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Price Signal Summary - Bearish Extension In Bunds

OUTLOOK
  • In the FI space, Bund futures traded sharply lower yesterday. The move down reinforces a bearish theme. Support at 133.45 has been cleared, the May 30 low and attention is on 133.00, 76.4% of the May 26 - Jun 1 rally. This level has been pierced, a clear breach would open 132.12, the May 26 low and key support. On the upside, initial firm resistance is seen at 134.18, the 20-day EMA.
  • Gilt futures have pulled back from recent highs. Recent gains are considered corrective and the trend direction remains down. Moving average studies are in a bear-mode position highlighting a bear cycle. A continuation lower would open 94.00. The bear trigger is 94.21, the May 26 low. Initial firm resistance to watch is at 97.64, the Jun 1 high.

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