JGBS: Futures higher Overnight, 30YY At Cycle High Ahead Of Today's Supply

In post-Tokyo trade on Friday, JGB futures closed weaker, -8 compared to settlement levels. The local market was closed yesterday for a holiday.

• Overnight, US tsys extended early weakness after unexpectedly large corporate bond issuance announced ($40.5B with Alphabet making up $17.5B over 8 tranches) - only to gap back to pre-open level after lower-than-expected ISM Mfg & Prices paid data, undershooting implications from regional Fed surveys, MNI Chicago PMI and more optimistic S&P Global PMI.
• Fed Gov Cook said in a speech Monday that she viewed the decision to cut rates in October "as appropriate, because I believe that the downside risks to employment are greater than the upside risks to inflation", while noting that this cut was "another gradual step toward normalization" keeping rates "modestly restrictive, which is appropriate given that inflation remains somewhat above our 2 percent target."
• Bloomberg is reporting "Japan's emergence from decades of deflation is reshaping global finance and markets. Japanese companies that had hoarded cash for years when economic growth was stagnant are now ramping up spending and acquisitions, making them some of the busiest drivers of global dealmaking this year."  (see link)
• Today, the local calendar will see S&P Global Japan PMI Mfg. 

• 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: 95.640 @ 16:08 GMT Nov 3
• SUP 1: 95.510 - Low Sep 3  
• SUP 2: 95.415/95.300 - Low May 15 / Low Jan 14 
• SUP 3: 95.275 - Low Nov 14  (cont) and a key support

Aussie 10-yr futures slipped lower Wednesday on the back of hotter-than-expected Australian inflation. This returned prices lower despite nascent signs of a technical recovery as recently as last week. The sustainability of the pullback will be dependent on prices holding above key short-term support at 95.510, the Sep 3 low. Near-term resistance remains 95.780, the Sep 12 high. A clear break of this level signals scope for a continuation higher and opens 95.960, the 76.4% retracement level for the Sep’24 - Nov’24 downleg. 

• 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: 96.345 @ 16:07 GMT Nov 3
• SUP 1: 96.280 - Low May 15 (cont.)  
• SUP 2: 95.900 - Low Jan 14 (cont.)
• SUP 3: 95.760 - Low 14 Nov ‘24

Having bounced well on the back of the mild US CPI print, Aussie 3-yr futures reversed course Wednesday on strong domestic inflation data containing RBA cut pricing through 2026. This keeps prices well below prior resistance at 96.615, the Sep 12 high, and refocuses attention on 96.280 as the next major support.