Category: EU

  • DAX 40 Crosses 25,000 as Wage Pressures Stabilise – Thursday, 18 June

    Snapshot: The DAX 40 has cleared the psychological 25,000 milestone, underpinned by the ECB’s latest wage tracker confirming stable wage pressures and cementing Germany’s HICP at the 2.0% target. This domestic disinflation narrative has been amplified by a -4.48% plunge in WTI crude to $84.65 following the US-Iran interim shipping agreement, offering immense relief to energy-sensitive heavy industrials like Siemens and tech leaders like Infineon, which surged over 4%.

    • Key Level: Structural support now rests at 24,900; the index’s sixth successive session of gains is fundamentally validated by domestic inflation cooling to 2% (down from 2.6% prior) and stable negotiated wages.
    • NY Session Risk: Watch the impending US 08:30 ET data releases; any hot print will embolden Fed Chair Warsh’s hawkish stance, potentially pushing the US 10-year yield back above 4.43% and triggering late-session profit-taking.

    Bias into NY: We maintain a constructive bias targeting 25,150, as the structural tailwind of anchored Eurozone wage pressures and collapsed energy input costs insulates the German index from hawkish Fed repricing.

  • Clean EUR Positioning Limits Downside Ahead of US Data – Thursday, 18 June

    Where we are: EUR/USD has slipped below the pivotal $1.1500 handle, currently trading near $1.1485 as London handing over to New York. The pair has spent the morning session grinding lower within a tight overnight range of $1.1475 to $1.1510, pressing against key multi-month support. We are trading well below yesterday’s North American close, with the immediate technical picture looking heavy but highly stretched. A failure to reclaim $1.1520 by the NY close leaves the door open to a test of the $1.1450 structural support zone.

    What’s driving it: The European Central Bank’s newly released wage tracker pointing to stable negotiated wage pressures in 2026 has cemented the central bank’s meeting-by-meeting easing bias, keeping a follow-up rate cut firmly on the table. This domestic wage moderation, alongside core HICP sitting at a manageable 2.3%, validates the ECB’s 25bp cut in April to 2.50% and limits any scope for a hawkish repricing of the Eurozone curve. External cross-currents, including a hawkish Fed projection and WTI crude’s precipitous drop to $84.65 on a potential US-Iran agreement in the Strait of Hormuz, are reinforcing this downward pressure by dampening regional inflation expectations. Structural corporate headwinds are also mounting, as BMW’s warnings on Chinese competition and foreign investor pushback on EU regulations weigh on the single currency’s broader investment appeal.

    • ECB Wage Tracker: The latest data confirms negotiated wage pressures are stabilizing in 2026, giving the ECB’s dovish faction the green light to press for sequential cuts if services HICP moderates.
    • Geopolitical Energy Decompression: The plunge in WTI crude to $84.65 on US-Iran headlines directly curbs Eurozone headline inflation risks, reinforcing the ECB’s capacity to ease policy ahead of the Fed.
    • Clean Speculative Positioning: CFTC positioning data reveals a severe capitulation, with net non-commercial longs slashed by 34,934 contracts to just +13,932; at the 6th percentile of the 52-week range, the market is structurally underweight the single currency, leaving it highly vulnerable to a short-covering squeeze.

    NY session focus: All eyes are on the 08:30 ET US macro data, specifically the Philly Fed Manufacturing Index (forecasted at 9.8) and Unemployment Claims (expected at 225K). A softer-than-expected claims print or a Philly Fed miss will quickly expose the clean positioning in EUR/USD, sparking an immediate squeeze back toward $1.1540. While the trend-following trade of selling intraday rallies up to $1.1510 has paid off this week, running short positions into these levels is increasingly risky given the washed-out speculative backing. The pain trade for the session is a swift, short-covering rally that takes out the $1.1550 level and stops out late-stage momentum sellers.

