BRAZIL: Fin Min Haddad Reaffirms Intention To Step Down In Feb

OI data points to net long setting dominating in net pack terms through the blues as SOFR futures ticked higher on Monday.

• Pockets of net short cover were seen.
• The 10bp uptick in the overnight SOFR fixing reflected year-end turn i.e. liquidity demand as supply becomes less ample during this period (evidenced by an uptick in demand at the NY Feds repo operations) and is expected to fade in early January.

• On the commodity front, the trend structure in Gold is unchanged, it remains bullish and a sharp sell-off yesterday appears corrective - for now. The trend is overbought and a deeper retracement would allow this condition to unwind. First support to watch is $4323.3, the 20-day EMA. It has been pierced, a clear break would expose the 50-day EMA at $4177.0. For bulls, a resumption of gains would open $4578.3, a 1.618 projection of the Oct 28 - Nov 13 - Nov 18 swing.
• The trend condition in WTI futures remains bearish and gains are considered corrective - for now. MA studies are in a bear-mode position, highlighting a dominant downtrend. A key support and the bear trigger at $56.11, the Oct 17 low, has recently been breached. The break highlights a continuation of the downtrend and opens $53.77, a 1.764 projection of the Jul 30 - Aug 13 - Sep 26 price swing. Key S/T resistance is $61.25, the Oct 24 high. First resistance is at $58.59, the 50- day EMA.

OI data points to pretty meaningful net long setting in Tsy futures in curve-wide terms on Monday, with over $16.5mln of fresh DV01 exposure added. 

• Some may link this to anticipation of month-/quarter-/year-end rebalancing flow, although we note that month-end extension estimates are not particularly large. We will check to see if there is an error/secondary OI update later today.
• The biggest DV01 shifts came in the wings of the curve (TU, US & WN).