OUTLOOK: Price Signal Summary - Bear Cycle In Bunds Extends

You are invited to listen to a Livestreamed MNI Connect Video Conference with Federal Reserve Bank of Atlanta Raphael Bostic.

Details below:

• Speaker: Raphael Bostic, Federal Reserve Bank of Atlanta President
• Topic of discussion: 'The US Economic Outlook'
• DATE: Mon, 30 Jun 2025
• TIME: 15:00 - 16:00 BST
• This event is on the record and will run as a Zoom Webinar

To register please go to: MNI Webcast Registration

• In the FI space, the latest pullback in Bund futures still appears corrective - for now - and the trend condition remains bullish. Moving average studies are in a bull-mode position highlighting a dominant uptrend. A resumption of gains would signal scope for a climb towards 131.85, the Apr 22 high and a key resistance. Key short-term support to watch is 128.97, the May 14 low. First support lies at 130.12, the Jun 5 low.
• Gilt futures traded higher yesterday, resuming their short-term uptrend, strengthening the current bullish theme. This also marks an extension of the breach of resistance at 91.87, the May 20 high. The climb signals scope for a continuation higher and sights are on the 93.00 handle next. Initial firm support to watch lies at 91.56, the Jun 9 low. A clear break of this level is required to signal a possible reversal. For now, short-term weakness is considered corrective.

Modest SOFR & Treasury option volume overnight, SOFR leaning towards downside puts with some decent 5Y Tsy put buying as markets await this morning's key CPI inflation data. Projected rate cut pricing steady to slightly cooler vs. late Tuesday (*) as follows: Jun'25 steady at 0.0bp, Jul'25 steady at -3.6bp, Sep'25 at -16.6bp (-16.9bp), Oct'25 at -28.1bp (-28.6bp), Dec'25 at -43.1bp (-44.2bp).

• SOFR Options:
  • 5,000 SFRU5 95.50 puts, 0.5 ref 95.845
  • 1,700 SFRU5 95.75/95.81 2x1 put spds
  • 2,000 SFRU5 95.81/95.93/96.06 call flys
  • 3,000 SFRN5 95.37/95.62/95.75 broken put flys
  • 2,000 SFRZ5 95.56/95.68/95.81 put flys ref 96.08
  • 3,400 SFRU5 95.75 puts ref 95.85
  • 1,500 SFRQ5 95.81 puts, ref 95.845
• Treasury Options:
  • 2,000 TYN5 113/113.5 call spds ref 110-04.5
  • over 10,000 FVN5 107.5 puts, 14-15 ref 107-20.5
  • near 5,000 FVN5 107.5/108 strangles
  • +3,000 wk2 US 111 puts, 6-7 ref 112-14 to -17
  • Block, 8,000 TYN5 112 calls, 2 ref 110-06.5
  • 2,000 Mon wkly TY 110 puts ref 110-07.5