US TSYS: DO YA WANNA DEAL OR NOT?

US TSY SUMMARY: Quiet end to a hectic headline-risk driven week. Revering

overnight bid, sell momentum gained early NY trade, breached late Thu lows react

to nebulous trade headlines such as WH" very optimistic will reach a trade deal

with China soon." 

- Despite heavy volume by midmorning (TYZ>1M) mkts remained very skittish

w/algo's easily triggered by trade headlines. Tsys gaped off lows as Trump said

he hadn't agreed to tariff rollback to seal phase 1 deal (early hawkish trade

comments from WH Nevarro largely ignored).

- Additional support partially driven by Global Times editor tweet, excerpt:

"What's certain is that if there's no rollback of tariffs, there will be no

phase 1deal." In derivatives, downside put skew that surged yesterday is seeing

gain in call skew as underlying gains ground.

- Two-way flow, position squaring ahead extended holiday weekend, Dec/Mar Tsy

roll gradually picking up. Early Eurodlr Block +7k Red packs (EDZ0-EDU1). 

- The 2-Yr yield is down 0.5bps at 1.662%, 5-Yr is up 0.1bps at 1.7307%, 10-Yr

is up 1bps at 1.9277%, and 30-Yr is up 1.7bps at 2.414%.

TECHNICALS:

US 10YR FUTURE TECHS: (Z9) End Of A Bearish Week

*RES 4: 130-02+ Trendline resistance drawn off Oct 8 high

*RES 3: 129-28 50-Day EMA

*RES 2: 129-12+ High Nov 6

*RES 1: 128-27+ Low Nov 5 and former breakout point

*PRICE: 128-15+ @ 17:35 GMT, Nov 8

*SUP 1: 127-31+Intraday low

*SUP 2: 127-27 Projected bear channel base drawn off Sep 3 high

*SUP 3: 127-06+ 1.236 progression of Sep 3 - Sep 13 decline from Oct 4 high

*SUP 4: 126-20+ 1.382 progression of Sep 3 - Sep 13 decline from Oct 4 high

10yr futures remain vulnerable following the recent sell-off. The key technical

break on Nov 7 was the move below the former key support of 128-16, Sep 13 low.

The breach of this support adds fuel to the current trend and note, prices did

also penetrate the 128-00 objective. This has paved the way for weakness towards

127-27 next, the base of a bear channel drawn off the Sep 3 high. Initial

resistance is at 129-12+.

AUSSIE 3-YEAR TECHS: (Z9) Bearish Pressure Remains

*RES 4: 99.315 - High Oct 25

*RES 3: 99.240 - High Oct 31and key near-term resistance

*RES 2: 99.180 - Bear channel resistance drawn off Oct 10 high

*RES 1: 99.165 - High Nov 7

*PRICE: 99.1200 @ 17:37 GMT Nov 8

*SUP 1: 99.070 - Low Nov 8

*SUP 2: 99.055 - 1.000 projection of Oct 8 - Oct 22 decline from Oct 25 high

*SUP 3: 99.015 - Low Bear channel base drawn off Oct 10 high

*SUP 4: 98.994 - 1.236 projection of Oct 8 - Oct 22 decline from Oct 25 high

Aussie 3yr is set to maintain a bearish theme following last weeks sell-off. The

result of the move lower was a break of former key support at 99.075, Sep 16

low. This reinforces the bearish theme as well as the bearish price sequence of

lower lows and lower highs that has developed since the reversal off the Oct 7

high. The focus is on the base of the bear channel at 99.015, drawn off the Oct

10 high. Resistance is at 99.165, Nov 7 high.

AUSSIE 10-YEAR TECHS: (Z9) Downtrend Intact

*RES 3: 98.8371 - Bear channel resistance drawn off Oct 9 high

*RES 2: 98.8100 - Low Oct 22 and former breakout point

*RES 1: 98.7950 - High Nov 7

*PRICE: 98.7050 @ 18:39 GMT, Nov 8

*SUP 1: 98.6500 - Low Nov 8

*SUP 2: 98.6135 - Bear channel base drawn off Oct 9 high

*SUP 3: 98.6100 - 1.000 projection of Oct 8 - Oct 22 decline from Oct 25 high

Aussie 10yr is set to maintain a bearish tone following last weeks slide. The

result of the move lower was a breach of key support at 98.7675, Sep 16 low.

