Archive for the ‘Eurodollar Options’ Category
WIN
November 24, 2021 HAPPY THANKSGIVING! –WIN was a 1974 slogan which stood for Whip Inflation Now. The current administration is also trying to whip inflation, by announcing yesterday a tap of the Strategic Petroleum Reserve. The market obliged (having already sold the rumor) and bought the fact. Yesterday CLF2 settled 78.50, up 1.75 on the […]
Stability at the Fed (but maybe not markets)
November 23, 2021 –New lows in all front euro$ contracts as Powell was reappointed, causing an unwind of bets for a more dovish Chair. Greens led the carnage, down 14 bps on the day (3rd year out). All contracts from EDZ2 back were down at least 10.5. New highs in some of the near calendars: […]
Flatter
November 22, 2021 –CME Nasdaq 100 futures are at a new all-time high this morning. I saw somewhere that there have never been as many stocks within the Nasdaq Composite making new lows as the index is making new highs. The attached chart shows the number of stocks making new lows in blue (about 10% […]
Discomfort Index
November 14, 2021 – Weekly comment The White House @WhiteHouse /July 1, 2021 (tweet) Planning a cookout this year? Ketchup on the news. According to the Farm Bureau, the cost of a 4th of July BBQ is down from last year. It’s a fact you must-hear(d). Hot dog, the Biden economic plan is working. And […]
Puking camel
November 12, 2021 –Light volume on yesterday’s holiday trade, but pressure on red eurodollars continues. EDU3 (the last red or 8th quarterly) settled 9876.5 on 5-Nov, one week ago. Yesterday the contract was 9844.5 or 32 lower. Technical formation is, of course, the famous puking camel. Early in the session there was an exit buy […]
CPI at 30 year high. Last time it was here, 10’s were 8.5%
November 11, 2021 –Monster move on monster CPI data with yoy CPI up 6.2% and Core +4.6%, which was followed by a poorly received 30 yr auction at 1.94%, having missed the pre-auction 1.888% by a mile. NY Fed also released its UIG (Underlying Inflation Gauge) with the ‘full data set’ +4.3%, +0.3 from the […]
Ten year TIP record low yield
November 10, 2021 –New low yesterday ten-year inflation “protected” (TIP) yield at NEGATIVE 1.206%. From the TreasuryDirect website: “The principal of a TIPS increases with inflation and decreases with deflation, as measured by the Consumer Price Index.” Today CPI is released and is expected 5.9% yoy with Core 4.3%. CPI hasn’t been above 5.9% since […]
Upside risks to inflation
November 9, 2021 –Yields rebounded yesterday on light volume and the curve flattened as the belly led the way. EDU’23 was the weakest contract on the euro$ strip closing down 10 at 9866.5. The five year yield rose 7.2 bps to 1.123% and tens gained 4.7 bps to 1.497% in front of today’s auction. Clarida […]
High gamma new assets
November 8, 2021 –TSLA down this morning as Musk asked the twitter universe if he should sell stock and the answer was ‘yes’. If I am seeing the correct figures the stock is down about 5% from Friday’s market cap of $1.227 trillion, or around $60b. Bitcoin is pressing new highs, currently 65990 vs ath […]
El Risitas
November 7, 2021 – Weekly note You have one job: to guide and align policy with monetary and economic goals. Andrew Bailey, after steering the markets to expect a November rate hike and then failing to deliver:“I don’t think it’s our job to steer markets day by day and week by week.” As Efficient Market […]
