US Fixed Income Technical Analysis

By Ian Stannard

     LONDON (MNI) - US 5YR FUTURE TECHS: (U18) Weekly Close Key To Bullish

Outlook

*RES 4: 113-29.25  May 31 high

*RES 3: 113-28, 61.8% of 112.2925/114-1525

*RES 2: 113-26 Jul  6 high

*RES 1: 113-257 Aug 15 high

*PRICE: 113-222 @ 10:18 GMT 

*SUP 1: 113-147 50% Retracement of Recent Recovery  

*SUP 2: 113-127 Aug 6 high

*SUP 3: 113-045 Aug 8 low

*SUP 4: 112-305 Aug 1 Low

     The 5-year note is pushing higher, after bouncing from support in the

113-18 area. A weekly close above 113-22 would represent the highest since

mid-April and would confirm bullish momentum, and a sustained break above 113-25

opens the way to the May 31 high of 113-292. and in the event of a correction,

holding 113-147 would maintain the positive technical picture. 

     US 10-Year Future: U18

US 10YR FUTURE TECHS:(U18) Poised To Push Higher

*RES 4: 122-19 High Feb 2 (Continuation chart)

*RES 3: 121-13+ 200-dma

*RES 2: 121-03 High May 30

*RES 1: 120-18 High Aug 15

*PRICE: 120-13 @ 10:26 GMT

*SUP 1: 119-27 Former range top, now support

*SUP 2: 119-12 Hourly low Aug 8

*SUP 3: 119-02 Low Aug 1

*SUP 4: 118-29+ Low Jun 13

A weekly close at spot level would be the highest since the week ending April 6

and would keep the 10-year future`s bullish uptrend since late May on track to

continue. Immediate resistance comes in at Wednesday`s high of 120-18, with a

break through next resistance at 120-20 setting up a move to the May 30 high of

121-03. In a downside move, support comes in at the former range top at 119-27.

     US 30-Year Future: U18

     US 30YR FUTURE TECHS: (U18) Eyeing Summer Highs

*RES 4: 146-15 Top of 6-month trend channel 

*RES 3: 146-11 Jul 6 5-Month High

*RES 2: 145-09 76.4% retracement from 141-28/146-11

*RES 1: 145-02 Intraday high

*PRICE: 144-29  @10:33 GMT  

*SUP 1: 144-00 50 dma

*SUP 2: 143-22 Trendline resistance-turned-support

*SUP 3: 143-19 Top end of Jul 24-Aug 9 range

*SUP 4  141-27 Aug 1 low 

     After surging early Friday, the Long Bond future hit a three-and-a-half

week high of 145-02. That intraday level now represents next resistance, with

the uptrend remaining intact and momentum indicators not yet in overbought

territory. A move through there and the strong weekly close that would imply

would set up a further move to Jul 6's 5-month high at 146-11.

     US 10-Year Yield

     US 10-YEAR YIELD TECHS: Bearish Tests Ahead

*RES 4: 3.0540 - 18-Year Monthly chart Trendline

*RES 3: 2.9886 - 2.5 month trendline resistance, top of triangle

*RES 2: 2.9237 -  Aug 6 Low, Support-Turned-Resistance

*RES 1: 2.8987 - Beginning of 2.90 resistance area  

*PRICE: 2.8515  @ 10:44 GMT

*SUP 1: 2.8353 - Low Aug 15

*SUP 2: 2.8218 - Trendline support, bottom of triangle

*SUP 3: 2.8053 - Low Jul 6

*SUP 4: 2.7594 - Low May 30

The 10-year yield continues to look heavy on both the daily and weekly charts,

with the short- and long-term trends still bearish. After failing to gain any

traction in testing the 2.90 resistance area, the next support is at the week's

low of 2.8353. The main technical event to watch is a potential test of the

bottom of the triangle the contract has been trading in for the past four

months, coming in at just above 2.82. There is little resistance beneath, with

2.8053 next up.

--MNI London Bureau; +44-203-865-3820; email: Ian.Stannard@marketnews.com