Long-end dips slightly with futures heavy in mostly quiet trading

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OVERNIGHT TREASURIES

•Long-end dips slightly with futures heavy in mostly quiet trading
•Slim 109k 10-year futures trade by 06:37 EST
•Small Middle Eastern selling front-end, other overseas buying of belly, domestic dealers sell long-end
•September 10s trade 134-23/134-15.5 overnight

MARKET BIAS

•The tactical bias is neutral/supportive anticipating more relatively low volume illiquid trading with few natural sellers about.
•Look for a range of 1.52%-to-1.44% in 10s.
•The strategic bias is flat, but has been patiently waiting for a move toward 1.55% (mid-Bollinger 1.57%) for better buy location.
•The curve bias is flat.

TECHNICAL OVERVIEW

DATA

•08:30 Initial Claims (wk July 14) (mkt 365k, prev 350k)
•08:30 — Continuing Claims (wk July 7) (mkt 3.300 mln, prev 3.304 mln)
•10:00 Existing Home Sales (Jun) (mkt 4.63 mln, prev 4.55 mln)
•10:00 Leading Indicators (Jun) (mkt -0.1% m/m, prev +0.3% m/m)
•10:00 Philly Fed Mfg Survey (Jul) (mkt -8.0, prev -16.6)

EVENTS

•11:00 Fed outright Treasury coupon purchase (02/15/2036 – 05/15/2042) (e: $1.50 – $2.00 bln)

ISSUANCE

•11:00 Treasury announces 3- and 6-month, 52-week bills (e: $32/29/26 bln)
•11:00 Treasury announces 2-, 5- and 7-year notes (e: $35/35/29 bln)
•13:00 Treasury auctions $15 bln 10-year TIPS

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