* Resistance for 10-year yield at 3.5-3.6 percent * Fed buyback at the long end due By Ellen Freilich NEW YORK, Dec 17 (Reuters) - U.S. Treasuries prices traded little changed on Friday with the longer maturities tending to outperform ahead of Federal Reserve purchases due later at that part of the curve. The Fed is due to buy $1.5 billion to $2.5 billion in long-dated Treasuries maturing August 2028 to November 2040. Benchmark yields hovered near seven-month highs. The yield curve also remained steep, partly a reflection of domestic fiscal and inflation concerns. Ten-year notes were unchanged in price, their yields at 3.42 percent. The 30-year bond was down 3/32, its yield at 4.53 percent. The market appeared torn between the lure of lower prices and higher yields and concerned that yields could move still higher if the economy improves next year. One analyst said bonds could rally in coming months, pushing yields 50 basis points to 75 basis points lower. In such a scenario, current levels would constitute a buying opportunity. "We may have seen the interim highs," said David Ader, senior government bond strategist at CRT Capital Group in Stamford, Connecticut, who saw a 50- to 75-basis-point rally over the next few months, led by ten-year notes. "The caveat remains liquidity and the need for people simply to keep risk and balance sheets down, making a $1 billion sale of anything (ETF redemptions come to mind) trade like a $10 billion liquidation," he said. From the flow perspective, purchases by the Fed at the long end are set for today, and five buybacks are compressed into three illiquid trading days next week, Ader observed. Meanwhile, rate-lock selling will fade as the Christmas holiday nears. The Treasury has no note sales next week. Technicals also argued for some buying, including a "double top" in 10-year yields at 3.56 percent. "The December rate increase of 80 basis points looks obviously excessive," said John Spinello. chief fixed-income technical strategist at Jefferies & Co in New York. "However, so did the 60-basis-point rise as of 3 p.m. on Wednesday. After a hefty helping of economic reports this week, the data calendar on Friday is light, with only the Conference Board's leading economic indicators due. Traders said less liquidity going into year-end could exaggerate moves. "But liquidity works both ways and the flow/technical perspectives suggest the next thrust is to lower yields," Ader said. Also supportive for U.S. government debt was a fall in UK confidence to a 20-month low and a sharp downgrade of Ireland debt. "The mortgage sellers, foreign sellers, corporate switching and sheer fear of lower prices in the dealer community culminated at noon yesterday, and we can see a range trade developing into the next set of supply in the holiday week," Spinello said.

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