Market Roundup: US$ Surge, Break Pandemic Peak

FI futures traded firmer after huge miss in March goods trade balance: record deficit of -125.3B vs -106.3B expected. While exports climbed 7.2%, imports surged 11.5% MoM.

• Still inside the overnight range as 30s extended session highs (USM 143-09) is scaling back support at the moment, yield curves steepening off lows: 2s10s -0.841 at 23.063 vs. 16.995 low.
• Markets watching surge in US$ strength, DXY $ index +.737 at 103.040, 5-year highs as it breaches start of pandemic peak of around 102.992.
• Confluence of likely drivers: ongoing adjustment in Fed tightening cycle - rush to neutral, safe haven, month-end, and knock on efforts from PBoC to counter CNY strength/promote domestic growth all amid lack of market depth.
• Technicals: Recent gains still considered corrective and the primary downtrend remains intact. Moving average studies continue to point south and fresh cycle lows last week confirmed a resumption of the primary downtrend and an extension of the price sequence of lower lows and lower highs.
• Tsy Jun 10Y futures (TYM2) currently at 120-08 vs. 120-18.5 high. First support at 118-08 Low Apr 22 and the bear trigger. TYM2 resistance at 120-19.5 20-day EMA.