GOLD: Gold’s Decline Continues
May-01 04:55
- Gold’s decline continued in the Asian trading day, having opened at US$3,288.73.
- Following a mixed bag of US economic data last night confused signals and sent gold lower after an unexpected contraction in GDP was followed by Core PCE and strong pending home sales questioned whether rate cuts were imminent.
- Much of gold's rise can be attributed to it's 'safe haven status' and as US Treasury Secretary Bessent indicates that some trade deals are about to be announced, gold has the potential to fall further from here.
- Gold lost further ground today down -1.7% to $3,229.25
- Having reached a new high earlier in April of $3,423.98 gold has retreated over 5% since.
- Year to date gold remains one of the best performing assets up over 23% but as hedge fund positioning has turned more neutral it seems likely to be in for a period of consolidation as the world assesses the next phase of the trade war.
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BUND TECHS: (M5) Bull Cycle Remains In Play
Apr-01 04:54
- RES 4: 130.40 Low Feb 19
- RES 3: 130.26 61.8% retracement of the Feb 28 - Mar 11 bear leg
- RES 2: 130.00 Round number resistance
- RES 1: 129.59 High Mar 31
- PRICE: 128.81 @ 05:36 BST Apr 1
- SUP 1: 128.47 Low Mar 28
- SUP 2: 127.74 Low Mar 25 and a key short-term support
- SUP 3: 127.20 Low Mar 17
- SUP 4: 126.53 Low Mar 11 and the bear trigger
Bund futures traded to a fresh short-term cycle high Monday before retreating. Recent gains are considered corrective, however, the breach of the 20-day EMA and a print above resistance at 129.41, the Jan 14 low, strengthens a bullish theme and opens the 130.00 handle and 130.26, a Fibonacci retracement. Key short-term support to watch lies at 127.74, the Mar 25 low. Clearance of this level would highlight a reversal.
JGBS: Futures Holding Weaker Ahead OF US Jolts & ISM Data
Apr-01 04:47
JGB futures are holding weaker, -18 compared to the settlement levels.
- Outside of the previously outlined labour market and Tankan survey data, there hasn't been much by way of domestic drivers to flag.
- " The impact of the tariffs on Japan could range from minimal to severe, depending on whether the US focuses solely on agricultural tariffs or also includes value-added taxes and non-tariff barriers. Japan's response is unclear, but Prime Minister Shigeru Ishiba may seek to win concessions by relaxing non-tariff barriers to US imports rather than planning retaliation." (per BBG)
- Cash US tsys are ~1bp richer in today's Asia-Pac session after yesterday's modest gains. Today's US calendar will be highlighted by JOLTS and ISM Mfg data.
- Cash JGBs are flat to 3bps cheaper, with a steepening bias, across benchmarks. The benchmark 10-year yield is 1.6bps higher at 1.506% versus the cycle high of 1.596%.
- Swap rates are little changed. Swap spreads are tighter.
- Tomorrow, the local calendar will see Monetary Base data alongside BoJ Rinban Operations covering 1-3-year and 25-years+ JGBs.
US TSYS: Cash Bonds Slightly Richer Ahead Of JOLTS & ISM MFG Data
Apr-01 04:29
TYM5 is 111-17, +0-10 from closing levels in today's Asia-Pac session.
- According to MNI's technicals team, TYM5 remains well off the initial technical resistance of 111-22.5 (today's intraday high) - next resistance above at 112-01 (High Mar 4 and a bull trigger).
- Cash US tsys are slightly richer in today’s Asia-Pac session after small losses early.
- Month/quarter-end rebalancing flow tempered Monday morning's risk-off support ahead of Wednesday's US tariff deadline.
- From our latest US Treasury Deep Dive (Here) - the Treasury isn’t expected to raise the size of its coupon offerings until Q4 2025 at the earliest, with consensus on such a shift moving following the February refunding announcement to Nov 2025/early 2026, from Aug/Nov 2025 prior.
- Today’s US calendar will be highlighted by JOLTS and ISM Mfg data.
