US TSYS: Tsys Hold Moderate Losses as Fed Schmid Discuses Economy

• +67,185 USF6 108 puts at cab-7, new position with open interest of 4,024 coming into the session. The Mar'26 options expire in 10 days - the Friday after Christmas.
• Precedent: On Wednesday, December 3: paper bought 84,361 wk2 30Y 106 puts trade on screen at cab-7
  • The 10 handle out-of-the-money option expired last Friday, December 12 - after the FOMC's widely anticipated third consecutive 25bp rate cut last Wednesday.
  • Most likely a hedge vs some short term balance sheet risk that corresponded to a rise in 30Y yield to (rough) appr 5.48% from 4.73% yield at the time of trade.

• RES 4: 1.3527 High Oct 1    
• RES 3: 1.3471 High Oct 17  
• RES 2: 1.3456 High Dec 16
• RES 1: 1.3452 61.8% retracement of the Sep 17 - Nov 4 bear leg
• PRICE: 1.3424 @ 16:19 GMT Dec 16
• SUP 1: 1.3342 Low Dec 12   
• SUP 2: 1.3284 50-day EMA
• SUP 3: 1.3180 Low Dec 2 
• SUP 4: 1.3125 Low Nov 26      

A bullish extension last week in GBPUSD confirmed a resumption of the current uptrend. Sights are on 1.3452 next (pierced), 61.8% of the Sep 17 - Nov 4 bear leg. Clearance of this hurdle would strengthen a bull theme and open 1.3527, the Oct 1 high. Initial firm support is seen at 1.3286, the 20-day EMA. A clear break of this average would highlight a bearish development and signal a possible reversal.

• The Wall Street Journal have published an article indicating that the White House consider China's new demand regarding a Panama Ports deal as unacceptable.
• "President Trump's push to loosen China's influence in the Panama Canal has hit a wall now that Beijing is demanding that China's largest shipping company get a controlling stake in a deal to sell dozens of ports to a BlackRock-led group."
• "The deal is now at an intractable impasse, people involved in the talks say. A senior Chinese official said that Beijing aims to make control of the ports a negotiating point in the U.S. and China's broader talks over trade and tariffs." (Wall Street Journal)