US TSYS: Bonds Firmer, Curves Flatter, Challenger Job Cuts Released Early
Oct-02 10:57
* Day two of US Government closure. Senate rejected a House Republican funding bill for the third ...
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US TSY FUTURES: BLOCK: Dec'25 2Y Buy
Sep-02 10:57
- +3,000 TUZ5 104-06.5, post time offer at 0635:42ET, DV01 $107,000.
- The 2Y contract trades 104-06.25 last
OUTLOOK: Price Signal Summary - GBPUSD Pierces Support
Sep-02 10:56
- In FX, despite today’s sell-off in EURUSD, the trend set-up remains bullish and weakness is considered corrective. Note that the pair has recently pierced key support around the 50-day EMA, currently at 1.1611. A clear break of the average would signal scope for a deeper retracement and potentially expose key medium-term support at 1.1392, Aug 1 low. Key resistance and the bull trigger is 1.1829, Jul 1 high. A breach would resume the primary uptrend.
- The outlook in GBPUSD remains bullish and recent gains reinforce this theme. However, today’s sell-off undermines the bull theme and attention is on key short-term support at 1.3391, the Aug 22 low. It has been pierced, a clear break of this level would signal scope for a deeper retracement and expose 1.3315, a Fibonacci retracement. For bulls, a breach of 1.3595, the Aug 14 high, is required to signal scope for a stronger rally.
- USDJPY is trading higher today but for now, remains inside its range. Resistance to watch is 148.78, the Aug 22 high. It has been pierced, a clear break of it would highlight a range breakout and a stronger bullish theme. This would also undermine the recent bear threat. A breach would open 149.12, 61.8% of Aug 1 - 14 bear leg. The bear trigger lies at 146.21, Aug 14 low. Clearance of this level would resume a downtrend that started in August.
US TSYS: Bear Steeper With ISM Mfg, Cook Case and Heavy Bill Supply Ahead
Sep-02 10:54
- Treasuries trade firmly bear steeper and are at session lows across major benchmarks with no paring of the moves as US desks filter in after Labor Day cash closures.
- Cash yields are 3.9-6.0bps higher from Friday’s close, with 2s lagging increases and 7s to 10s modestly leading them.
- Fresh ytd steeps were seen in Asia trading, 5s30s hitting 124.5bps (currently 123.1bps) as curves reflect recent European steepening but also Japan after latest political developments.
- TYZ5 has seen session lows of 112-02+, -13+ from Friday’s settle although with a slightly smaller drop from 112-11+ at yesterday’s early close.
- It moves closer to resistance at 111-31 (20-day EMA) after which lies 111-18+ (50-day EMA), with a pullback deemed corrective. Resistance meanwhile is seen at 112-20+ (Aug 28/29 high).
- Steepening impetus can also depend on any headlines potentially today from the Fed Gov. Cook court case. US District Judge Jia Cobb on Friday asked Cook’s lawyers to file a brief today spelling out their arguments for why Trump’s firing of Cook was unlawful. This is a case that seems likely to ultimately end up in the Supreme Court.
- We also get the ISM manufacturing report for August, after most regional Fed surveys saw improvements in new orders, and heavily than usual bill issuance in the holiday-shortened week.
- Data: S&P Global mfg PMI Aug final (0945ET), ISM mfg Aug (1000ET), Construction spending Jul (1000ET)
- Bill issuance: US Tsy $82B 13W & $73B 26W bill auctions (1130ET), US Tsy $85B 6W bills & $50B 52W bill auctions (1300ET)
- Politics: Trump makes an announcement – topic unknown (1400ET)
