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Bonds Extending Lows

US TSY FUTURES
  • Treasury futures are extending early session lows at the moment, no obvious headline, data or Block/cross driver as weaker bonds lead curve steepening (3M10Y +3.815 at -115.243, 2Y10Y +2.896 at -66.323).
  • Incoming high-grade supply and pre-auction hedging only a factor in the short end to 3s. Some desks are of the opinion that Fed Chairman Powell will present a hawkish or "stay the course" to address inflation at the KC Fed's annual economic symposium in Jackson Hole, WY that kicks off Thursday evening and runs through Saturday.
  • Technicals in play: Treasury 10Y futures nearing round number support of 109-00, currently marking 109-05.5 low (-15), yield back up to 4.3260% high. Compares top last Thursday low of 109-03.5.
  • The move down signals scope for 108-26 next, the Oct 21 2022 low (cont). Moving average studies are in a bear mode condition, highlighting a downtrend.

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