US TSYS: Tsys Whipsaw Lower, Risk Sentiment Tested on Policy & Trade

• RES 3: 95.995 - 1.618 proj of the Sep 3 - 9 - 10 price swing
• RES 2: 95.865 - 1.000 proj of the Sep 3 - 9 - 10 price swing
• RES 1: 95.780 - High Sep 12
• PRICE: 95.735 @ 20:26 BST Sep 15
• SUP 1: 95.510 - Low Sep 3  
• SUP 2: 95.415/95.300 - Low May 15 / Low Jan 14 
• SUP 3: 95.275 - Low Nov 14  (cont) and a key support

Aussie 10-yr futures are trading closer to their recent highs and a short-term bull cycle remains in play. Short-term resistance to watch is last week’s 95.780 high on Sep 12. A break of this level would signal scope for a continuation higher and pave the way for a climb towards 95.865, a Fibonacci projection. Key short-term support has been defined at 95.510, the Sep 3 low.

• Slower moving indicators also still carry weight as the FOMC assesses broader labor market balance.
• The JOLTS report for July was softer than expected, primarily on the openings front as the ratio of vacancies to unemployed fell to a new recent low.
• Powell at Jackson Hole had pointed to this metric in the category of little changed to only modestly softer over the past year, leaving sensitivity to any subsequent declines here.
• Specifically, the ratio of openings to unemployed fell from 1.05 to 0.99. Whist only marginal at this stage, that’s the first time there have been fewer openings than unemployed since Apr 2021 or, prior to the pandemic, early 2018.
• The quit rate meanwhile was unchanged at 2.01%, continuing to stabilize at low levels having averaged 2.0% since Aug 2024, and actually a little above some 1.9% readings in 2H24 rather than pushing lower still. 

• As for other timely measures of labor market conditions, weekly jobless claims data have painted a mixed picture.
• The latest initial jobless claims print has fired a warning shot with a surprisingly steep rise to 263k for its highest since 2021, although a large part of this increase was driven by what’s an idiosyncratic-looking increase in Texas. Being the second largest state in the US it shouldn’t be completely looked past, but it does add an asterisk next to the latest spike in what can be noisy data week-to-week.
• Our continued preference is to focus on the four-week average although this too shows an upward trend, now at 241k for a 20k increase since August and its highest since June. We’d start to take a stronger signal of impending labor market weakness if this rate starts to push above 250k in what would break ranges seen over the past two years.
• Continuing claims meanwhile have very roughly plateaued ever since a more concerted push higher back in May and June, a finding that coincidentally tallies with June being the weakest print for payrolls growth as the data currently stand.