US TSYS: TYH6 Close To Resistance With ADP, ISM Services and JOLTS Ahead
Treasuries have firmed overnight, mainly in London hours, in a further reversal off yesterday’s lows with assistance from soft European data. The WSJ reported that Secretary of State Rubio told lawmakers that recent administration threats against Greenland didn’t signal an imminent invasion and that the goal is to buy the island from Denmark.
- Cash yields are 0.5-4.2bp lower on the day, with declines led by the long-end.
- 30Y yields trade at 4.823% for a sizeable pullback after briefly testing the 4.88% level three times yesterday.
- TYH6 trades close to session and week highs of 112-18 (+07) on reasonable cumulative volumes of 325k.
- It comes close to resistance at 112-19+ (50-day EMA) after which lies 112-25+ (Dec 30/31 high) as it shifts away from support at 112-01+ (Dec 23 low) and 111-29 (Dec 10 low, bear trigger).
- Data: MBA mortgage applications (0700ET), Monthly ADP Dec (0815ET), Chicago Fed CARTS (0830ET), ISM services Dec (1000ET), JOLTS Nov (1000ET), Factory orders Oct (1000ET),
- Fedspeak: Bowman on banking supervision (1610ET, text + Q&A)
- Bill issuance: US Tsy $69B 17W bill auction (1130ET)
- Politics: Press briefing by WH Press Sec Leavitt and other cabinet officials (1100ET), Trump signs Executive Orders (1430ET)
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OUTLOOK: Price Signal Summary - Recent USDJPY Weakness Still Appears Corrective
- In FX, a bullish theme in EURUSD remains intact. Gains last week resulted in a breach of key short-term resistance at 1.1656, the Nov 13 high and a bull trigger. The move higher highlights a potential reversal and opens 1.1694 next, the 50.0% retracement of the Sep 17 - Nov 5 bear leg. Clearance of this retracement point would strengthen the developing bull theme. On the downside, initial support to watch is 1.1601, the 20-day EMA. A breach of it would be bearish.
- A bull theme in GBPUSD remains intact and the pair is holding on to its recent gains. The breach of resistance around the 50-day EMA, at 1.3264, undermines a recent bearish theme and highlights a stronger reversal. This paves the way for an extension towards 1.3452, 50.0% retracement of the Sep 17 - Nov 4 bear leg. Initial firm support is seen at 1.3226, the 20-day EMA.
- Recent weakness in USDJPY is considered corrective. The deeper retracement has allowed an overbought condition to unwind. An extension lower would expose the 50-day EMA at 153.49 and the next important support. Moving average studies remain in a bull-mode position, highlighting a dominant medium-term uptrend. A resumption of the trend would open 158.00.
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SOFR: Mix Of Net Short Setting & Long Cover In Futures On Friday
OI data points to net short setting dominating in the white, green and blue SOFR packs on Friday, while net long cover was more prominent in the reds as most SOFR futures ticked lower on the day.
| 05-Dec-25 | 04-Dec-25 | Daily OI Change |
| Daily OI Change In Packs |
SFRU5 | 1,302,569 | 1,303,410 | -841 | Whites | +55,934 |
SFRZ5 | 1,603,394 | 1,590,932 | +12,462 | Reds | -4,299 |
SFRH6 | 1,430,509 | 1,388,938 | +41,571 | Greens | +26,517 |
SFRM6 | 1,148,072 | 1,145,330 | +2,742 | Blues | +9,500 |
SFRU6 | 1,081,547 | 1,080,245 | +1,302 |
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SFRZ6 | 1,104,360 | 1,120,049 | -15,689 |
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SFRH7 | 855,810 | 836,729 | +19,081 |
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SFRM7 | 770,549 | 779,542 | -8,993 |
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SFRU7 | 834,190 | 818,379 | +15,811 |
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SFRZ7 | 850,283 | 845,239 | +5,044 |
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SFRH8 | 446,954 | 441,690 | +5,264 |
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SFRM8 | 404,177 | 403,779 | +398 |
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SFRU8 | 380,155 | 381,784 | -1,629 |
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SFRZ8 | 319,892 | 321,438 | -1,546 |
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SFRH9 | 201,582 | 195,315 | +6,267 |
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SFRM9 | 217,512 | 211,104 | +6,408 |
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