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CROSS ASSET

USD Hits New Daily Lows vs. EUR, GBP, AUD

US TSY FUTURES

BLOCK, 5Y

US TSYS

Tsys Pare Gains on Equity Upswing

PLATINUM

Death Cross Approaches in Platinum

EQUITY TECHS

E-MINI S&P (U1): Heading North

CORN TECHS

(Z1) Attention Is On Support

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Risk-off tone surged Monday: Tsy futures surged on heavy volumes (TYU1 >2M ) by the close while equities sold off sharply (S&Ps -2.08% in late trade).
  • Of the various drivers for bid -- global spd of covid delta variant, spike in case counts spurring safe haven buying in EGBs, GBP, Tsys. Note: CDC raised covid related warning to level 4 (highest) to those traveling to the UK even as UK drops virus restrictions. Economic data remains light on wk, Fed in blackout.
  • TYU hit high of 134-25.5 well through bull-channel top of 134-03 and 200% fibonacci projection (134-24.5). 10YY fell to 1.739% low, well through 200DMA on move back to mid-Feb levels. Yield curves bull flattened vs. intermediates while longer curves outperformed (5s30s 112.098 late vs 110.188L).
  • Early on, sources report prop, real$ and foreign bank buying in 5s-30s, fast$ selling bonds and taking stab at entering steepeners vs. intermediates. Mid- to late morning Flow included ongoing real$, foreign and domestic bank buying in 5s-30s, stops triggered on latest move. Fast$ unwinding tactical shorts.
  • The 2-Yr yield is down 1.6bps at 0.2055%, 5-Yr is down 8.7bps at 0.6867%, 10-Yr is down 11.5bps at 1.1756%, and 30-Yr is down 11.1bps at 1.8083%.