HALISTER1: UST MORNING CALL: Crude in Focus; Market Lacking Direction

UST MORNING CALL: Crude in Focus; Market Lacking Direction

(Bloomberg) -- Early risk-off rally in USTs has evaporated as WTI crude pares initial losses that followed Doha talks.
  • Watch energy declines closely; falling prices for spot WTI crude should have limited impact on 5Y5Y inflation swaps, though these lvls are important for the Fed, RBS’s John Briggs writes in a client note
  • CFTC data as of April 12 show $13.6b drop in Specs net short positions, having amassed largest shorts since Jan.; largest drop in TY (-$8.2b), asset managers continued to reduce TY (-$4b), WN (-$10b) positions, Nomura’s George Goncalves writes in client note
  • Treasury market lacks direction, positioning surveys show bias toward neutral duration; little market response to releases that were once market moving events, CRT’s David Ader and Ian Lyngen write in client note
    • Impact of key macroeconomic data has decreased meaningfully over recent months, writes BofAML in client note: MORE
  • NOTE: UST 5s30s Flattening Dynamics Supported in Risk-Off: Charts
  • 10Y note-futures technicals (roll-adjusted):
  • Resistance 130-28 (61.8% Fibo of April 7-14 fall), 131-01 (76.4% Fibo), 131-07 (April 11 high)
  • Support 130-15 (April 15 mid price), 130-06 (April 14 low)
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
John Briggs (RBS Securities Inc)
David Ader (CRT Capital Group LLC)
George Goncalves (Nomura Holdings Inc)
Ian Lyngen (CRT Capital Group LLC)

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