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OUTLOOK: Price Signal Summary - Bear Leg In Gilts Extends

OUTLOOK
BulletMarketsFixed Income BulletsForeign Exchange Bullets
  • In the FI space, Bund futures traded sharply higher Tuesday resulting in a break above key resistance at 135.66 - a bullish development. However, the contract has pulled back from its latest highs and is trading lower again, today. The move down appears to be a correction - for now. However, the 20-day EMA has been breached, exposing the 50-day EMA, at 133.99. For bulls, a reversal higher would refocus attention on 136.20, the Oct 1 high and bull trigger.
  • A bear threat in Gilt futures remains present - for now - and this week’s extension reinforces the bearish theme. The contract has traded through support at 98.11, the Sep 2 low and a bear trigger. The break strengthens the downtrend, signalling scope for a deeper retracement, towards 97.47, 0.618 projection of the Sep 17 - 30 - Oct 1 price swing. Initial firm resistance has been defined at 99.47, the Oct 1 high and just above the 20-day EMA.
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  • In the FI space, Bund futures traded sharply higher Tuesday resulting in a break above key resistance at 135.66 - a bullish development. However, the contract has pulled back from its latest highs and is trading lower again, today. The move down appears to be a correction - for now. However, the 20-day EMA has been breached, exposing the 50-day EMA, at 133.99. For bulls, a reversal higher would refocus attention on 136.20, the Oct 1 high and bull trigger.
  • A bear threat in Gilt futures remains present - for now - and this week’s extension reinforces the bearish theme. The contract has traded through support at 98.11, the Sep 2 low and a bear trigger. The break strengthens the downtrend, signalling scope for a deeper retracement, towards 97.47, 0.618 projection of the Sep 17 - 30 - Oct 1 price swing. Initial firm resistance has been defined at 99.47, the Oct 1 high and just above the 20-day EMA.