Highlights:
- Yields inch to new multi-month high ahead of early close
- Equity futures point to mixed open Tuesday
- UK markets close imminently, European bond markets closed all day
US TSYS: Tsys Inching Lower, 10Y Yield Climbs to 4.6048%, 7-Month High
- Christmas markets in full control: Treasuries are mildly lower at the moment, extending lows after narrow overnight range on extremely light volumes (TYH5 just over 110k).
- The Mar'25 10y contract trades 108-14.5 last (-0.5) - just through initial technical support of 108-16.5 (Dec 19 low). Focus on next support at 108-12.5 (1.382 proj of the Oct 1 - 14 - 16 price swing) followed by 108-00 (1.500 proj of the Oct 1 - 14 - 16 price swing ).
- Treasury 10Y yield tapping 4.6048% (+.0182) highest level since late May.
- Session data limited to regional Fed data: Philadelphia Fed Non-Mfg Activity at 0830ET, Richmond Fed Mfg Index at 1000ET.
- Treasury supply for the last minute shoppers: $28B 2Y FRN & $70B 5Y Note auctions at 1130ET.
- Early close at 1300ET for Christmas eve, full close tomorrow (Globex re-open Wednesday at 1800ET) - back to full session trade Thursday and Friday.
US 10YR FUTURE TECHS: (H5) Trend Needle Points South
- RES 4: 112-02 Low Oct 14
- RES 3: 111-20+ High 6 and the bull trigger
- RES 2: 110-28 50-day EMA
- RES 1: 110-03+ 20-day EMA
- PRICE: 108-23 @ 11:59 GMT Dec 24
- SUP 1: 108-13+ Low Dec 24
- SUP 2: 108-12+ 1.382 proj of the Oct 1 - 14 - 16 price swing
- SUP 3: 108-00 1.500 proj of the Oct 1 - 14 - 16 price swing
- SUP 4: 107-19+ 1.618 proj of the Oct 1 - 14 - 16 price swing
The trend condition in Treasury futures remains bearish, confirmed by the return lower on December 24th. For now, short-term gains are considered corrective. Last week’s sell-off reinforces the current bear cycle. The contract has traded through key short-term support and the bear trigger at 109-02+, the Nov 15 low. The breach confirms a resumption of the downtrend and opens 108+12+, a Fibonacci projection. On the upside, initial firm resistance is at 110-03+, the 20-day EMA.
TURKEY: MNI CBRT Preview – December 2024
- There are mixed views over whether the CBRT will commence its easing cycle or keep the one-week repo rate unchanged at 50%, though risks appear skewed towards the former.
- Dovish tweaks to the central bank’s language last month and insights from our EM Policy Team both point to a rate cut being delivered at the final meeting of the year.
- As per the Bloomberg survey, 18 out of 22 analysts expect a rate cut to be delivered, with estimates ranging from a cut of as small as 150bps to as large as 300bps.
See the full preview, with a summary of sell-side analyst views, here.
FOREX: Trend Structure in GBP/USD Remains Bearish
The trend structure in GBPUSD remains bearish and last week’s move lower reinforces current conditions. Key support at 1.2487, the Nov 22 low, was pierced on Dec 20. A clear breach of this level would confirm a resumption of the downtrend and open 1.2446.
- Bullish conditions in USDJPY remain intact and last week’s strong gains reinforce current conditions. The breach of 156.75, the Nov 15 high and a bull trigger, confirms a resumption of the uptrend and opens 159.45, the Jul 12 high.
- The trend needle in AUDUSD continues to point south and the pair is trading closer to its recent lows.Recent weakness maintains the price sequence of lower lows and lower highs.
- The Dollar is still on the front foot, at a new intraday high against the CAD, SEK, NOK, CNH, KRW, CNY, and CZK.
- Despite the small recovery in Oil, the NOK is still the worst performer in G10s against the Dollar, down 0.34%, and USDNOK now edges above Yesterday's high.
- Main resistance is still at the big Psychological level of 11.5000, managed a 11.4769 high last Week, its highest since March 2020.
Of note:
EURUSD 1.31bn at 1.0400 (fri).
- EURUSD: 1.0400 (590mln).
- USDJPY: 157.00 (431mln).
- USDCNY: 7.2814 (600mln).
COMMODITIES: Copper Gains Alongside US Equity Futures
| WTI Crude up $0.41 or +0.59% at $69.62 |
| Natural Gas up $0.07 or +1.91% at $3.719 |
| Gold spot up $4.96 or +0.19% at $2617.59 |
| Copper up $2.75 or +0.67% at $410.9 |
| Silver down $0.07 or -0.22% at $29.5901 |
| Platinum up $1.65 or +0.18% at $943.56 |
EQUITIES: US Futures Point to Mildly Higher Open
| Japan's NIKKEI closed lower by 124.49 pts or -0.32% at 39036.85 and the TOPIX ended 0.52 pts higher or +0.02% at 2727.26. |
| Elsewhere, in China the SHANGHAI closed higher by 42.271 pts or +1.26% at 3393.528 and the HANG SENG ended 215.16 pts higher or +1.08% at 20098.29. |
| Dow Jones mini up 23 pts or +0.05% at 43342, S&P 500 mini up 7.25 pts or +0.12% at 6042.75, NASDAQ mini up 37.25 pts or +0.17% at 21789. |
| Date | GMT/Local | Impact | Country | Event |
| 24/12/2024 | 1330/0830 | ** |  US | Philadelphia Fed Nonmanufacturing Index |
| 24/12/2024 | 1355/0855 | ** | US | Redbook Retail Sales Index |
| 24/12/2024 | 1500/1000 | ** | US | Richmond Fed Survey |
| 24/12/2024 | 1630/1130 | * | US | US Treasury Auction Result for 5 Year Note |
| 24/12/2024 | 1630/1130 | ** | US | US Treasury Auction Result for 2 Year Floating Rate Note |