  • EURJPY Heavy as Stable Wages Support ECB Cuts – Thursday, 18 June

    Snapshot: EUR/JPY is trading with a heavy bias as yesterday’s stable Eurozone wage tracker reinforces the ECB’s mild easing path from its current 2.50% deposit rate. This domestic softness stands in contrast to a Bank of Japan biased toward slow normalisation, with the broader downside on the cross further amplified by a steady retreat in US 10-year yields to 4.43%.

    • Yesterday’s stable negotiated wage data gives ECB doves the ammunition they need to push for consecutive rate cuts later this year, keeping Euro upside structurally capped near recent cycle highs.
    • Extreme Yen weakness past prior intervention zones dramatically raises the threat of unilateral MoF/BoJ policy action, making long EUR/JPY positioning highly asymmetric and vulnerable to a sharp squeeze ahead of the US 08:30 ET data.

    Bias into NY: We hold a tactical bearish bias into the New York session, looking for a break below 169.20 toward 168.50, as cooling Eurozone wage dynamics and Japanese intervention fears prompt a timely liquidation of stretched carry longs.

  • EUR/GBP Falls on Hawkish BoE Hold – Thursday, 18 June

    Snapshot: EUR/GBP is trading lower today, testing key downside levels after the Bank of England held its Bank Rate at 3.75% at 12:00 BST. The MPC’s decision to maintain rates, backed by a sticky core CPI print of 2.6%, contrasts sharply with the ECB’s active 2.50% easing cycle. Resilient UK wage growth of 4.0% from this morning’s 07:00 BST print further cements sterling’s yield advantage over the euro.

    • The BoE’s 1-0-8 vote split reinforces a high bar for UK rate cuts, keeping the gilt-bund yield differential wide and capping any EUR/GBP corrective rallies.
    • Monitor the US 08:30 ET macro prints for broader USD-driven volatility, though the cross remains fundamentally anchored by European monetary policy divergence.

    Bias into NY: Bearish EUR/GBP. The structural policy divergence favours sterling strength, and we expect sellers to target the 0.8420 level as US desks digest the hawkish BoE holding pattern.

  • Single Currency Pins Below 1.15 as Positioning Clears – Thursday, 18 June

    Where we are: The Single Currency is hovering near the 1.1475 level ahead of the New York open, consolidating just below the psychological 1.1500 handle. The overnight range has been tight, bound between 1.1460 and 1.1490, as London cash trading struggles to establish a firm directional bias. This leaves EURUSD trading slightly down from yesterday’s New York close, pinned near its lowest levels since late March. Key support at 1.1450 remains the immediate structural target for bears, while a break back above 1.1520 is required to neutralize the near-term downside pressure.

    What’s driving it: Eurozone domestic dynamics are quietly reinforcing the European Central Bank’s mild easing bias, removing any immediate domestic trigger for a yield-driven recovery. Yesterday’s ECB wage tracker data pointed to stable negotiated wage pressures for 2026, which gives the Frankfurt doves solid ground to argue for eventual follow-up cuts from the current 2.50% Deposit Facility Rate. This soft wage picture, combined with HICP at 2.0% and Core at 2.3%, leaves the Euro highly vulnerable to external yield differentials as domestic rates offer little protection. While the steep decline in WTI crude to $84.65 per barrel helps cap regional inflation expectations, it also strips away any energy-driven bid for the currency.

    • The ECB’s latest wage tracker indicates negotiated wage growth is stabilizing, validating the doves’ base case for policy normalization following April’s 25bp cut to 2.50%.
    • Geopolitical frictions are creeping into the peripheral wire, with U.S. Defense Secretary Hegseth launching a six-month review of the U.S. military footprint in Europe while scolding NATO allies.
    • Speculative positioning has undergone a massive liquidation, with CFTC net non-commercial longs collapsing by 34,934 contracts in a single week to just 13,932 (the 6th percentile of its 52-week range), leaving the market structurally clean and highly vulnerable to a short-covering squeeze on any US data miss.

