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Price Signal Summary - Gilts Remains Below Last Week's High

  • In the FI space, Bund futures remain in a short-term uptrend and despite the latest pullback, are still trading closer to their recent highs. Attention is on resistance at the 50-dma of 130.18. Clearance of this level would strengthen bullish conditions and pave the way for a climb towards 131.33, a Fibonacci retracement point. Initial support to watch lies at 128.61, the Oct 10 low. A break would signal a potential top. Note that recent gains are considered corrective.
  • Gilt futures faced resistance last Thursday and 95.66, the Oct 12 high, has been defined as a key short-term hurdle for bulls. The contract traded lower Monday, starting the week on a bearish note. Support to watch lies at 93.04, the Oct 10 low. A breach would highlight a stronger reversal and open key support and the bear trigger that lies at 91.47, the Aug 17 low. For bulls, a clearance of 95.66 would instead confirm a resumption of the recent rally.

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