US TSYS: Modest Rally Aided By Further Oil Declines, Within Yesterday's Range

Treasuries are modestly firmer across the curve with a tailwind from lower crude oil futures (WTI -2.4%). Today sees data including weekly ADP, a full trade release and existing home sales – with CPI looming tomorrow – before 3Y supply. President Trump’s schedule doesn’t see any public facing appearances today. 

• Cash yields are 0.7-2.5bp lower on the day, with declines led by the front end.
• Steepening continues to only pare Friday’s post-NFP flattening, with 2s10s for instance at 40.7bp vs 42-43bp pre-data via a low of 37bp later on Friday.
• TYU6 trades at 109-02+ (+01+) on lighter cumulative volumes of 265k, comfortably within yesterday’s range throughout.
• Resistance remains intact at 109-18 (20-day EMA) after which lies 110-00+ (May 29 high). Prior weakness has reinforced a medium-term bearish theme with support at 108-25 (Jun 8 low) before the bear trigger at 108-08+ (May 19 low).
• Data: Weekly ADP (0815ET), Trade balance Apr (0830ET), Existing home sales May (1000ET), Wholesale trade sales/inventories Apr/Apr F (1000ET)
• Coupon issuance: US Tsy $58B 3Y Note auction - 91282CQV6 (1300ET). Last month’s 3Y tailed by 0.5bp and the bid-to-cover slipped from 2.68x to 2.58x, whilst last week’s 5Y offering registered a twelfth consecutive auction without a trade-through (albeit just a 0.1bp tail last week).
• Bill issuance: US Tsy $65B 6W & $50B 52W bill auctions (1130ET)
• Politics: Trump in policy meetings (1400ET, 1530ET, 1730ET – all closed press)