    NY session focus: All eyes now shift to the 08:30 ET U.S. data double-header, where the Philly Fed Manufacturing Index (forecasted at 9.8) and weekly Unemployment Claims (expected at 225k) will dictate whether the dollar’s yield advantage continues to widen. We expect 1.1450 to act as major structural support; a hawkish U.S. print that pushes EURUSD through this level will open the gates toward 1.1400. Conversely, selling EURUSD on any initial rally toward 1.1510 remains the preferred desk strategy while the domestic growth outlook lags. The ultimate pain trade is a soft U.S. claims print triggering a rapid short-covering squeeze back through 1.1550, given how aggressively real money has cleared out its Euro exposure.

  • DAX 40 Crosses 25,000 on Stable ECB Wage Outlook – Thursday, 18 June

    Snapshot: The DAX 40 has broken above the pivotal 25,000 mark to print fresh highs, supported by domestic disinflation confirmation as the ECB wage tracker points to stable negotiated wage pressures. German HICP holding at 2% YoY provides a clear runway for ECB policy normalization, while this constructive domestic backdrop is further amplified by a 4.5% slide in WTI crude to $84.65 following progress on a Middle East ceasefire.

    • Key Signal: The clean daily break above the 25,000 handle signals structural bullish continuation, with local support now established at the 24,950 breakout zone and leadership driven by Infineon and Siemens.
    • NY Session Risk: US macro prints at 08:30 ET present headline risk, but the domestic narrative is insulated by institutional inflows as desks act on JPMorgan’s call to buy lagging European cyclicals.

    Bias into NY: We are buyers of intraday dips targeting 25,180. The domestic reality of anchored 2% Eurozone inflation and stable wages keeps the ECB on a path of gradual easing, keeping DAX risk premium low regardless of any near-term Fed hawkishness.

  • Euro/Yen Caps as Stable Eurozone Wages Anchor ECB Easing – Thursday, 18 June

    Snapshot: Euro/Yen remains heavy as yesterday’s ECB wage tracker confirmed stable negotiated wage pressures for 2026, cementing the central bank’s mild easing bias. This domestic softening contrasts with a Bank of Japan aiming for slow policy normalisation from 0.50%, leaving the cross exposed to downside momentum ahead of the New York open.

    • Policy Divergence: The ECB wage tracker validates the doves’ case for follow-up cuts to the 2.50% Deposit Rate, systematically stripping hawkish premium out of the Euro.
    • Intervention Risk: With the Yen trading near critical intervention zones, any sudden spike in the VIX (currently 16.41) or a deterioration in broader risk appetite during the NY session at 08:30 ET will likely trigger sharp short-covering in the JPY.

    Bias into NY: We hold a short bias on Euro/Yen targeting a move toward 168.20, as the ECB’s soft wage data leaves the single currency structurally vulnerable while MoF intervention threats cap any JPY weakness.

  • Euro/Sterling Slips After BoE Holds Rates – Thursday, 18 June

    Snapshot: EUR/GBP is trading heavily near 0.8420, down 0.3% on the day, following the Bank of England’s decision at 12:00 BST to maintain the Bank Rate at 3.75%. While the ECB retains a mild easing bias following its April cut to 2.50%, the MPC’s cautious, data-dependent hold—underpinned by resilient UK core CPI rising to 2.6% in May—keeps Sterling firmly on the front foot.

    • The immediate focus shifts to EUR/GBP support at 0.8400; a clean break exposes 0.8350, especially as the BoE’s 8-1 vote split confirms that the committee remains highly reluctant to ease policy while services CPI hovers near 5%.
    • Squeeze risk is low, but traders must watch the 08:30 ET US data slate for secondary dollar volatility, which could temporarily disrupt the cross’s downward trajectory if global bond yields swing.

    Bias into NY: Bias remains firmly bearish into the New York open, targeting 0.8385, as the stark policy divergence between a cutting ECB and a restrictive BoE caps any corrective rallies at 0.8455.

  • NY Session Tactical Brief – Thursday, 18 June

    Regime: Highly risk-on as global equity futures rally sharply, supported by a plunge in energy prices and a stable VIX at 16.41, which offsets yesterday’s hawkish FOMC debut by Governor Warsh.

