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Price Signal Summary - Gilts Remain Above Support For Now

OUTLOOK
  • In the FI space, a bull cycle in Bund futures remains in play and recent gains reinforce the current trend condition. 133.21, the Jun 14 high, was cleared on Jul 29, confirming a resumption of the uptrend. Moving average studies are in a bull-mode position, highlighting a rising trend. Sights are on 136.45, 76.4% of the Dec 27 - May 31 downleg (cont). The contract is off Monday’s high, an extension down would allow an overbought condition to unwind. Support is at 133.34, 20-day EMA.
  • Gilt futures traded higher last week, marking a confirmation of the uptrend that started May 29. Monday's high reinforces current conditions. Note that 99.23, the Jun 21 peak, has been cleared. Scope is seen for a climb towards 101.78, the 2.236 projection of the May 29 - Jun 4 - 10 price swing. The latest pullback is considered corrective, allowing an overbought trend condition to unwind. Support to watch is 98.99, the 20-day EMA.

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