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Review $48B 5Y Note Auction: Small Tail

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MARKET INSIGHT
  • In the equity space, S&P E-minis found support last week at 3843.25, the Mar 25. The recovery means the 50-day EMA remains intact. Initial resistance to watch is 3978.50, Mar 18 high. A break would resume the uptrend and expose 4000. Key short-term support is at 3843.25. EUROSTOXX 50 has traded to a fresh trend high today. This reinforces the underlying bullish theme and opens 3889.08, 1.618 projection of Dec 21 - Jan 8 rally from Jan 28 low
  • In the FX space, EURUSD maintains a weaker tone. The focus on 1.1752 next, 1.236 projection of the Jan 6 - Feb 5 - Feb 25 price swing. The GBPUSD outlook remains bearish and recent gains are likely a correction. The pair last week cleared a bull channel base drawn off the Nov 2 low. The focus is on 1.3641, 38.2% of the Sep 23 - Feb 24 bull cycle. Resistance, at the former channel base, is 1.3854. USDJPY remains bullish having traded to fresh 2021 highs Friday. The break opens 110.00 and the 110.63 Fibonacci projection, 0.764 of the Mar - Apr 2020 rally from the Jan 6 low.
  • On the commodity front, Gold is consolidating with support at $1719.3, Mar 18 low. A break above $1755.50 is needed to trigger a fresh round of gains. This would open the 50-day EMA at $1773.9. A break of support would be bearish. Resistance to watch in Brent (K1) is at $65.12, Mar 22 high. In WTI (K1), the resistance level to watch is $62.04, Mar 22 high. A break off these two hurdles would be bullish.
  • In the space, Bunds (M1) are lower this morning however recent gains suggest scope for an extension higher. The next resistance is at 172.78, 0.764 projection of the Feb 25 - Mar 11 - Mar 18 price swing. 171.73, the 20-day EMA marks support. Gilts (M1) last week cleared resistance at 128.33, Mar 16 high, suggesting scope for an extension higher. The next key resistance is at 129.27, Mar 2 high.
MNI London Bureau | +44 203-586-3805 | taso.anastasiou.ext@marketnews.com

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