May 20, 2024 11:04 GMT
Price Signal Summary - Initial Firm Support In Gilts Remains Intact For Now
OUTLOOK
- In the FI space, Bund futures remain below last week’s high. The rally last Wednesday resulted in a print above the 50-day EMA and a breach of a key resistance at 131.86, the May 7 high. This continues to highlight a potential reversal, however a break of 132.11, the May 16 high, is required to reinforce a bullish condition. For bears, a breach of support at 130..24, May 14 low, would instead expose the key support and bear trigger at 129.53, the Apr 25 low.
- Gilt futures have pulled back from their recent highs. A break of 98.76, the May 16 high, would confirm a resumption of the current bull cycle and this would signal scope for a climb towards 99.19, 76.4% of the Mar 12 - Apr 25 bear leg. Initial firm support has been defined at 97.23, the May 14 low. Clearance of this level would instead be viewed as a bearish development.
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