US 10YR FUTURE TECHS: (M5) Recovers Well Off Support
- RES 4: 112-13 1.500 proj of the Jan 13 - Feb 7 - Feb 12 price swing
- RES 3: 112-01 High Mar 4 and a bull trigger
- RES 2: 111-17+/25 High Mar 20 / 11
- RES 1: 111-05 High Mar 28
- PRICE: 111-04+ @ 16:54 GMT Mar 28
- SUP 1: 110-07/06 50-day EMA / Low Mar 27
- SUP 2: 110-00 High Feb 7 and a key support
- SUP 3: 109-17+ Trendline support drawn from the Jan 13 low
- SUP 4: 109-19 50.0% retracement of the Jan - Mar bull cycle
Treasury futures are recovering well, rallying off support to post a strong weekly gain. This keeps price well above 110-07, the 50-day EMA - the key S/T pivot level - a clear break of it would signal scope for a deeper retracement. This would expose an equally important support at 110-00, the Feb 7 high. Clearance of both levels would be bearish. The medium-term trend condition is bullish, the first key resistance is located at 111-17+, the Mar 20 high.
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US 10YR FUTURE TECHS: (M5) Bull Cycle Remains In Play
- RES 4: 111-22+ High Dec 3 ‘24 and a key resistance
- RES 3: 111-00 Round number resistance
- RES 2: 110-31 1.00 proj of the Jan 13 - Feb 7 - Feb 12 price swing
- RES 1: 110-20+/21 High Feb 26 / 25
- PRICE: 110-17 @ 16:50 GMT Feb 26
- SUP 1: 110-00 High Feb 7 and a recent breakout point
- SUP 2: 109-11 50-day EMA and a key near-term support
- SUP 3: 108-21 Low Feb 19
- SUP 4: 108-03+ Low Dec 12 and a bear trigger
Treasury futures have traded higher this week. The contract has pierced resistance at 110-20, the 76.4% retracement of the Dec 3 - Jan 13 bear leg.
This broadens the bullish recovery and signals scope for a climb towards the 111-00 handle, ahead of 111-22+, the Dec 3 high and a key resistance. Initial firm support to monitor is 109-11, the 50-day EMA. A move below this average is required to highlight a potential reversal.
US: OMB Sets Out Plans For Large-Scale Staff Cuts And Govt Reorganisation - BBG
Bloomberg reporting that the White House Office of Management and Budget has directed federal government agencies "to drastically reduce the size of the US government" laying out a two-phase reform framework. The first phase would cover cuts to staffing, with proposals due March 13. The second phase would cover organisational overhaul, with proposals due April 14. The memo states that mass layoffs would occur in June - three months after first-phase plans are submitted to the OMB.
- Notably, the deadline for the first-phase proposals comes a day before Congress must legislate a spending package to avert a government shutdown. Polymarket notes there is a 50% implied probability of a shutdown in 2025, with the elevated risk reflecting Democrats' public statements hinting that they could use the shutdown as leverage to oppose the OMB's and Elon Musk's hardline federal government reform programme. The memo is likely to fortify the Democrat position and nudge Congress closer to a shutdown.
- Bloomberg notes: "The memo didn’t provide any specific targets for job cuts, but said the “starting point” for the plans should be workers deemed non-essential during a government shutdown." That definition could be applied to roughly 40% of federal workers traditionally furloughed during a government shutdown.
- OMB Director Russell Vought said in the memo: “The federal government is costly, inefficient, and deeply in debt. At the same time, it is not producing results for the American public. The American people registered their verdict on the bloated, corrupt federal bureaucracy... by voting for President Trump...”
OPTIONS: Larger FX Option Pipeline
- EUR/USD: Feb28 $1.0396-00(E2.8bln), $1.0550(E1.7bln), $1.0600(E1.0bln); Mar03 $1.0470-75(E1.0bln); Mar04 $1.0520-30(E1.9bln)
- USD/JPY: Feb28 Y150.00($1.1bln)
- AUD/USD: Feb28 $0.6500-10(A$1.2bln); Mar04 $0.6335(A$1.2bln)
- USD/CAD: Feb28 C$1.4290-00($1.5bln); Mar03 C$1.4300($1.6bln), C$1.4315-25($1.2bln)