This marked an important bearish break and reinforces the clear bearish price

sequence of lower lows and lower highs that defines the current downtrend.

Attention is 98.6135 next, the base of a bear channel drawn off the Oct 9 high.

Resistance is located at 98.7950, Nov 7 high.

JGB TECHS: (Z9): Likely To Extend The Downside

*RES 3: 153.93 - High Nov 6

*RES 2: 153.62 - Low Seo 17 and former breakout point

*RES 1: 153.27 - High Nov 8 

*PRICE: 152.90 @ 17:42 GMT, Nov 8

*SUP 1: 152.55 - Low Nov 11

*SUP 2: 152.39 - 1.618 projection of Sep 4 - Sep 17 decline from Sep 25 high

*SUP 3: 152.11 - 1.764 projection of Sep 4 - Sep 17 decline from Sep 25 high

JGB futures remain bearish following last weeks sharp slide, a week that saw

important support levels cleared, the most recent being the break of the Sep 17

low of 153.62 on Nov 6. A clear bearish price sequence of lower lows and lower

highs prevails too. Attention is now on the next objectives at 152.39 and

152.11, both Fibonacci projection targets. Initial resistance is seen at 153.27,

Nov 8 high. Look for the downside to extend. 

US TSY FUTURES CLOSE: Quiet end to a hectic week, Tsy futures mixed by the bell,

yld curves steeper again w/2s-10s outperforming. Update:

* 3M10Y  +2.013, 37.594 (L: 32.333 / H: 39.778)

* 2Y10Y  +1.938, 26.336 (L: 22.859 / H: 27.035)

* 2Y30Y  +2.377, 74.859 (L: 69.649 / H: 75.136)

* 5Y30Y  +1.608, 68.066 (L: 64.342 / H: 68.398)

Current futures levels:

* Dec 2-Yr futures up 0.625/32  at 107-16.25 (L: 107-14.25 / H: 107-17.875)

* Dec 5-Yr futures up 0.75/32  at 118-5.25 (L: 117-31.75 / H: 118-11)

* Dec 10-Yr futures steady at  at 128-12.5 (L: 128-03.5 / H: 128-22)

* Dec 30-Yr futures down 7/32  at 156-14 (L: 156-01 / H: 157-07)

* Dec Ultra futures down 21/32  at 181-8 (L: 180-26 / H: 183-03)

US TSY FUTURES: *** Late roll update: Dec futures don't expire until mid-late

December (10s, 30s and Ultras on 12/19, 2s & 5s 12/31) -- Dec/Mar rolling

starting to occur ahead first notice (where March futures take lead quarterly

position) only three weeks away (Nov 29). Update:

* TUZ/TUH appr 26,200 from -5.0 to -4.5, -4.88 last; 8% complete

* FVZ/FVH appr 21,900 from -8.75 to -8.0, -8.5 last; 5% complete

* TYZ/TYH appr 12,900 from 0.75 to 1.75, 1.0 last; 6% complete

* UXYZ/UXYH <100 -1-10.25 last

* USZ/USH appr 8,100 from 26.25 to 27.25, 26.75 last; 1% complete

* WNZ/WNH appr 1,400 from 24.75 to 25.0. 25.0 last; 1% complete

US EURODLR FUTURES CLOSE: Near steady in the wings to mildly higher in

Reds-Blues, near middle of narrow range -- a quiet end to a hectic week. Current

White pack (Dec 19-Sep 20): 

* Dec 19 -0.005 at 98.085

* Mar 20 steady at 98.275

* Jun 20 +0.005 at 98.335

* Sep 20 +0.010 at 98.380

* Red Pack (Dec 20-Sep 21) +0.010 to +0.015

* Green Pack (Dec 21-Sep 22) +0.010 to +0.015

* Blue Pack (Dec 22-Sep 23) +0.005 to +0.010

* Gold Pack (Dec 23-Sep 24) steady to +0.005

US DOLLAR LIBOR: Latest settles

* O/N -0.0050 at 1.586% (-0.0535/wk)

