US STOCKS: Late Equities Roundup: Banks Continue To Underperform
* Stocks remain weaker late Thursday, near morning lows as Financial and Consumer Discretionary se...
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EURGBP TECHS: Bullish Outlook
- RES 4: 0.8545 High Aug 21
- RES 3: 0.8530 76.4% retracement of the Aug 8 - Dec 19 downleg
- RES 2: 0.8494 High Aug 26 ‘24
- RES 1: 0.8474 High Jan 20
- PRICE: 0.8454 @ 16:06 GMT Jan 21
- SUP 1: 0.8403/8364 Low Jan 16 / 20-day EMA
- SUP 2: 0.8341 50-day EMA
- SUP 3: 0.8284 Low Jan 8
- SUP 4: 0.8263 Low Dec 31
A bull cycle in EURGBP remains intact and the cross is holding onto its latest gains. Recent gains undermine a bearish theme and suggest scope for stronger short-term recovery. Resistance points at 0.8376, the Nov 19 high, and 0.8448, the Oct 31 high, have been breached, strengthening the current bullish theme. Sights are on 0.8494 next, the Aug 26 ‘24 high. Support at the 50-day EMA is at 0.8341.
MACRO ANALYSIS: Eurozone Macro Signal – Jan 2025: Is The Worst Yet To Come?
Eurozone economic activity continues to be mixed at best across sectors and countries. Despite an uptick on an aggregate basis in Q3, mid-term growth momentum is subdued, with low investment and net exports, while household consumption is seen to exhibit some relative strength. The economic outlook for the bloc became more clouded in recent months amid subdued sentiment and expectations for a less favourable global environment going forward.
- Economic Activity: Final GDP growth printed 0.4% Q/Q in Q3, but Q4 is only estimated around the 0.1% handle. Annual growth is seen a little higher in 2025 (1.0%) vs 2024 (0.7%) and 2023 (0.4%), but momentum is uneven across sectors and the main countries.
- Labour Market: The Eurozone labour market continues to show some signs of cooling in recent months but remains overall resilient. Wage pressures continued to moderate recently.
- Monetary Policy: The ECB appears confident on being able to gradually cut its interest rates down to neutral territory with markets expecting 100bps of cuts in 2025.
PDF ANALYSIS HERE:
2025_Jan21_Eurozone_Macro_Signal.pdf
US TSYS/OVERNIGHT REPO: ON RRP Dips Below $100B For Just 3rd Time Since 2021
Takeup of the Fed's overnight reverse repo facility fell for the 4th session in 5 Tuesday, dropping $22B to the 2nd lowest level of the year so far and only the 3rd below $100B since April 2021.
- There may yet be another fresh low set this week amid large bill settlements, though levels aren't expected to dip too far below $100B.
