The S&P 500’s percentage gains/losses from late 2002 to 2008 are strikingly similar to the magnitudes traced since the index’s 2009 low. As such, we are closely monitoring the lows of last week near 1100, which also coincide with retracement support; a break below this level would suggest that another wave of risk reduction is underway.
For the time being, while the JPY and CHF are not particularly benefiting in the latest bout of stock market weakness, the flood gates have opened elsewhere, and the SGD came under pressure. Medium-term resistance for USD/SGD is capping at 1.2280/2305, keeping the market rangebound. However, US 10y yields continue to trend strongly lower, and a decisive move through 2.00% opens longer-term targets at 1.58%.
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BARCLAYS CAPITAL
TECHNICAL RESEARCH