HALISTER1: Italy Bond Futures’ Uptrend Break Sets in Motion Deeper Setback

Italy Bond Futures’ Uptrend Break Sets in Motion Deeper Setback

(Bloomberg) -- BTP generic contract may see opportunistic sellers step in after momentum rolls over and market erodes the bullish trendline from mid-March, Bloomberg technical analyst Sejul Gokal writes.
  • See chart; IKM7 -45 ticks to 132.70
  • While broader trend upholds its bullish structure (market above daily cloud), near-term outlook deteriorates further after Wednesday’s break below the 11-week uptrendline and Thursday’s follow-through selling
  • Momentum flagging, with daily MACD breaking its fast uptrendline while negative histogram hits multi-week lows
  • Potential support objectives at 131.56-42 (38.2% Fibonacci, 55-DMA) and 130.80-78 (50% retracement, 100-DMA)
    • Close above 133.48 negates downside view
  • Investors have recently dumped Italian stocks and debt after ruling Democratic Party leader Matteo Renzi signaled the possibility of a vote in September or October, more than six months ahead of schedule
  • NOTE: Sejul Gokal is a technical strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.

Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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