Archive for the ‘Eurodollar Options’ Category
Four Barrel Carburetor
October 6, 2022 –A lot of crap news out there. This has nothing to do with markets, but good for these kids and for the guidance of the father… https://www.fox13news.com/news/group-of-teen-girls-transform-home-garage-in-manatee-county-into-an-auto-shop?utm_source=fark&utm_medium=website&utm_content=link&ICID=ref_fark Group of teen girls transform home garage in Manatee County into an auto shopThe garage of a Lakewood Ranch home has become an auto shop […]
Pressure valve
October 4, 2022 –The ten year yield dropped 14.5 bps to 3.653%. News swirled about an expedited FRB Board meeting yesterday; it barely matters whether it was previously scheduled or not, the market is attuned to myriad pressures on the Fed to abandon its inflation fight. For example, the UN called on the Fed to […]
What’s a Punch Bowl?
October 2, 2022 – Weekly Comment If we fail to apply the brakes sufficiently and in time, of course, we shall go over the cliff. If businessmen, bankers, your contemporaries in the business and financial world, stay on the sidelines, concerned only with making profits, letting the government bear all the responsibility and the burden […]
Breakevens at lower end of recent range
September 30, 2022 There’s something happening hereWhat it is ain’t exactly clear. Buffalo Springfield-For What It’s Worth –Those lines capture my sentiments about the market. Probably a good time to keep risk close to the vest as we enter Q4. –Ten year and five year inflation breakevens at new lows right around 218 to 219, […]
In: Eurodollar Options
Master of your own domain
September 29, 2022 –Central bankers are in a contest to determine who is the master of their own (inflation) domain. Yesterday, Andrew Bailey walked in, slapped his money down on the table, and blurted “I’m out!” Like Kramer. –Capitulation. First it was the LME with the margin call on nickel and now it’s the Bank […]
In: Eurodollar Options
7 yr auction today
September 28, 2022 –Bear steepening continues this morning. On Friday, SFRH3 settled 9549, SFRH4 9572.5, SFRH5 9622.5 and SFRH6 9640.5. This morning (from Friday settle) H3 9556.0 (+7), H4 9584.5 (+12), H5 9620.5 (-2), H6 9626 (-14.5). The front end of the curve is starting to forecast an end of tightening, the back end is […]
In: Eurodollar Options
The sea was angry that day
September 27, 2022 –Huge jump in yields yesterday with tens +18 bps to 3.87%. Implied vol exploded to the highest level since covid as attached chart indicates. Massive steepening on short end curves. SFRH3 was the strongest contract on the strip, closing +7 at 9539 (4.61%). SFRH4 9572.5, -13.0. SFRH5 9623.5, -20.5. SFRH6 9639.5, -23.5. […]
In: Eurodollar Options
She Can’nae take any more Captain!
Stardate: 47634.44 –Plunge in GBP to 1.0349 overnight though current 1.07. Dollar/yen over 144. CNY weakened to new low 7.16 vs 6.75 in early August. Strength in DXY threatening to bring down the whole house of cards. –US fixed income under pressure with JPY weak even after last week’s intervention; risk of US treasury sales […]
In: Eurodollar Options
Change in the Landscape
September 25, 2022 – Weekly comment On August 1, 2021, I wrote a piece titled Keystones, after watching a PBS nature show ‘The Discovery of Keystone Species’. The premise of the documentary is that a system without keystone species — typically apex predators– gets thrown out of balance. The related concept is ‘The Landscape of […]
In: Eurodollar Options
There IS an alternative
–Meltdown in rate futures suggests possibility of capitulation. Red, green and blue ED and SFR contracts plunged 18 to 21 bps on settle; new lows. Two year treasury at a yield of 4.12% (up 13) and tens jumped 18.6 bps to 3.702% in front of today’s October option expiration. New low in 5/30 treasury spread […]
In: Eurodollar Options
