US TSYS: Long End Bears Brunt Of Confluence Of Bearish Factors

• RES 4: 0.7280 Top of a bull channel drawn from the Apr 9 ‘25 low 
• RES 3: 0.7200 Round number resistance  
• RES 2: 0.7187 High Mar 11 and key resistance
• RES 1: 0.7167 High Mar 15 
• PRICE: 0.7163 @ 16:42 BST Apr 15
• SUP 1: 0.6981 50-day EMA 
• SUP 2: 0.6876 Low Apr 6
• SUP 3: 0.6833 Low Mar 30 and a key support
• SUP 4: 0.6740 Trendline support drawn from the Apr 9 ‘25 low  

A bullish theme in AUDUSD remains intact and this week’s rally reinforces current conditions. The setup in the 20- and 50-day EMAs is bullish, and continues to highlight a dominant uptrend. 0.7103, the 76.4% retracement of the Mar 11 - 30 bear leg, has been cleared. This opens key resistance and a bull trigger at 0.7187, the Mar 11 high. First support to watch lies at 0.6981, the 50-day EMA. A clear break of it would undermine the bull theme.   

• Treasuries look to finish weaker, inside session range Wednesday, ongoing focus on Middle East headlines with sentiment apparently buoyed by a lack of increased hostilities in the Middle East if not demonstrative reports of ceasefire reports and/or open egress through the Strait of Hormuz.
• "U.S. and Iran will likely return to Pakistan next week for a second round of peace negotiations, two senior Pakistani officials told MS NOW on Wednesday."
• TYM6 trades -5 at 111-12, 10Y yield +.0277 at 4.2755%. Trend signals remain bearish, highlighted by moving average studies that are in a bear-mode position. Support to watch is 110-16, the Apr 2 low. A break would be bearish. The next important resistance is 111-18+, the 50-day EMA. Clearance of this average is required to signal scope for a stronger recovery that would open 111-31, a Fibonacci retracement.
• The Fed's April Beige Book arguably more robust than Feb's, with more districts on net (8 vs 7) reporting slight/modest growth and gains in employment (4 vs 3; and just 1 seeing declines vs 3 prior), with very little change in inflation reporting (9 vs 8 describing "moderate" price pressures).
• US import prices were far softer than expected in March, including with some downward revisions to February’s surprisingly strong report. However, large conflicting moves in energy components give mixed signals on an underlying basis but strip out the wider fuels category and monthly underlying inflation is still at some of its strongest rates in recent years.
• Japan’s Finance Minister, who has touted the close contact with the US Treasury in recent weeks by alluding to close coordination with foreign authorities. Katayama also states that she expects to speak with Bessent when he visits Japan while en route to China in May.
• LOOK AHEAD: Thursday Data Calendar: Jobless Claims, Regional Fed, IP/Cap-U

Retail sales rose 7.0% Y/Y in the week ending April 11, per this week's Johnson Redbook index release. That constitutes the month-to-date gain, which while below retailers' targeted 7.2% would still represent a post-2022 high.

• A lot of that nominal gain looks to be inflation-driven, with April CPI looking to come in around 4% Y/Y and core closer to 3%, but even that implies overall sales volume growth remains positive by this metric. We get the March Census Bureau data next week.
• The anecdotal section, once again, didn't make any mention of the war in the Middle East or the impact of higher energy prices.  "The first week of April went well. Sales were largely driven by seasonal items as retailers entered the final month of the first quarter. Many stores closed on Easter Sunday so that employees could spend time with their families, which meant Easter week sales were based on six days instead of seven compared to last year. People celebrated by getting together, sharing meals, going to church, and holding Easter egg hunts. Retailers are working to keep prices low to help families make their budgets go further."