LOOK AHEAD: Thursday Data Calendar: ULC, Weekly Claims, Fed Speaker Musalem

SOFR & Treasury options trade outlined below: mixed wing trade on modest overall volumes as US markets return from 4th of July holiday. Underlying also narrowly mixed: curves flatter as Bonds pared early gains to finish near lows. Projected rate hike pricing near steady vs. early morning levels (*): Jul'26 at +6.3bp (+6bp), Sep'26 at +16.9bp (+16.1bp), Oct'26 at +21.8bp (+20.4bp), Dec'26 +30.1bp (+29bp).

• SOFR Options:
  • +5,000 SFRQ6 96.25/96.31 call spds, 0.75 ref 96.13
  • +5,000 SFRU6 95.81 puts, 1.5 ref 96.125
  • 5,500 SFRU6 95.56/95.68/96.12/96.25 put condors ref 96.125
  • +25,000 SFRZ6 97.50 calls, 1.75 ref 96.00
  • +2,000 OQZ6 96.25/96.50 call spds 4.5 over 95.25/95.50 put spds ref 96.10
  • +10,000 SFRZ6 97.50 calls, 1.75 ref 96.00
  • -1,000 SFRZ6 95.31/96.81 strangle, 15.5 ref 96.00
  • +10,000 0QQ6 96.12/96.25/96.31 call trees, 0.5ref 96.025
  • +2,000 2QQ6/2QU6 96.25 straddle spread 7.25 net
  • -4,000 SFRV5 95.56/95.68 put spd, 1.75, 96.00
  • +10,000 SFRZ6 95.37/95.50/96.06/96.18 put condor 6.5-6.75 ref 96.00
  • 1,600 SFRZ6 95.87/96.06/96.25 call flys
  • 3,500 SFRN6 96.12 puts ref 96.14
  • +5,000 0QZ6 96.18/96.37/96.56/96.75 call condor 4.0 ref 96.115
  • 2,000 SFRZ6 95.81/95.93/96.06/96.12 put condors ref 96.015
  • +2,000 SFRQ6 96.12/96.18/96.25 call flys, 1.5
• Treasury Options:
  • 3,600 TYU6 112.5/114.5 1x3 call spds, 2 net (3-leg over) ref 109-18
  • +13,500 USU6 110/111 put spds, 16-17 ref 112-11
  • 4,000 FVQ6 107.5 calls, 6 ref 107-00
  • 6,000 FVQ6 106.5/107 2x1 put spds
  • 4,500 TYQ6 109.5/110 strangles
  • 4,500 FVQ6 109 calls, .5, total volume over 12,000
  • 2,000 TYU6 110.5/113.5 call spds ref 109-23
  • 40,400 wk3 TY 109.75 calls, 19 ref 109-23.5 (exp 7/17)
  • -5,000 TYQ6 108/109.5 put spds, 15 vs 109-25 to -24.5/0.35%
  • 1,200 TUU6 102.37/102.87 put spds vs. 103.5/104 call spds ref 103-04.12
  • +2,000 wk3 TY 109.25/110 2x5 call spd, 18
  • +3,000 FVQ6 106.25/106.5 put spds, 3 vs 106-31/0.08%
  • 3,500 TYU6 112 calls, 6
  • +3,000 TYU6 112.5 calls, 5
  • -3,000 TYU6 108 puts, 13 vs 109-19.5/0.19%
  • +4,000 USQ6 111.5 puts, 26 to 27
  • +3,000 wk3 TY 109/109.75 1x2 call spd, 14

• RES 4: 111-03   50.0% retracement of the Mar 2 - May 19 bear leg
• RES 3: 110-28+ High May 7, 2026
• RES 2: 110-14   38.2% retracement of the Mar 2 - May 19 bear leg
• RES 1: 110-10+ High Jun 26
• PRICE:‌‌ 109-20 @ 19:18 BST Jul 7
• SUP 1: 109-12+ Low Jul 02
• SUP 2: 109-06/108-25 Low Jun 22 and key S/T support / Low Jun 08 
• SUP 3: 108-08+ Low May 19 and the bear trigger
• SUP 4: 108-04   1.382 proj of Apr 17 - May 4 - 7 swing

The pullback last week in Treasuries highlights a key short-term resistance at 110-10+, the Jun 26 high. Recent gains have resulted in a breach of the 50-day EMA, and a move through resistance at 110-00+, the May 29 high. The break continues to highlight a possible short-term  reversal. Sights are on 110-14, a Fibonacci retracement. First key support to watch remains 109-06, the Jun 22 low. Clearance of this level would be bearish.

• RES 4: 1.1621 Trendline resistance drawn from the Apr 17 high
• RES 3: 1.1547 50-day EMA 
• RES 2: 1.1528 High Jun 18
• RES 1: 1.1473 High Jul 02
• PRICE: 1.1437 @ 19:25 BST Jul 7
• SUP 1: 1.1362/25 Low Jul 1 / Low Jun 24 and the bear trigger
• SUP 2: 1.1299 2.000 proj of the Jan 27 - Feb 6 - 10 price swing
• SUP 3: 1.1210 Low May 29 ‘25
• SUP 4: 1.1111 50.0% retracement of the Feb 3 ‘25 - Jan 27 bull leg 

The latest move higher in EURUSD appears corrective. The pair has pierced 1.1466, the 20-day EMA. A clear break of this average would signal scope for a stronger recovery, potentially towards 1.1547, the 50-day EMA. A bearish trend condition remains intact, highlighted by moving average studies that are in a bear-mode position. The bear trigger lies at 1.1325, the June 24 low. A break of this level would confirm a resumption of the downtrend.