Trial now

Scale Buyer 3Y Midcurve Puts


(U1)‌‌ Moves Back Into The Bull Channel


Expiries for Jul22 NY cut 1000ET (Source DTCC)

Sign up now for free access to this content.

Please enter your details below and select your areas of interest.

It has been a quiet Asia-Pac session in terms of broader news flow. We haven't seen much to drive the recent bid in the U.S. Tsy space, but e-minis are off best levels, with Bitcoin trading back below $30,000 for the first time since late June. We are always cautious when pointing to direct correlations with cryptocurrencies, but that could be at least a partial driver here. Also, the bid in the ACGB space could be providing another (modest) leg of support. T-Notes last -0-02 at 134-20, after tagging best levels of 134-21 in recent dealing, once again operating on healthy volume of ~125K. The belly of the cash curve has seen some modest outperformance, with the major benchmarks across the Tsy curve running little changed to 1.0bp richer into European hours.

  • JGB futures have stuck to the upper half of the overnight range for most of the Tokyo session, and last deal +15. The major cash JGB benchmarks have generally richened by 0.5-1.0bp, given the dynamic in core global FI markets & JGB futures overnight, with 10s moving back to their recent 0.01% low. Still, technical resistance for futures in the form of the July 9 high (152.59) remains untouched. The latest liquidity enhancement auction covering off-the-run 5- to 15.5-Year JGBs saw a soft cover ratio, although this didn't have much, if any, impact.
  • The Aussie bond space has drawn a modest bid from Westpac chief economist Bill Evans flagging the potential for the RBA to temporarily lift its bond purchases to A$6bn/week at its September meeting (and thus reverse its decision to taper to A$4bn/week), please see the earlier bullet for more details on Evans' comments. YM +5.0, XM +8.0. The 10- to 12-Year zone of the cash ACGB curve has outperformed.