JGBS: Futures Cheaper Overnight With US Tsys, BOK Takata Speech Due

Bond futures finished ahead in the US trading day despite stronger equities as a better than expected 2-Yr auction drove sentiment.  The 10-Yr future closed up +05 at 111-26+ , but still below all major moving averages.  The demand for bonds saw the 2-Yr auction demand stronger and resulting in the yield below initial pricing.  Futures have opened flat at 111-26 in Asia today 

Cash was stronger across the curve with the long end outperforming and has recovered from the JGB sell off from last week. 

• The 2-Yr finished down -0.4bps at 3.592%
• The 5-Yr was down -0.3bps at 3.823%
• The 10-Yr was down -1.2bps at 4.215%
• The 30-yr was down -2.5bps at 4.803%

The Texas Manufacturing Outlook Survey produced by the Dallas Fed shows a much stronger improvement in January than expected, the latest piece of data indicating a pickup in manufacturing activity to start the year as Durable Goods November Preliminary was ahead of expectations at 5.3% vs exp. 4.0% and prior of -2.1%

See our Fed Preview Here MNI FED WATCH: Holding Steady With Rates Near Neutral

January 2026 FOMC Analyst Views: See You In March  < Fed_Prev_Jan2026_With_Analysts_22448bf33a.pdf >

Projected rate cut pricing largely steady vs. late Friday levels (*): Jan'26 at -0.7bp, Mar'26 at -4.2bp, Apr'26 at -7.7bp (-8.2bp), Jun'26 at -19.2bp (-18.7bp), first full cut priced in at Jul'26: -26.7bp (-25.2bp).

• RES 3: 95.982 - 76.4% retracement Sep’24 - Nov’24 downleg
• RES 2: 95.960 - High Apr 7 (cont.)
• RES 1: 95.900 - High Oct 17
• PRICE: 95.155 @ 15:55 GMT Jan 26
• SUP 1: 95.103 - 2.0% Lower Bollinger Band
• SUP 2: 95.100 - Low Jan 23
• SUP 3: 94.248 - 1.0% 10-dma envelope

Aussie 10-yr futures remain under pressure, with the jobs data print adding to the downside argument. This puts prices still south of all major support levels. With 95.275 cleared, prices are pushing to new contract lows, opening vol-band support through 95.103 and into 94.248. Any recoveries need to break back above 95.900 to signal near-term bullish traction.

• RES 3: 97.796 - 1.618 proj of the Sep 3 - 12 - 15 price swing
• RES 2: 96.780 - High Jun 26 (cont)
• RES 1: 96.700 - High Sep 12  
• PRICE: 95.710 @ 15:51 GMT Jan 23
• SUP 1: 95.655 - Low Jan 23
• SUP 2: 95.480 - Low 1st Nov ‘23
• SUP 3: 94.932 - 1.0% 10-dma envelope

Prices fell sharply on the stronger-than-expected jobs print last week, pressuring prices again to recent lows. This adds to pricing for additional RBA tightening this year - which should keep the front-end of the curve under pressure. This keeps prices well below prior resistance at 96.615, the Sep 12 high, and refocuses attention on 95.480 as the next major support.