EM LATAM CREDIT: TGS: New 10NC5 Launch

• Treasuries look to finish modestly higher - off early highs after rates climbed to the highest levels since prior to FOMC rate cut on September 17. Currently, Tsy Dec'25 10Y contract trades 113-13.5 (+8.5), yld 4.0167% -.0154; curves steeper: 2s10s +1.166 at 54.023, 5s30s +2.680 at 101.900.
• Initial resistance at 113-17+ (intraday high), followed by 113-29 (High Sep 11 and the bull trigger). On the downside, support at the 50-day EMA at 112-15 remains intact for now. A clear break of the average would expose 111-13+, the Aug 18 low and a key support.
• Little reaction as Fed Chairman Powell delivers his keynote address at the NABE annual meeting, Powell largely maintained status quo in terms of signaling another 25bp rate cut at the end of October.
• In his written remarks, Powell said "based on the data that we do have, it is fair to say that the outlook for employment and inflation does not appear to have changed much since our September meeting four weeks ago" when of course they cut rates 25bp eyeing "Rising downside risks to employment".
• Projected rate cut pricing largely steady vs. late Monday levels (*): Oct'25 at -24.2bp (-24.7bp), Dec'25 at -48.4bp (-48.1bp), Jan'26 at -61.2bp (-61bp), Mar'26 at -74.1bp (-73.5bp).
• Look ahead: Wednesday's CPI and Real Avg Hourly/Weekly Earnings suspended due to the Gov shutdown. The Fed will release it's Beige Book at 1400ET. Fed speakers continue: Fed Govs Miran and Waller at separate venues, KC Fed Schmid.

• RES 4: 180.00 Psychological round number  
• RES 3: 179.91 Top of a bull channel drawn from the Feb 28 low
• RES 2: 178.94 1.236 proj of the Jul 31 - Sep 29 - Oct 2 price swing
• RES 1: 177.94 High Oct 10 and the bull trigger   
• PRICE: 176.18 @ 17:10 BST Oct 14
• SUP 1: 175.67 Low Oct 10 
• SUP 2: 174.87 20-day EMA   
• SUP 3: 173.24 High Oct 3 and a gap low on the daily chart    
• SUP 4: 172.27 Low Oct 2 and a key medium-term support  

The trend set-up in EURJPY is bullish and the latest pullback appears corrective. First key support to watch lies at 174.87, the 20-day EMA. A breach of this EMA would signal scope for a deeper retracement. On the upside, the cross has cleared resistance at 175.13, the Sep 29 high, to confirm a resumption of the primary uptrend. A reversal higher would open 178.94, a Fibonacci projection.  

Heavy SOFR and Treasury option volumes Tuesday, flow mixed & varied - SOFR leaning towards upside call structures. Underlying futures are firmer, off early highs (Sep 17 lvls - prior to FOMC rate cut). Projected rate cut pricing largely steady vs. late Monday levels (*): Oct'25 at -24.2bp (-24.7bp), Dec'25 at -48.4bp (-48.1bp), Jan'26 at -61.2bp (-61bp), Mar'26 at -74.1bp (-73.5bp).

• SOFR Options:
  • Block, 10,000 SFRZ5 96.50/96.62 call spds, 1.5 net
  • Block, 25,000 0QZ5 98.00 call spds, 1.25 net ref 97.035
  • -10,000 SFRX5 96.37 straddles 10-8 ref 96.37
  • Block/screen +90,000 0QZ5 98.00 calls, 1.0 ref 97.035
  • +20,000 SFRZ5 96.50/96.62 call spds, 1.5
  • +4,000 SFRZ5 96.18/96.31/96.43 2x3x1 put flys, 0.5
  • +4,000 SFRX5 96.25/96.31/96.43/96.50 put flys, 4.25
  • -2,000 SFRX5 96.37 straddles 10-9.5
  • 2,100 SFRZ6 96.62/97.00 2x1 put spds
  • over 8,300 SFRZ5 96.06/96.18 2x1 put spds ref 96.375
  • over 20,000 SFRZ5 96.37/96.50/96.56 broken call flys, 2.75 ref 96.38
  • 2,500 SFRZ5 96.12/96.37/96.62 call flys ref 96.375
  • Block, +2,500 0QZ5 96.75/96.87 put spds, 3.5 ref 97.035
  • Block, -3,000 SFRZ5 96.25/96.37 put spds, 3.75 ref 96.375
  • +16,000 SFRF6 96.68/96.87/97.06 call flys, 2.5 ref 96.385/0.05%
  • -2,000 0QZ5 96.68/96.81 2x1 put spds 0.5 vs. 97.025/0.05%
  • +2,000 SFRZ5 96.06/96.12/96.18/96.25 put condors, 1.0 vs. 96.405/0.06%
  • +4,000 0QZ5 96.12/96.50 put spds, 1.0 ref 97.015/0.05%
  • +2,200 0QH6 97.12 calls, 21.5 ref 97.075
  • over 5,700 SFRF6 96.87 calls ref 96.62
  • +4,000 SFRZ5 96.50/96.56 call spds, 1.0 ref 96.38
  • 7,500 SFRZ5 96.62/97.00 2x1 put spds, 0.5 ref 97.075
  • 1,500 0QZ5 97.12/97.25/97.37/97.50 call condors ref 97.075
  • +17,000 SFRU6 96.56/96.81 2x1 put spds, 1-2 ref 96.97 to 97.005
  • +3,500 SFRM6 97.00 calls, 18.5 vs. 96.84/0.40%
• Treasury Options:
  • Block: 10,000 TYZ5 115 calls 16 vs. 13,000 TYG6 115.5 calls 31, vs. 1,000 TYZ 113-07.5
  • over 2,700 USX5/USZ5 114 put spds, 19 ref 118-05
  • Block, 7,000 TUZ5 103.87/104.12/104.25/104.37 broken put condors, 0.5 net
  • 10,000 TYZ5 114.5 calls, 22 ref 113-08
  • -8,000 TYZ5 113.5/114.5 call spds, 8
  • -5,000 TYF5 113.5 straddles, 210
  • 1,000 USX5 115/117 put spds, 15 ref 118-20
  • 1,500 TYX5 112.75 puts, 9
  • 1,000 TYZ5 111.5/113 put spds
  • -4,000 FVZ5 109.5 puts, 23 ref 109-25.5
  • 3,000 TYX5 114/115 call spds over 111.5 puts ref 113-13
  • 2,500 TUZ5 105 calls, 3.5 ref 104-13.75
  • -3,000 TYZ5 115 calls, 19
  • +2,500 TUX5 104.25 straddles, 16
  • +3,000 TYX5 111.5/114 strangles, 14
  • +2,000 FVX5 109.25/109.5 strangles, 31.5
  • -2,000 FVX5 109.25/109.75/110/110.75 broken call condors, 11.5
  • +2,500 TUZ5 105 calls, 3.5 ref 104-13.75
  • 6,000 TYX5 114.5 calls, 5 ref 113-11
  • +3,000 TYZ5 114 calls, 37 vs. 113-14/0.41%
  • +10,000 TYZ5 114.5 calls 6 over 111.5/112.5 put spd ref 113-09
  • -20,400 TYX5 113.5 calls, 16 ref 113-06 to -06.5
  • -9,600 TYX5 112 puts, 3 ref 113-05.5
  • 3,400 wk3 TY 113 puts, 8 ref 113-04.5