January 27, 2025 12:20 GMT
OUTLOOK: Price Signal Summary - Short-Term Bull Cycle In Gilts Remains Intact
OUTLOOK
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- In the FI space, the pullback from recent highs in Bund futures appears corrective and a short-term bull cycle is in play for now. The Jan 15 rally highlighted a reversal signal - a bullish engulfing candle. It continues to suggest scope for a corrective phase that is allowing an oversold trend condition to unwind. Sights are on 132.15, the 20-day EMA. A clear breach of the average would strengthen the bullish theme. The bear trigger is at 130.28, the Jan 15 low. Initial support lies at 131.00, the Jan 16 / 24 low.
- The medium-term trend condition in Gilt futures remains bearish. However, recent gains continue to highlight a corrective phase and signal scope for a continuation higher near-term. The focus is on 92.75, the 50.0% retracement of the Dec 3 - Jan 13 bear leg. Initial support is at 91.10, the Jan 20 low.
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