18 Feb 2015
Technical outlook for Treasuries – RBS
FXStreet (Barcelona) - The Research Team at RBS comments on the bond market and further shares the technical outlook for 2s, 5s and 10s treasuries.
Key Quotes
“Treasuries are mixed and the curve has pivoted flatter as hopes grow for a Greek deal.”
“EU peripheral spreads are tighter and global stock markets are higher as 'risk-on' sentiment takes hold.”
“UK 10y Gilts have cheapened nearly 6bp after the BOE suggested that inflation could rise quickly toward target in 2016 as energy's impact fades and employment picks up, raising labor cost pressures.”
“Our overnight US rates flows saw Yen-based real$ selling in 5's and buying in 10's along with European real$ selling in both 10's and 30's.”
“In Swaps, we had real$ paying in 10's.”
“Overnight inter-dealer Treasury volume (4pm to 6am) was just 86% of the 10-day average volume for the overnight session.”
“2s (0.684%)– Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.40% where we'd close a gap left behind in late October. Daily momentum is mixed and oversold.”
“5s (1.64%)– Next major support comes in at 1.80% and just above. Nearby resistance lines up at ~1.155%. Daily momentum is still bearish but getting oversold now.”
“10s (2.16%)–Next major resistance comes in at ~1.60%, the May 2013 'lows'. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is still bearish but into oversold readings.”
Key Quotes
“Treasuries are mixed and the curve has pivoted flatter as hopes grow for a Greek deal.”
“EU peripheral spreads are tighter and global stock markets are higher as 'risk-on' sentiment takes hold.”
“UK 10y Gilts have cheapened nearly 6bp after the BOE suggested that inflation could rise quickly toward target in 2016 as energy's impact fades and employment picks up, raising labor cost pressures.”
“Our overnight US rates flows saw Yen-based real$ selling in 5's and buying in 10's along with European real$ selling in both 10's and 30's.”
“In Swaps, we had real$ paying in 10's.”
“Overnight inter-dealer Treasury volume (4pm to 6am) was just 86% of the 10-day average volume for the overnight session.”
“2s (0.684%)– Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.40% where we'd close a gap left behind in late October. Daily momentum is mixed and oversold.”
“5s (1.64%)– Next major support comes in at 1.80% and just above. Nearby resistance lines up at ~1.155%. Daily momentum is still bearish but getting oversold now.”
“10s (2.16%)–Next major resistance comes in at ~1.60%, the May 2013 'lows'. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is still bearish but into oversold readings.”