Futures Consolidate Off Yesterday’s High

Hawkish BoJ speculation on the back of the latest round of news flow tempered any bids during Asia-Pac hours, leaving Bund futures +18 at typing, ~30 ticks shy of their Thursday peak.

• Bund futures have rallied sharply this week. The move has resulted in a break of resistance at the 20-day EMA, which intersects at 132.72. This strengthens the short-term bull cycle and a continuation higher would open 133.68, the Jul 5 high. For bears, a reversal lower would refocus attention on key support at 130.60, the Jul 10 low. Note that the medium-term trend direction remains down.
• There hasn’t been much in the way of meaningful regional headline flow out of Europe overnight, which leaves participants assessing cross-market moves early on Friday.
• Eurozone trade balance will cross later today but shouldn’t be a market mover, leaving participants on headline and cross-market watch into the weekend.