OPTIONS: Expiries for Nov02 NY cut 1000ET (Source DTCC)

• Treasuries are extending session lows at the moment, no obvious headline driver as yet, while Bbg US$ pares loss (BBDXY -1.86 at 1223.14, as do crude prices: WTI at $91.86/bbl.
• TYZ6 just marked 104-07 low (-14), yield +.0299 at 5.6425% (closing in on yesterday's 24-year high of 5.6772%.
• Yesterday's low reinforces the bear trend for the Dec'26 10Y contract. Scope is seen for an extension towards 103-15+, a Fibonacci projection.

• RES 4: 1.3599 High Aug 28
• RES 3: 1.3568 High Sep 9 
• RES 2: 1.3412 50-day EMA
• RES 1: 1.3311/1.3348 High Sep 30 / 20-day EMA
• PRICE: 1.3227 @ 17:27 BST Oct 02
• SUP 1: 1.3181 Low Oct 01
• SUP 2: 1.3140 Low Jun 24 and a key M/T support
• SUP 3: 1.3096 Low Nov 25 ‘25
• SUP 4: 1.2984 50.0% retracement of the Jan 13 ‘25 - Jan 27 bull leg  

The trend structure in GBPUSD remains bearish. A fresh cycle low on Thursday confirmed a flag formation - a bearish continuation signal that reinforces current trend conditions - on the daily chart. Note that moving average studies are in a bear-mode position, highlighting a dominant downtrend. Scope is seen for an extension towards 1.3140, the Jun 24 low and the next key support. Resistance at the 20-day EMA is at 1.3348.           

• A softer-than-expected US employment report helped the USD edge further away from recent cycle highs on Friday, with DXY printing a session low of 101.67, from yesterday’s 102.21 peak. However, a strong reversal higher for US yields as the dust settled post-data prompted a modest recovery, allowing the USD index to stabilise around the 101.90 mark ahead of the close.
• The recovery was most notable against the Japanese yen, where spot resides about 90 pips above the post-NFP lows at 157.85. Broadly, net adjustments across the G10 have been moderate today, providing a consolidating session after the significant volatility on show during Thursday trade.
• The DXY looks set to post its third consecutive substantial weekly rise, extending the post-Fed advance to well over 2% as the global yield surge continues to provide support for the greenback. A close at current levels would be the highest weekly close since April 2025, significantly bolstering the bullish trend in place.
• Given the high weighting in the index, the potential for an extension of EUR weakness will be under the microscope next week as market participants continue to monitor the French/OAT pressures that have gathered pace this week and taking other EGB markets with them. EURUSD is just 40 or so pips from strong support, and a broader stabilisation for risk sentiment may be required for this area just above 1.12 to hold.
• Elsewhere, NZD and MXN still appear vulnerable to an extension of the dollar rally, given their outsized weakness across September. A break below 0.5581 for NZDUSD would mark near-18-month lows, while USDMXN looks to target some notable retracement levels from the substantial 2025-2026 price swing.