    Today’s market themes:

    • Geopolitical de-escalation as the landmark US-Iran Strait of Hormuz agreement triggers a major crude supply shock.
    • Central bank divergence following the Bank of England’s 7-2 hold at 3.75% and the Swiss National Bank’s steady 0.00% pause.
    • Global equity outperformance led by energy-importing jurisdictions as input costs collapse.

    The setup: The landmark interim agreement to reopen the Strait of Hormuz has completely shifted the near-term macro landscape, sending Brent crude crashing below $78/bbl and driving a massive relief rally in global equities. US Nasdaq futures are up 2.0% as the market completely shrugs off hawkish Fed debutant Warsh, while the US Dollar Index holds firm at 100.60. We lean long high-beta equities and short oil, utilizing the capitulating Yen as the preferred funding leg for cross-asset carry play.

    Watch list (native time per event):

    • 07:00 BST: GBP Claimant Count Change (forecast 25.8K, prior 26.5K)
    • 09:30 CET: CHF SNB Policy Rate (forecast 0.00%, actual 0.00%)
    • 12:00 BST: GBP BoE Official Bank Rate (forecast 3.75%, actual 3.75%, voted 7-2)

    Bias by asset:

    • DXY:
      • Direction: Bullish bias
      • Domestic (US): Hawkish Fed transition under Governor Warsh and elevated yields support greenback.
      • Cross: Supported by safe-haven unwinds in European currencies and weaker commodity complexes.
      • Levels: Support 100.20 / Resistance 101.00
    • EUR/USD:
      • Direction: Bearish bias
      • Domestic (EU): Stable negotiated wage growth dampens ECB urgency for rapid interest rate cuts.
      • Cross: Stronger DXY and widening US-DE 10Y yield spread keep spot capped.
      • Levels: Support 1.1420 / Resistance 1.1500
    • GBP/USD (Cable):
      • Direction: Bearish bias
      • Domestic (UK): BoE votes 7-2 to hold rates at 3.75% with dovish dissent.
      • Cross: DXY strength and widening US-UK yield differential force spot below 1.3200.
      • Levels: Support 1.3150 / Resistance 1.3250
    • USD/JPY:
      • Direction: Bullish bias
      • Domestic (JP): Ultra-low JGB yields and lack of BoJ intervention drive yen capitulation.
      • Cross: US 10Y yield at 4.43% and firm DXY accelerate spot breakout.
      • Levels: Support 158.50 / Resistance 161.00
    • USD/CAD (Loonie):
      • Direction: Bullish bias
      • Domestic (CA): Softening domestic inflation expectations bolster Bank of Canada rate cut pricing.
      • Cross: Plunging crude prices and firm DXY push spot to seven-month highs.
      • Levels: Support 1.4020 / Resistance 1.4150
    • AUD/USD (Aussie):
      • Direction: Bullish bias
      • Domestic (AU): RBA maintains hawkish bias due to sticky domestic services CPI inflation.
      • Cross: Risk-on sentiment and steady Chinese growth proxies offset broad DXY strength.
      • Levels: Support 0.6960 / Resistance 0.7050
    • NZD/USD (Kiwi):
      • Direction: Bearish bias
      • Domestic (NZ): RBNZ maintains clear easing bias following April’s 25bp rate cut.
      • Cross: Underperforming Aussie on cross-play while DXY pressure keeps upside capped.
      • Levels: Support 0.5730 / Resistance 0.5820
    • USD/CHF (Swissy):
      • Direction: Neutral bias
      • Domestic (CH): SNB holds policy rate steady at 0.00% matching market expectations.
      • Cross: DXY consolidation and safe-haven outflow unwind limit CHF recovery.
      • Levels: Support 0.8750 / Resistance 0.8850
    • EUR/GBP, EUR/JPY, GBP/JPY:
      • Direction (per cross): Bearish EUR/GBP, Bullish EUR/JPY, Bullish GBP/JPY
      • Domestic: BoE 7-2 hold outweighs stable ECB wage data and ultra-dovish BoJ.
