AUTOMOTIVE: Valeo: Results Out

• EUR/USD: Jan30 $1.0450-60(E1.0bln); Jan31 $1.0400(E1.7bln), $1.0450(E1.0bln), $1.0500(E1.4bln), $1.0520-30(E2.7bln); Feb03 $1.0400(E1.7bln)
• USD/JPY: Jan31 Y155.00($1.0bln)
• AUD/USD: Jan31 $0.6200-20(A$1.2bln)
• USD/CAD: Jan30 C$1.4490-00($1.2bln); Jan31 C$1.4400-20($1.2bln); Feb03 C$1.4400($1.5bln)

• RES 4: 110-25   High Dec 12
• RES 3: 110-19   76.4% retracement of the Dec 6  - Jan 13 bear leg.    
• RES 2: 109-31   High Dec 18  
• RES 1: 109-12+ 50-day EMA 
• PRICE:‌‌ 108-27+ @ 16:50 GMT Jan 28
• SUP 1: 108-00/107-06 Low Jan 16 / 13 and the bear trigger    
• SUP 2: 107-04   Low Apr 25 ‘24 and a key support  
• SUP 3: 107-00   Round number support
• SUP 4: 106-11   2.00 proj of the Oct 1 - 14 - 16 price swing  

The medium-term trend condition in Treasury futures is down, however a bullish short-term cycle highlights a corrective phase and the contract is holding on to its recent gains. Attention is on 109-12+, the 50-day EMA - a level tested on Monday. A clear break of this EMA would strengthen a bullish theme and open 109-31, the Dec 18 high. The bear trigger is 107-06, the Jan 13 low. Initial support has been defined at 108-00, the Jan 16 low.

• The 24 analysts we have reviewed in the table below unanimously expect a 25bp cut in policy rates on Thursday whilst the median sees a terminal 1.75% for the deposit rate.
• There’s a wide range of terminal rate expectations, from 1.00% to 2.25%, suggesting sizeable perceived risk that policy rates could shift below the current estimates of neutral which has a rough range of 1.75-2.5% across most Governing Council members.
• Note that this median of 1.75% is a close call with 2.0%, the figure found by the Bloomberg survey collated through January 10-16th.
• See the full MNI ECB Preview here.