US TSY FUTURES: Mix Of Short Setting & Long Cover Seen Thursday
May-09 10:30
OI data points to a mix of net short setting (FV, TY & US) and long cover (TU, UXY & WN) during Thursday’s downtick in Tsy futures, with a slight bias towards the former.
- The net short setting in TY futures provided the most meaningful DVO1 equivalent positioning adjustment.
| 08-May-25 | 07-May-25 | Daily OI Change | OI DV01 Equivalent Change ($) |
TU | 4,075,256 | 4,085,876 | -10,620 | -387,066 |
FV | 6,870,453 | 6,870,308 | +145 | +6,181 |
TY | 4,966,701 | 4,932,329 | +34,372 | +2,173,013 |
UXY | 2,282,425 | 2,284,549 | -2,124 | -185,892 |
US | 1,801,065 | 1,798,982 | +2,083 | +262,261 |
WN | 1,882,967 | 1,888,562 | -5,595 | -1,016,419 |
|
| Total | +18,261 | +852,079 |
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OUTLOOK: Price Signal Summary - USDJPY Trend Structure Remains Bearish
Apr-09 10:28
- In FX, the trend condition in EURUSD is bullish and the recent pullback is considered corrective. Key resistance at 1.0955, the Mar 18 high, was breached last week, confirming a resumption of the uptrend and this maintains the price sequence of higher highs and higher lows. Sights are on 1.1188 next, a 0.764 projection of the Feb 28 - Mar 18 - 27 price swing. MA studies are in a bull-mode position highlighting a dominant uptrend. Initial firm support lies at 1.0844, the 20-day EMA.
- GBPUSD traded sharply lower Monday but is recovering from this week’s low. For now, the recent sell-off appears corrective. Price has traded below the 50-day EMA - a concern for bulls - however, MA studies remain in a bull mode position and this highlights a dominant uptrend. A continued recovery would open 1.2899 and 1.3017, the 38.2% and 61.8% retracement of the Apr 3 - 7 sell-off. A move through Monday's 1.2709 low, would signal scope for a deeper retracement.
- USDJPY maintains a bearish tone and recent gains appear to have been a correction. A resumption of the downtrend and a break of last Friday’s 144.56 low would signal scope for an extension towards 144.13, the 76.4% retracement of the Sep 16 ‘24 - Jan 10 bull leg. Note that moving average studies are in a bear-mode position highlighting a dominant downtrend. Initial firm resistance to watch is 148.74, the 20-day EMA.
LOOK AHEAD: Wednesday Data Calendar: March FOMC Minutes, Fed Speak
Apr-09 10:28
- US Data/Speaker Calendar (prior, estimate)
- 09-Apr 0700 MBA Mortgage Applications (-1.6%, --)
- 09-Apr 1000 Wholesale Inventories MoM (0.3%, 0.4%)
- 09-Apr 1000 Wholesale Trade Sales MoM (-1.3%, 0.8%)
- 09-Apr 1100 Richmond Fed Barkin at Economic Club Washington
- 09-Apr 1130 US Tsy $60B 17W bill auction
- 09-Apr 1300 US Tsy $39B 10Y note re-open (91282CMM0)
- 09-Apr 1400 FOMC Meeting Minutes for March meeting
GERMANY: Coalition Deal Reached, Presentation @ 1500CET, SPD Takes Fin Min
Apr-09 10:26
An agreement has been reached between the conservative Christian Democratic Union (CDU), its Bavarian sister party the Christian Social Union (CSU) and the centre-left Social Democrats (SPD) to form a 'grand coalition' (GroKo) gov't. A press conference to announce the deal will take place at 0900ET/1400BST/1500CET.
- Bild reports: "the CDU/CSU will receive the Ministry of the Interior and the Foreign Office. The SPD gets the Ministry of Finance, the Ministry of Defense and the Ministry of Justice."
- While incumbent finance minister Jörg Kukies hails from the SPD, he has only been in office since November 2024 following the collapse of the 'traffic light' coalition. For the bulk of the past four years the Finance Ministry was headed by Christian Lindner, leader of the fiscally conservative Free Democrats.
- Wire reports suggesting that SPD co-leader Lars Kleinbeil will take the finance minister's office.
- Despite chancellor-in-waiting Friedrich Merz being seen for many years as on the fiscally prudent wing of the CDU, his ceding of the finance ministry to the SPD could hint at a greater focus on immigration and foreign policy for his party. Indeed, the CDU/CSU holding the Interior Minstry and - for the first time in 59 years - the Foreign Ministry provides significant Union control over immigration, and foreign relations at a time of high tension.
- Germany's most popular politician, SPD Defence Minister Boris Pistorius, is set to retain his position.
- May 7 has been heavily touted as the day for Merz's election as chancellor, with the prospect of a 'Weimar Triangle' summit with France and Poland the day after.