      • Cross: Risk-on sentiment fuels yen-cross upside, overriding nominal DXY consolidation.
      • Levels: EUR/GBP 0.8400 / EUR/JPY 171.00 / GBP/JPY 225.00
    • XAU (Gold):
      • Direction: Bullish bias
      • Domestic (asset-specific): Falling global real yields and central bank purchases provide fundamental support.
      • Cross: De-escalation flows cap gains as safe-haven premium unwinds into DXY.
      • Levels: Support $4,280 / Resistance $4,350
    • XAG (Silver):
      • Direction: Bullish bias
      • Domestic (asset-specific): Industrial demand expectations recover on global manufacturing and energy cost relief.
      • Cross: Gold-silver ratio compresses as high-beta silver outperforms under risk-on DXY.
      • Levels: Support $29.50 / Resistance $31.20
    • WTI / Brent:
      • Direction: Bearish bias
      • Domestic (asset-specific): Strait of Hormuz reopening releases massive physical oil supply to market.
      • Cross: Risk-on equity bounce fails to offset deep sector-specific liquidation.
      • Levels: Brent Support $75.00 / WTI Support $72.50
    • Copper:
      • Direction: Bearish bias
      • Domestic (asset-specific): Soft physical demand in China and rising warehouse stocks weigh.
      • Cross: Stronger DXY and post-FOMC real rate pricing pressure global growth proxies.
      • Levels: Support $4.35 / Resistance $4.55
    • SPX:
      • Direction: Bullish bias
      • Domestic (US): Hawkish Fed digested as corporate earnings bid provides cushion.
      • Cross: VIX steady at 16.41 while global risk-on flow supports futures.
      • Levels: Futures 5,450 / Cash Resistance 5,500
    • NDX:
      • Direction: Bullish bias
      • Domestic (US): Mega-cap tech earnings power strong bid despite Warsh’s hawkish tone.
      • Cross: Erasing post-FOMC decline as high-beta flows return; VIX stays subdued.
      • Levels: Futures 19,800 / Resistance 20,100
    • US30 (Dow):
      • Direction: Bullish bias
      • Domestic (US): Cyclical stocks benefit from lower energy costs boosting operating margins.
      • Cross: Stabilizing 10Y yields at 4.43% encourage rotation back into industrials.
      • Levels: Futures 39,100 / Resistance 39,500
    • UK100 (FTSE):
      • Direction: Bearish bias
      • Domestic (UK): High concentration of oil supermajors drags index on crude plunge.
      • Cross: Underperforming European peers due to commodity slump and firmer Gilt yields.
      • Levels: Support 8,100 / Resistance 8,250
    • DAX:
      • Direction: Bullish bias
      • Domestic (DE): Clear of 25,000 handle on highly constructive domestic inflation outlook.
      • Cross: Energy cost relief boosts European manufacturing sentiment, lifting cyclical equities.
      • Levels: Support 24,900 / Resistance 25,250
    • Nikkei:
      • Direction: Bullish bias
      • Domestic (JP): Plunging import energy costs trigger massive relief rally for corporate Japan.
      • Cross: Ultra-weak Yen and global risk-on push index to record 71,053.
      • Levels: Support 70,000 / Resistance 71,500
    • BTC:
      • Direction: Bearish bias
      • Domestic (asset-specific): Sluggish ETF inflows and rising spot liquidations cap upside momentum.
      • Cross: Fails to participate in equity risk-on as DXY remains elevated.
      • Levels: Support $65,500 / Resistance $67,500

    Positioning watch: Speculator positions in the US Dollar (81st percentile long), Copper (92nd percentile long), and Bitcoin (98st percentile long) face extreme liquidation risk if US yields turn. Conversely, the heavily shorted Japanese Yen (0th percentile) and S&P 500 (6th percentile) are highly primed for aggressive short-squeezes.

