EMISSIONS: UKA ICE Auction Clears At £43.25/ton CO2e

• RES 4: 134.54 61.8% retracement of the Dec 2 - Jan 14 bear leg           
• RES 3: 134.06 High Dec 23 ‘24  
• RES 2: 133.46/71 High Feb 28 / 5 and a reversal trigger
• RES 1: 132.94 Intraday high               
• PRICE: 131.97 @ 12:47 GMT Mar 3 
• SUP 1: 131.83 Low Feb 24  
• SUP 2: 131.26 Low Feb 19 and a bear trigger            
• SUP 3: 131.00 Low Jan 24 and a key short-term support
• SUP 4: 130.28 Low Jan 15 and the bear trigger   

Bund futures have pulled back from their recent highs and the contract is trading sharply lower today. The move down undermines a recent bullish theme. A continuation lower would expose the next important support at 131.26, the Feb 19 low. Clearance of this level would be viewed as an important short-term technical break. Two important resistance points remain intact for now; 133.46, the Feb 28 high, and 133.71, the Feb 5 high

Tesoro Publico has announced it will be looking forward to sell a combined E4.5-5.5bln of the following Oblis at its auction this Thursday, March 6:

• the 3.10% Jul-31 Obli (ISIN: ES0000012N43)
• the 3.15% Apr-35 Obli (ISIN: ES0000012O67)

Additionally, Tesoro Publico has announced it will be looking to sell E0.25-0.75bln of the 0.70% Nov-33 Obli-Ei (ISIN: ES0000012C12) at that auction.

Tesoro Publico has also announced it will be looking forward to sell a combined E5.5-6.5bln of the following letras at its auction tomorrow, March 4:

• the 6-month Sep 5, 2025 letras
• the new 12-month Mar 6, 2026 letras

Greenback move is extending well into US hours here, with the USD Index posting another session low at the crossover. The USD Index needs further slippage of ~0.6% to challenge the key support at the Feb24 low of 106.126, meaning we'd have to be testing ~1.0550 in EUR/USD before those levels can be considered.

• Volumes are impressive, and particularly healthy for a Monday. While the Eurozone HICP release certainly helped lift activity, volumes have been pretty consistent throughout the day, helping EUR futures post volumes of over 50% ahead of average for this time of day.
• Perhaps tellingly, the USD pressure is less evident against the MXN, CAD and CNH - all of which remain in the crosshairs for additional tariffs at 0501GMT/0001ET on Tuesday - although elevated overnight implied vols for all three currencies suggest markets are still wary of the risk of a last minute reprieve - however markets will certainly be aware of the proximity to tomorrow's State of the Union, at which Trump addresses a joint session of Congress, in a speech that will almost certainly address tariff and trade policy.