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30 Dec 2014
Peripheral spreads outside Greece hold up well – RBS
FXStreet (Barcelona) - Analysts at RBS note that the ongoing Eurozone concerns due to the political uncertainty in Greece has kept the peripheral spreads outside Greece to hold up well, with major effect seen in Greek assets and European equities.
Key Quotes
“Greece has stirred some concerns over the last few days in regards to the Eurozone, but the concerns have been limited to Greek assets and European equity markets.”
“Peripheral spreads outside Greece have held in well, in fact as noted above Italy auctioned 10yr notes below 2% for the first time ever, a new record low. Part of this is that spreads have been generally stable while bunds have crept ever lower in yield – dragging others down with it. Treasuries are part of this crowd, and in a holiday shortened week where US bonds are the tail and not the dog doing the wagging, it's advisable to stay a spectator.”
“2s (0.739%)– Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.47% and then at 0.40% where we'd close a gap left behind in late October. Daily momentum is oversold and looking to turn bullishly.”
“5s (1.756%)– Next major support comes in at 1.80% and just above. First resistance emerges at 1.47% and then major resistance lines up at ~1.27%. Daily momentum is still bearish (close to turning) and nearing oversold readings.”
“10s (2.25%)–Next major resistance comes in at the flash crash lows ~1.86%. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is still bearish.”
“30s (2.82%)– Bonds don't have any solid support until 3.105%, the November "lows." Next resistance is at ~2.50%, the all-time rate lows for bonds. Daily momentum is bearish.”
Key Quotes
“Greece has stirred some concerns over the last few days in regards to the Eurozone, but the concerns have been limited to Greek assets and European equity markets.”
“Peripheral spreads outside Greece have held in well, in fact as noted above Italy auctioned 10yr notes below 2% for the first time ever, a new record low. Part of this is that spreads have been generally stable while bunds have crept ever lower in yield – dragging others down with it. Treasuries are part of this crowd, and in a holiday shortened week where US bonds are the tail and not the dog doing the wagging, it's advisable to stay a spectator.”
“2s (0.739%)– Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.47% and then at 0.40% where we'd close a gap left behind in late October. Daily momentum is oversold and looking to turn bullishly.”
“5s (1.756%)– Next major support comes in at 1.80% and just above. First resistance emerges at 1.47% and then major resistance lines up at ~1.27%. Daily momentum is still bearish (close to turning) and nearing oversold readings.”
“10s (2.25%)–Next major resistance comes in at the flash crash lows ~1.86%. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is still bearish.”
“30s (2.82%)– Bonds don't have any solid support until 3.105%, the November "lows." Next resistance is at ~2.50%, the all-time rate lows for bonds. Daily momentum is bearish.”