Italian Bonds: New Down Trend Expected

Compared to other major European markets, the Italian Government Bonds (IGB) have been quite bearish over the past two/three years. The recovery in early 2017 has not really altered the general trend. Moreover, now that the recovery and ensuing consolidation has petered out, sellers should make a new push lower once support at 99.77 is taken out. Bearish pressure elsewhere should make this rather easy.

Clearing 99.77 triggers a sell signal targeting 95.21 followed by the major pivot-lows of 2017 at ~90.18. Interestingly, IGBs look considerably worse than Spain.

Primary trend: negative
Outlook: renewed down trend below 99.77
Strategy: hold-short and/or short-entry < 99.77
Support: 99.77 / 95.21* / 90.18-
Resistance: 101.60 / 103.10
Outlook cancelled/neutralized above 101.60