OUTLOOK: Price Signal Summary - Bund Is Oversold But Remains Bearish
Dec-12 11:19
- In the FI space, Bund futures remain in a bear-mode cycle and the contract is trading closer to its recent lows. Scope is seen for an extension towards the 127.00 handle. Key short-term resistance is 128.75, the Dec 3 high. Note that the contract is oversold. A stronger corrective bounce would allow this oversold condition to unwind. Wednesday's price pattern is a doji candle - a short-term reversal signal.
- Recent weakness in Gilt futures exposed an important support at 90.53, the Nov 25 / 26 low, however, a recovery from Monday’s low has eased a bearish threat. A breach of 90.53 would signal scope for a deeper retracement towards 89.86, the Nov 19 low and bear trigger. For bulls, a stronger resumption of gains would instead signal scope for a climb to resistance at 92.55, the Nov 11 high. Initial firm resistance is 91.93, the Nov 27 high.
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FED FUNDS FUTURES: FFF6/G6 Spread Lifted
Nov-12 11:19
FFF6/G6 paper paid -9.5 on 22.5K, ~24K trades there all day. Level is taken bid over with small trading at -9.0 on the follow.
US TSY OPTIONS: Large Upside Structures in Options
Nov-12 11:13
- Some suggestion that Real Money is said to have been HUGE buyers of Upside via Option with around 300k going through this past Week.
- These are looking for a more Dovish path which could be supported given the Latest poor round of US Employment Data.
- The TYF (expiry 26th Dec) 113.50 and 114 calls have mostly been targeted and have been bought in 200k and 100k respectively, these will also expire when the UK are closed.
GILT SYNDICATION: 1.75% Sep-38 linker: Allocations
Nov-12 11:12
- Hedge Ratio: 55% vs 1.125% Nov-37 linker (ISIN: GB00B1L6W962)
- Size: GBP4.25bln (MNI expected GBP GBP4.5-5.5bln) So a little below our expected range despite the strong books.
- Spread set earlier at 1.125% Nov-37 linker (GB00B1L6W962) +10.50bps (guidance was +10.50 / +10.75bps)
- Books closed in excess of GBP69bln pre-rec (inc JLM interest of GBP3.96bln)
- ISIN: GB00BMY62Z61
- Settlement Date: 13-November-2025 (T+1)
- JLMs: GSIB (B&D/DM) / JPM / NOMURA / SANTANDER
- Timing: Hedge deadline 11.30GMT
Source: Market source and MNI colour
