Brief & Limited UK Data-Inspired Cheapening Unwound

A firmer than expected round of UK retail sales data initially pushed Bunds towards Thursday’s low, although bears failed to force a meaningful test before the contract edged away from worst levels to last print a few ticks higher on the session.

• Technically, the pullback from this week’s highs puts futures back within range of the 50- and 100-DMAs, however momentum remains clearly in favour of bulls at these levels. Any continuation higher would ultimately open 135.00, the Jun 27 high and key resistance. For bears, a reversal lower would refocus attention on key support at 130.60, the Jul 10 low.
• French retail sales data presents the highlight of a very limited regional docket ahead of the weekend, with little in the way of U.S. needle-movers apparent. That will leave headlines, cross-market flow and position adjustments ahead of next week’s ECB & FOMC decisions at the fore.
• A quick reminder that the pre-meeting ECB quiet period is underway.