    The pain trade: An unexpected, sharp downward break in the US Dollar Index that triggers a violent, coordinate short-squeeze across the massive speculator net-short positions in the Japanese Yen and Sterling.

  • DAX 40 Breaks 25,000 on Easing Wage Pressures – Thursday, 18 June

    Snapshot: The DAX 40 has cleared the 25,000 milestone for the first time since early June, driven by stabilizing negotiated wage pressures that pave the way for a supportive ECB. Yesterday’s ECB wage tracker and the drop in German HICP to 2% have solidified the domestic disinflation narrative. This provides a robust foundation for equities, which is further amplified by a 4.5% plunge in WTI crude to $84.65 following an interim US-Iran ceasefire agreement.

    • Germany’s industrial champions are leading the charge, with Siemens Energy up 2.2% and Infineon rallying over 4.0% as falling input costs and stable eurozone yields support expansion.
    • US macro prints at 08:30 ET represent the primary risk to the session, where any hawkish inflation indicators could halt the cross-asset risk bid.

    Bias into NY: We are buyers of the German index above 24,950, targeting a run toward 25,150 into the NY cash open as the combination of cooling domestic wage growth and cheaper energy feeds the European industrial recovery.

  • Washed-Out Euro Positioning Ripe for Squeeze – Thursday, 18 June

    Where we are: EUR/USD is currently consolidating around the 1.1475 level, pausing just beneath the key psychological 1.1500 mark after recently probing its lowest levels since late March. The overnight session saw the single currency locked in a tight 1.1460 to 1.1495 range, with the European cash open failing to spark a breakout. We are holding near the upper boundary of this intraday bracket as the desk prepares for the influx of New York liquidity.

    What’s driving it: The Eurozone wage tracker data released yesterday has anchored domestic interest rate expectations, showing stable negotiated wage pressures that keep the ECB’s mild easing bias firmly data-dependent and meeting-by-meeting. Core HICP remaining sticky at 2.3% continues to justify the Governing Council’s reluctance to signal back-to-back cuts, preventing a deeper breakdown in domestic yields. This hawkish undertone is acting as a buffer against geopolitical headwind headlines, including the Pentagon’s abrupt review of US military presence in Europe and BMW’s warnings on Chinese tariff retaliation. This domestic holding pattern is playing out alongside a sharp 4.48% drop in crude oil to $84.65, which caps near-term European inflation expectations while supporting the broader terms-of-trade profile.

    • The ECB wage tracker points to stable negotiated wage pressures in 2026, providing the hawkish faction on the GC with plenty of dry powder to resist a rate cut at the next meeting.
    • Speculator positioning has capitulated to the 6th percentile of its 52-week range, with net non-commercial contracts slashed by 34,934 to just +13,932, leaving the market highly vulnerable to a short-squeeze.
    • Sovereign yield spreads remain relatively contained, though European equity markets are attracting contrarian flows following JPMorgan’s call to buy European stocks despite rising regulatory scrutiny from foreign investors like Saudi Arabia’s PIF.

    NY session focus: The immediate catalysts are the 08:30 ET US macro releases, with the Philly Fed Manufacturing Index (forecast 9.8) and Unemployment Claims (forecast 225K) set to dictate the dollar’s momentum. A weak claims print will likely trigger an immediate short-covering squeeze in the single currency back toward 1.1520, whereas an upside surprise on the manufacturing survey will test key support at the 1.1420 year-to-date lows. The tactical setup favors buying shallow dips toward 1.1450 with tight stops, as the heavily cleared positioning slate makes chasing the downside highly risky. The ultimate pain trade is a rapid squeeze back through 1.1560 that catches structural shorts off guard.

  • EUR/JPY: Guppy Range-Bound as Stable Eurozone Wages Anchor ECB – Thursday, 18 June

    Snapshot: EUR/JPY remains heavily anchored as yesterday’s ECB wage tracker confirmed stable negotiated wage pressures, reinforcing the central bank’s cautious easing bias following April’s 25bp cut to 2.50%. This domestic wage print dampens immediate Euro upside, while the Yen is supported on the margins by the Bank of Japan’s slow-but-steady normalization bias at 0.50%. The cross lacks a clear directional catalyst as a result, with both central banks in wait-and-see modes.

