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Underpinned By SNB Cut But Resistance Caps Rally

US TSYS
  • Cash Tsy yields sit 3-4.5bps lower, with the rally led by the belly, underpinned by a surprise 25bp cut from the SNB even if it hasn’t materially impacted near-term FOMC pricing.
  • TYM4 trades within 1-2 ticks of the day’s high of 110-24+ (+ 08+), with its increase capped for now having met resistance at 110-23 (20-day EMA). A further push higher could expose 111-01+ (50-day EMA) but moving average studies are in a bear-mode position with support at the bear trigger of 109-24+ (Mar 18 low).
  • Volumes are strong at 450k, with initial post-FOMC activity in Asia hours before an acceleration from typical trends with the SNB.
  • Today’s docket sees initial focus on data, mainly jobless claims, preliminary PMIs and existing home sales, before some attention on 10Y TIPS supply.
  • Data: Weekly jobless claims (0830ET), Philly Fed mfg index Mar (0830ET), Current account Q4 (0830ET), S&P prelim PMIs Mar (0945ET), Existing home sales Feb (1000ET), Leading index Feb (1000ET)
  • Fedspeak: VC Supervision Barr (1200ET, no text) but within blackout period
  • Note/bond issuance: US Tsy $16B 10Y TIPS auction reopen (1300ET)
  • Bill issuance: US Tsy $85B 4W, $85B 8W bill auctions (1130ET)

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