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JGBs trade softer, with the 5-Year sector......>

JGBS: JGBs trade softer, with the 5-Year sector experiencing some modest
underperformance ahead of today's supply, super-long paper has also seen some
modest underperformance after the recent run of outperformance.
- There appears to be a mild degree of concern ahead of the auction owing to the
flatness of the 2-/5-Year yield differential, although the fact that the auction
represents the opening of a fresh JGB line should provide some support. The
sector also looks relatively unattractive, with the belly of the curve looking a
little rich.
- Futures also trade a touch softer, but have stuck to a tight range. Bulls look
to 151.02-19, where the 2018 & monthly highs are situated. Daily studies looking
to correct from modestly overbought levels and the lack of topside follow
through remain concerns for bulls. In saying that, bears still need a close
below 150.89 to signal a false break higher and return initial focus to
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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