EU CREDIT SUPPLY: Vodafone Tendered Line Levels

• RES 4: 111-20+ High 6 and the bull trigger 
• RES 3: 110-25   High Dec 12   
• RES 2: 110-04   50-day EMA  
• RES 1: 109-04+ 20-day EMA
• PRICE:‌‌ 108-02+ @ 11:49 GMT Jan 08
• SUP 1: 108-01+ Low Jan 7 
• SUP 2: 108-00   1.500 proj of the Oct 1 - 14 - 16 price swing   
• SUP 3: 107-19+ 1.618 proj of the Oct 1 - 14 - 16 price swing
• SUP 4: 107-04   1.764 proj of the Oct 1 - 14 - 16 price swing

The trend condition in Treasury futures is unchanged and remains bearish. Tuesday’s fresh cycle low confirms a resumption of the downtrend and the contract is approaching the next objective at 108-00, a Fibonacci projection. Note too that moving average studies remain in a bear-mode position highlighting a dominant downtrend. Key short-term resistance is seen at 109-04+, the 20-day EMA.

Treasuries have sold off over the past hour as US desks join, lagging sharp downward pressure in Gilts after long end yields broke to fresh multi-decade high. CNN has more recently reported Trump is weighing an emergency declaration for new tariffs with TY futures mostly sideways since then. 

• Today’s 30Y supply can also weigh, but with the recent large steepening offering strong outright concession (WI yield currently ~40bps above last month’s auction high yield).
• Cash yields are 1-2bp higher, bear steepening with 2s10s setting new recent highs of 40.6bps.
• 10Y yields have recently seen a session high of 4.7014%, with focus on 4.7351%, the 2024 high.
• 30Y yields at 4.936% earlier hit fresh highs since Oct/Nov 2023.
• TYH5 trades at 108-03 (-02+) whilst cumulative volumes of 370k are reasonable but not particularly elevated.
• The earlier low of 108-01+ matched yesterday’s fresh cycle low, and sees attention on the round 108-00 before 107-19+ (both Fibo projections). Moving average studies remain in a bear-mode position highlighting a dominant downtrend.
• Data: Headlined by weekly jobless claims brought forward a day early plus ADP employment.
• Fedspeak: Waller (0800ET), FOMC minutes (1400ET) – see STIR bullet.
• Note/bond issuance: US Tsy $22B 30Y re-open - 912810UE6 (1300ET)
• Bill issuance: US Tsy $64B 17W bill auction (1130ET)