Pressure on Japanese government bonds is surging: Open interest in the front month of Japan’s 10Y government bond futures just hit 188,000 contracts, the highest since September 2024. The number of outstanding futures contracts that are still active has surged +65,000 since June. Since then, Japan’s 10Y bond futures have declined -2.6%, to 135, near the lowest since June 2008. During the same period, the 10Y government bond yield has risen +34 basis points, to 1.81%, the highest since June 2008. Rising open interest, along with falling prices, suggests a growing accumulation of short positions among investors. Japan's bond market is in trouble.(The Kobeissi Letter)