BUNDS: US FOMC is the forefront Today

• While the liquidity in US Treasuries has been on the lower side, given the US President's Day Holiday, Volumes in Bund, do stand out for an overnight session and the contract remains close to the next are of interest, the 2.50% Yield level, this equated to 131.97 on Friday.
• Immediate support remains at that area, and resistance moves down to 132.73, although better will be seen towards the 133.00 figure.
• This is a much lighter Week on the Data front, UK Employment and CPI are the main focus on this side of the Pond, while Friday sees Global PMIs, the main event for the Week.
• Bond Desks will also start to look into rolling their Position into the June Expiry towards the end of the Week and especially next Week, with 1st Notice for Gilt and Treasuries on the 27th, and 28th February respectively.
• SPEAKERS: ECB Nagel, Fed Harker, Bowman, Waller.

The six forecasts submitted to BBG for the January SA unemployment rate were 8.5/8.6%, so that's a decent upside surprise (9.7% actual vs 8.6% prior).

• Very modest initial moves in FX (EURSEK up 0.05%; NOKSEK now little changed), but morning datapoints can set the tone for the session ahead.
• Note that the labour force survey can be volatile month to month. We will provide further details in due course.

• RES 4: 123.34 High Dec 11      
• RES 3: 122.85 High Dec 12 
• RES 2: 121.88 76.4% retracement of the Dec 11 - Jan 13 bear leg 
• RES 1: 120.98/121.00 61.8% of Dec 11 - Jan 13 bear leg / High Feb 7   
• PRICE: 120.17 @ Close Feb 14
• SUP 1: 119.65 Low Feb 12          
• SUP 2: 118.65/117.16 Low Jan 24 / 13 and the bear trigger
• SUP 3: 116.59 76.4% retrace of the Jun - Dec ‘24 bull cycle (cont)
• SUP 4: 116.07 Low Jul 8 ‘24 (cont)    

A bullish cycle in BTP futures remains intact and the latest pullback appears corrective - for now. Price has recently traded above both the 20- and 50- day EMAs. This signals scope for an extension of the upleg and sights are on 120.98 (pierced) and 121.88, Fibonacci retracement points. On the downside, initial key support to watch lies at 118.65, the Jan 24 low. Clearance of this price point would highlight a reversal and the end of the corrective bull cycle.