* 1 Month +0.0010 to 1.7590% (-0.0153/wk)

* 3 Month -0.0008 to 1.9006% (+0.0100/wk)

* 6 Month +0.0004 to 1.9230% (+0.0205/wk)

* 1 Year +0.0168 to 1.9998% (+0.0746/wk)

STIR: Federal Reserve Bank of New York EFFR for prior session:

* Daily Effective Fed Funds Rate: 1.56%, volume: $76B

* Daily Overnight Bank Funding Rate: 1.55%, volume: $168B

US TSYS: REPO REFERENCE RATES: (rate, volume),

* Secured Overnight Financing Rate (SOFR): 1.56%, $1.066T

* Broad General Collateral Rate (BGCR): 1.53%, $449B

* Tri-Party General Collateral Rate (TGCR): 1.53%, $427B

OUTLOOK: *** US Data/speaker calendar (prior, estimate):

12-Nov 0600 Oct NFIB Small Business Index (101.8, 102.0)

12-Nov 0855 09-Nov Redbook retail sales m/m

12-Nov 1100 Nov NY Fed expectations survey

12-Nov 1200 Pres Trump, Economic Club of NY

12-Nov 1300 Phil Fed Pres Harker on economy and Fed, Q&A 

12-Nov 1800 Minn Fed Pres Kashkari moderated discussion, Cntr for Research/Wisc

Economy

PIPELINE: Issuance stalls second half of wk after $24.7B priced Mon-Wed. Focus

on next wk's AbbVie jumbo issuance.

Date $MM Issuer/Rating/Desc/Maturity/Yld; Priced *; Launch #:

11/?? Chatter: AbbVie jumbo issue next week, rumored to be around $28B (would

make 4th largest issue on record). Seems excessively high as last year, AbbVie

issued $6B on 09/13: 1.25B 3Y +60, $1.25B 5Y +90, $1.75B 10Y +138, $1.75B 30Y

+183.

11/?? Chatter: Sprint

11/?? Chatter: T-Mobile US

11/08 Nothing in pipeline Friday; $24.7B/wk

--

11/07 Nothing priced Thursday 

Eurodollar/Tsy options: 

Eurodollar Options

* +10,000 Dec 81 calls, 2.5

* -6,000 Green Dec/Blue Dec 80 put strips vs. 12,000 short Dec 80 puts, 2.0 net

* +10,000 Dec 81 calls, 2.75 on screen

* +5,000 Gold Jun 92/97 call spds, 1.5

* -4,000 Sep 75/78 3x1 put spds, 0.0

* +17,500 Jun 90/92 call spds 1.0 vs. 98.31/0.05

* -5,000 Red Mar 92/97 1x2 call spds, 3.0

* -3,000 Jan 85/87 call spds w/-6,000 Mar 85/87 call spds, 5.0 total

adds to 60k package bought yesterday

* -50,000 short Dec 92/97 call spds, 0.75 vs.

* +50,000 short Red Dec'20 92/97 call spds, 5.0

Block, 0723-0756ET,

* total -28,000 Dec 82 calls, 1.0

Block, 0720:42ET,

* 7,500 Dec 81/Feb 85 calls, 0.0 +Jan

Tsy options:

* 11,500 TYH 128.5 calls, 1-10/64 vs. 128-14.5/0.48%

Block, 1053:30ET,

* -10,000 TYF 127/130 combos, 1/64 vs. 128-16/0.42%, put over

* +6,000 FVF 118.5 calls, 29.5/64 vs. 118-13.5

* 5,300 FVZ 116.25 puts, 2/64 on screen

* 2,500 TYZ 127.5/129.5 put spds, 53/64 vs. 128-07.5

* -2,500 TYF 127 puts, 27/64

--MNI Chicago Bureau; tel: +1 312-431-0089; email: bill.sokolis@marketnews.com

[TOPICS: MTABLE,M$U$$$,M$$FI$,MN$FI$,MN$FX$]