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4 Feb 2015
Technical outlook for treasuries – RBS
FXStreet (Barcelona) - Analysts at RBS give the technical outlook for 2s, 5s and 10s treasuries.
Key Quotes
“Treasuries are modestly higher as Oil loses gains before today's US inventory data which may show inventories at their highest level in over three decades.”
“Overnight inter-dealer Treasury volume (4pm to 6am) was 133% of the 10-day average volume for the overnight session.”
“I expect the tug of war between the entrenched rate bulls and opportunistic bond sellers to continue in Treasuries and for the same bumpy ride to persist in other, similarly over-stretched asset classes like the US dollar, oil/gas, UK gilts, US TIPS and US 5y5y inflation expectations.”
“2s (0.502%)– Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.40% where we'd close a gap left behind in late October. Daily momentum is bearish.”
“5s (1.278%)– Next major support comes in at 1.80% and just above. Nearby resistance lines up at ~1.155%. Daily momentum is now bearish after yesterday's heave-ho.”
“10s (1.776%)–Next major resistance comes in at ~1.60%, the May 2013 'lows'. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is now bearish.”
Key Quotes
“Treasuries are modestly higher as Oil loses gains before today's US inventory data which may show inventories at their highest level in over three decades.”
“Overnight inter-dealer Treasury volume (4pm to 6am) was 133% of the 10-day average volume for the overnight session.”
“I expect the tug of war between the entrenched rate bulls and opportunistic bond sellers to continue in Treasuries and for the same bumpy ride to persist in other, similarly over-stretched asset classes like the US dollar, oil/gas, UK gilts, US TIPS and US 5y5y inflation expectations.”
“2s (0.502%)– Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.40% where we'd close a gap left behind in late October. Daily momentum is bearish.”
“5s (1.278%)– Next major support comes in at 1.80% and just above. Nearby resistance lines up at ~1.155%. Daily momentum is now bearish after yesterday's heave-ho.”
“10s (1.776%)–Next major resistance comes in at ~1.60%, the May 2013 'lows'. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is now bearish.”