Market Roundup: Post-Data Bear Flattening

Rates still weaker after higher than expected April inflation data, reversals pauses with some two-way last few minutes with fast$ buying 10s. Heavy front end selling (2YY taps 2.7276% high vs. 2.6124% late Tue) on prospect of renewed hawkishness from the Fed to combat inflation.

• Yield curve volatility at the moment, flatter but off lows: 2s10s -4.544 at 32.892 vs. 28.372 low; 5s30s holding off inversion for the moment at 5.4684 (-1.750) vs. 2.519 low.
• US 10Y technicals: primary downtrend remains intact and the recovery from Monday’s low is considered corrective. Recent fresh cycle lows confirmed a resumption of the downtrend and an extension of the price sequence of lower lows and lower highs.
• Furthermore, recent corrections have tended to be shallow and this highlights bearish sentiment. June 10Y futures trading 118-07 (-18) with key support at 117-08+ (Low May 9 and the bear trigger). Below that, attention on 116-28, a Fibonacci projection. Key resistance is 120-18+, Apr 27 high.
• Cross-assets: WTI Crude Oil (front-month) holding gains +$3.10 at $102.86; while support in Gold evaporates, currently at $1839.00.