US INFLATION: Analyst Expectations Of Key Sequential CPI Drivers

Tuesday's US rates/bond options flow included:

• TUK6 104.50/104.75 call spread vs. TUK6 103.75 puts 2K blocked at 0-00, buying the call spread and selling the puts
• SFRM6 96.50/96.62cs, traded 3.25 in 4k.
• SFRM6 96.43/96.50/96.56c fly, traded 0.25 in 1.5k.
• SFRM6 96.25/96.00ps 1x2, bought for 0 in 4k (on screen)
• SFRU6 96.75/96.87/96.93 broken c fly, traded 2.25 in 8k.
• SFRU6 9675/96.87cs vs 96.25/96.00ps, bought the cs for 1 in 10k.
• SFRZ6 98.00c, traded 5.5 in 2.5k.
• SFRZ6 96.75/96.87/97.00/97.12c condor, traded 1.75 in 3k.
• SFRZ6 95.81p, traded 2.5 in 6k.
• SFRZ6 96.50/96.25ps, sold at 8 in 4k
• 2QH6 96.81/96.62ps, traded 7 in 2k

Treasuries faded over the course of Tuesday's trade in another volatile session on the geopolitical/energy front.

• After a constructive start following through from Monday's comments by President Trump that the Iran conflict could soon be over, cash yields leaned higher throughout most of the remainder of the day.
• Early afternoon reports of oil tankers moving through the Strait of Hormuz (including one by the US Energy Secretary on X.com saying the US Navy had escorted one such tanker) helped oil take another leg lower.
• However these reports were quickly refuted (Energy Sec Wright deleted his post), with a CBS report on Iran potentially mining the Strait then seeing oil rebound sharply.
• That briefly bear steepened the curve with front Treasury futures touching session lows (112-10) before a modest bounce.
• Corporate supply kept a lid on Treasuries in general, highlighted by Amazon $Bmark 11-Part $37B offering and Salesforce reportedly planning to sell $25B as soon as this week.
• There was also some pressure at the short-end after the 3Y Note auction was one of the weakest in the last year, tailing 1.1bp (after having traded-through for the 6 consecutive auctions prior).
• On the day, the cash curve bear steepened slightly. Latest levels: 2-Yr yield is up 4.4bps at 3.5796%, 5-Yr is up 4bps at 3.7255%, 10-Yr is up 4.6bps at 4.1421%, and 30-Yr is up 6.2bps at 4.7754%.
• Jun 10-Yr futures (TY) up 0.5/32  at 112-12 (L: 112-10 / H: 112-24.5)
• Geopolitics will remain the ongoing focus for markets, but Wednesday's calendar highlight is February's CPI report - MNI's preview is Here. 

• RES 4: 160.00 Psychological round number
• RES 3: 159.45 High Jan 14 and the bull trigger
• RES 2: 159.23 High Jan 23
• RES 1: 158.90 High Mar 9
• PRICE: 157.65 @ 16:24 GMT Mar 10  
• SUP 1: 155.86/154.00 50-day EMA / Low Feb 23
• SUP 2: 152.72 Trendline support drawn from the Apr 22 ‘25 low
• SUP 3: 152.10 Low Jan 27 and a bear trigger
• SUP 4: 151.54 Low Oct 29 ‘25

The current bull cycle in USDJPY remains intact and Monday’s fresh cycle high reinforces current conditions. Price continues to trade above the 50-day EMA that was recently breached. That break highlights a stronger reversal. Note too that resistance at 157.76, the Feb 9 high, has been cleared. The clear breach of this level opens 159.45, the Jan 14 high and a key hurdle for bulls. Initial firm support lies at 155.86, the 50-day EMA.