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Chart 82: German 10yr bund yield —- weekly chart Chart 83: Japanese 30yr yield - weekly chart 12.250 ii nt I 7 Wi | ! j ft Nw I afr, yf \ (ii 1 \W M {\ y Wri We | iV ly \ AN re ad Pores Ay ala | Wo ve eS Seee ess ATK A j----- 2008 2009 2010 2011 ole 2013 Source: BofA Merrill Lynch Global Research, Bloomberg 2014 2015 2016 =| 2017 2012 2013 2014 2015 Source: BofA Merrill Lynch Global Research, Bloomberg 2016 Buy NZD/USD 5m .69/.66 put spread 1x1.5 NZD/USD is forming a head and shoulders top. It is breaking trend line support from the January to June lows. It is also threatening to break the neckline at .7070. MACD recently crossed bearish and is trending toward negative. This pattern suggests NZD/USD will decline as low as .6615. Given the strong USD move in G10 thus far, we think NZD/USD is near an attractive technical level to position for further USD strength. We recommending buying a NZD/USD 5m .69/.66 put spread 1x1.5 for 43 USD pips (off of .7100 spot). Chart 84: NZD/USD daily chart 2017 |NZD-USD X-RATE - Last Pr... ISMAVG (50) on Close 0.7229 MSMAVG (200) on Close 0.7021 r0.7500 + 0.7400 -0.7300 0.7200 .7070 yeedtee ; +0.7000 hn ; a a 200d SMA 0.6900 ie oa 10.6800 Fi bo = — +0.6700 | ber ae ian fu + -6615 | 9.6600 N ly +0.6500 +0.6400 +0.6300 NzDUSD 0.01 MMACD(12,26) -0.0009 BSig(9) 0.0007) +0.005 B Diff yp -0,0016 ey +0.00 r-0.005 NZDUSD MIRSI 38.0882 C10B 70.00 “0S 30.00 go = - An-pA- es eae \ A , fr , Font ~ at hoa Wavat rr 60 * sal all \ eye 4 VA J ve Aaa MR acct fe ye we Pa cal \ es ft nie. hal “yO +40 (ote see eee ae, ptr uma i aa ea as RS tia a er ree atria Ret real ees ae eres Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2016 Source: BofA Merrill Lynch Global Research, Bloomberg 50 Global Rates, FX & EM 2017 Year Ahead | 16 November 2016 Bankof America Merrill Lynch HOUSE_OVERSIGHT_014780