35 BTP (ISIN: IT0005631590), E1.75-2.00bln of the on-the-run 10-year 3.60% Oct-35 BTP (ISIN: IT0005648149) and E1.50-2.00bln of the 1.05% Apr-34 CCTeu (ISIN: IT0005652828).
- Finally, Finland will hold an ORI operation on Thursday, with up to E0.4bln on offer. Details of the RFGBs on offer will be released the preceding day.
NOMINAL FLOWS: This week sees no redemptions (also the case last week). Coupon payments for the week total E0.6bln, of which E0.5bln are Italian. This leaves estimated net flows for the week at a positive E29.2bln, up from E22.6bln last week.