    • Negotiated wage stability in the Eurozone cements the ECB’s meeting-by-meeting flexibility, capping EUR/JPY upside as the doves build their case for another rate cut if services HICP cools.
    • Verbal intervention risk from the MoF and BoJ remains high, meaning any speculative push to new lows in the Yen will face stiff official resistance.

    Bias into NY: We lean slightly bearish on the cross today, looking for a drift toward 168.20 as US 10-year real yields drop 1.0bp to 2.14%, dragging the USD broad index down 0.51% and offering the Yen some passive cross-driven support.

  • EUR/GBP Bears Charge on Hawkish BoE Hold – Thursday, 18 June

    Snapshot: EUR/GBP is trading heavily near the 0.8410 level, down 35 pips on the session, as the Bank of England’s decision to maintain Bank Rate at 3.75% reinforces Sterling’s yield advantage. Today’s hold, coupled with core CPI ticking up to 2.6% in the May print, cements a cautious MPC that contrasts sharply with the ECB’s active easing cycle.

    • Strong UK earnings growth at 4.0% and sticky core inflation keep BoE rate-cut expectations firmly at bay, opening a path for a test of the key support level at 0.8380.
    • The primary risk heading into the New York session is spillover from US macro data at 08:30 ET, where a softer US print could trigger broad USD selling, compounding EUR/GBP downside through cross-rate flows.

    Bias into NY: We are structural sellers of Euro/Sterling on rallies, targeting a break below 0.8380. The widening policy divergence between a stationary BoE and an easing ECB remains the dominant force, with any USD-driven volatility offering a better entry point.

  • DAX 40 Crosses 25,000 as ECB Wage Pressures Stabilize – Thursday, 18 June

    Snapshot: The DAX 40 has cleared the key 25,000 handle to trade at multi-week highs, supported by a highly constructive domestic inflation outlook. Yesterday’s ECB wage tracker confirmed negotiated wage pressures are stabilizing in 2026, consolidating the disinflation trend alongside Germany’s HICP at 2%. This supportive domestic backdrop is amplified by a 4.5% slide in WTI crude to $84.65, which has supercharged industrial and tech heavyweights like Siemens and Infineon.

    • The structural breakout above 25,000 is reinforced by institutional inflows as global desks capitulate on underweight Europe stances, leaving 24,850 as firm short-term support.
    • Watch the upcoming US 08:30 ET data block; any upside pressure on US Treasury yields could briefly cap the interest-sensitive tech components that have led this six-day rally.

    Bias into NY: We are structurally long targeting 25,180 into the New York open, with the combination of cooling German inflation and collapsing energy input costs keeping the path of least resistance firmly higher.

  • EUR/JPY Climbs on Stable Eurozone Wage Tracker – Thursday, 18 June

    Snapshot: EUR/JPY is grinding higher toward the 170.50 level as yesterday’s stable Eurozone negotiated wage tracker dampens expectations for rapid ECB rate cuts. This domestic wage resilience protects the Euro’s yield advantage against a fragile Yen, even as a sharp 4.48% drop in WTI crude oil provides a minor terms-of-trade buffer for JPY.

    • Yesterday’s ECB wage tracker confirms stable negotiated wage pressures for 2026, giving the governing council’s hawks ample ammunition to oppose consecutive rate cuts and keeping the euro-zone yield curve supported.
    • Japanese Ministry of Finance intervention risk remains the primary near-term threat, as extreme Yen weakness past prior intervention zones raises the probability of sudden verbal or physical MoF action during the NY session.

    Bias into NY: We lean long EUR/JPY toward 171.20, using 169.80 as a tactical pivot. The Euro’s fundamental floor is well-defined by the sticky domestic wage outlook, while the Yen lacks the Bank of Japan rate momentum to drive any organic recovery.