US NATGAS: EIA STORAGE RELEASE @ 1PM ET

• +18,000 SFRU5 96.12/96.50 call spds, 4.0 ref 95.935 at 1147:24ET

• RES 4: 112-23+ 1.618 proj of the Jan 13 - Feb 7 - Feb 12 price swing
• RES 3: 112-13   1.500 proj of the Jan 13 - Feb 7 - Feb 12 price swing
• RES 2: 112-01   High Mar 4 and a bull trigger    
• RES 1: 111-30+ High Apr 1   
• PRICE:‌‌ 111-26+ @ 16:42 BST Apr 1 
• SUP 1: 110-23   20-day EMA 
• SUP 2: 110-09+/06 50-day EMA / Low Mar 27 
• SUP 3: 110-00   High Feb 7 and a key support 
• SUP 4: 109-20   Trendline support drawn from the Jan 13 low      

Treasury futures are building on to their latest gains following the recovery from last week’s low of 110-06+ (Mar 27). The outlook remains bullish and attention is on key resistance at 112-01, the Mar 4 high. A break of this level would confirm a resumption of the uptrend that started Jan 13, and open 112-13, a Fibonacci projection. Initial support to watch is 110-23, the 20-day EMA.    

• Fed Funds implied rates sit within the day’s range having pared some of the day’s decline seen after soft new orders and employment details of ISM mfg (tempered by strong prices paid) and lower than expected JOLTS openings.
• Cumulative cuts from 4.33% effective: 5.5bp May, 21bp Jun, 37.5bp Jul and 78.5bp Dec.
• The 78.5bps of cumulative cuts priced for 2025 is within the day’s 75-80bps range (80bp seen both pre- and post-1000ET data) but that 5bp range is relatively tight by recent day standards.
• US rates see sizeable outperformance to European peers today, with the SFRZ6 7.5 ticks richer vs 3 ticks for Euribor.
• It sees the SOFR implied terminal yield at 3.36%, only 2bp higher than post-data fresh lows since the November presidential election and indeed since Oct 2024, as negative growth concerns are seen on balance to outweigh the inflation angle ahead of tomorrow’s reciprocal tariff announcements.