OUTLOOK: Price Signal Summary - Resistance In Bunds Remains Intact
* In the FI space, Bund futures continue to trade above their recent lows. A bear threat remains p...
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
BONDS: BTP/Bund spread falls toward 80bps
- Although most Bonds are trading within the early ranges, some investors will be keeping an eye on the more macro moves.
- The BTP/Bund spread is through last Week's low of 82bps, now 1.4bp tighter on the day and looking to challenge the Psychological 80bps level.
- But as noted last month, looking at that longer term chart, aside from the April 2010 low situated at ~75.4bps, the next big support resides at 65.37bps, the 2009 low.
(Chart source: Bloomberg Finance LP/MNI).
SOFR: Long Setting Most Prominent In Futures On Friday
OI data points to net long setting dominating in the white, red and green SOFR futures packs on Friday, with only one round of modest net long cover (SFM5) and a single round of net short cover (SFRH7) interrupting the theme across the front 10 contracts.
- Net short cover was most prominent in the blues.
| 25-Jul-25 | 24-Jul-25 | Daily OI Change |
| Daily OI Change In Packs |
SFRM5 | 1,270,601 | 1,275,532 | -4,931 | Whites | +50,498 |
SFRU5 | 1,313,500 | 1,291,672 | +21,828 | Reds | +9,813 |
SFRZ5 | 1,325,058 | 1,313,615 | +11,443 | Greens | +4,083 |
SFRH6 | 1,046,060 | 1,023,902 | +22,158 | Blues | -3,478 |
SFRM6 | 868,492 | 860,789 | +7,703 |
|
|
SFRU6 | 828,586 | 825,523 | +3,063 |
|
|
SFRZ6 | 916,954 | 915,946 | +1,008 |
|
|
SFRH7 | 720,970 | 722,931 | -1,961 |
|
|
SFRM7 | 702,287 | 698,354 | +3,933 |
|
|
SFRU7 | 520,185 | 517,905 | +2,280 |
|
|
SFRZ7 | 448,454 | 449,803 | -1,349 |
|
|
SFRH8 | 330,064 | 330,845 | -781 |
|
|
SFRM8 | 224,457 | 224,081 | +376 |
|
|
SFRU8 | 202,744 | 200,770 | +1,974 |
|
|
SFRZ8 | 199,182 | 203,102 | -3,920 |
|
|
SFRH9 | 142,499 | 144,407 | -1,908 |
|
|
US TSYS: Gains Pared, Double Issuance And Borrowing Estimates In Focus
- Treasuries have pared gains as US desks filter in, after a mixed overnight session digesting the weekend US-EU trade deal that includes 15% tariffs on most EU goods. US-China talks in Stockholm meanwhile continue through Tuesday.
- Today sees Treasury announcements in focus, with double 2Y and 5Y issuance before Treasury’s borrowing estimates at 1500ET ahead of Wednesday’s full QRA.
- Cash yields are 0-0.5bp lower on the day.
- TYU5 trades at 110-31 (-00+) having eased off London highs of 111-03, with subdued cumulative volumes of 265k.
- Resistance remains at 111-14+ (Jul 22) whilst support is monitored, seen at 110-19+ (Jul 24 low) after which lies 110-08+ (Jul 14/16 low).
- Data: Dallas Fed mfg Jul (1030ET)
- Treasury borrowing estimates (1500ET): It should show a substantial increase in Treasury’s estimate for marketable borrowing in the current quarter (Jul-Sep). We have pencilled in a $950B-$1T borrowing need in the quarter (on a financing need of $500-550B), up from the May refunding round’s $554B estimate. MNI preview: https://media.marketnews.com/MNI_US_Deep_Dive_Issuance_2025_07_Refunding_e2af296ce5.pdf
- Coupon issuance: US Tsy $69B 2Y Note - 91282CNP2 (1130ET), US Tsy $70B 5Y Note - 91282CNN7 (1300ET)
- Bill issuance: $73B 26W bill auctions (1130ET), $82B 13W bill auctions (1300ET)
