GILTS: Back From Highs After Futures Close Gap, Labour Market Data Eyed

"IRAN'S STATE TV SAYS IT IS BEING ATTACKED BY ISRAEL" - Reuters

• Reports that Iran is seeking to de-escalate hostilities with Israel and resume talks with the US has buoyed risk sentiment and weighed on gold. Spot is down almost 1% today, trading back towards to $3,400 handle.  A bullish theme nonetheless remains intact, with initial support seen at $3,335/5 (20-day EMA).
• The May 7 high at $3,435.6 was pierced on Friday. A clear break of this level would strengthen the uptrend and open the all-time Apr 22 high of $3,500.1.
• It’s worth highlighting that other precious metals (e.g. silver and palladium) did not benefit from haven demand during the Middle East escalates, cementing gold’s position as the asset of choice when geopolitical risk ratchets higher.
• Positioning changes in the week to June 10 were limited, according to CFTC data, with total non-commercial net longs remaining just below 190k contracts.

• Treasuries extending session highs along with equities in the last few minutes, risk on - or more like unwinding risk-off positioning from late last week as markets react positively to Iran headlines. Iran hoping intermediaries will pressure Israel to an immediate ceasefire in return for "flexibility in nuclear negotiations" with the US.
• Treasuries are still well off early Friday levels, Sep'25 10Y contract trades 110-25 high (+5.5) vs. 110-26 overnight high - compares to early Friday high of 111-05 (111-13 overnight high).
• Focus on key resistance and recent high at 111-14+, a Fibonacci retracement and the Jun 5 high. Clearance of this hurdle would be bullish and highlight a stronger reversal.
• Stocks taking headlines more positively, SPX eminis rising to the highest levels since last Wednesday: taps 6055.25 recently (+76.0) with Financials and IT sectors leading gainers in early trade.
• Despite the breadth of moves, markets rather quiet ahead of Wednesday's FOMC annc. Projected rate cut pricing cooling vs. late Friday levels (*) as follows: Jun'25 at 0.0bp, Jul'25 at -4.1bp (-5.9bp), Sep'25 at -18.4bp (-22.4bp), Oct'25 at -34.9bp (-32.1bp), Dec'25 at -46.9bp (-50.5bp).
• Busy Wednesday: addition to FOMC, markets see weekly/continuing claims, house starts/build permits & 3 bill auctions ahead Thursday's Juneteenth holiday. Cash Treasury and stock exchanges are closed Thursday, along with open outcry pits in Chicago but equity and debt futures will be open for an abbreviated trading session.