Archive for the ‘Eurodollar Options’ Category
Is Powell dovish?
March 19, 2019 –Stocks at new ytd highs this morning, as is WTI crude, with CLJ nearing $60/bbl at 59.60 last, +22. However, rate futures are also slightly better bid as the market anticipates a dovish Fed. While Q1 growth will be weak, former NY Fed chief Dudley thinks that there will be a rebound […]
When I was 16
March 18, 2019 –New recent lows in the first three one-year calendar spreads with EDZ9/EDZ0 still the lowest at -21.0. In the beginning of January the lowest settle for a one-yr spread was -28 (June’19/June’20) so we’re getting close. The attached chart shows the first five quarterly June contracts. It was in early December, before […]
St Pat’s in Chicago
While the major party is downtown along the Chicago River which is dyed Kelly Green by the Plumber’s Union. there are plenty of other festivities through the city. I had the chance to drop in on this one at the Hall of the Internat’l Brotherhood of Electrical Workers as I was invited by Bill Corry […]
Gold and Golds
March 17, 2019 – Weekly note I don’t know much the gold/silver ratio. Perhaps some of the extraordinary strength in palladium caused gold/silver to rally in sympathy. In any case, the chart below is interesting, as the ratio is pressing new highs just under 85, even as stocks have seen a spirited rebound from December’s […]
THAT is why I am your king!
March 15, 2019 –Going into next week’s FOMC meeting, the new ‘dot plot’ and projections should be interesting. In December, the projections indicated 2.9% for the Fed Funds target by the end of the year, so two hikes. However, the dot plot actually had 6 dots at 3.1% (out of 17 total). Obviously these projections […]
Solid 10y auction
March 13, 2019 –Yields dropped across the board yesterday with solid demand for yesterday’s ten-yr auction. Tens fell over 3 bps to 2.605. Euro$ contracts from reds through golds were up 3.5 to 4.5 bps. Large trades occurred in TYK calls: initially an exit of 50k TYK 123/125 call spreads at 23 to 24 pre-auction, […]
Inflation? Not in commodities.
March 12, 2019 –Yields pushed a bit higher in response to the powerful rally in stocks. On the eurodollar strip, the red pack (2nd year) was weakest, closing -2.75. All red to deferred pack spreads made new lows, with red/green (-9.5s) right at the low made in early 2000. A couple of large trades in […]
Astonishing new lows in BBG Grain Index
New lows today in the Bloomberg Commodity Grain Index. Good thing there’s no relation between this index and inflation, eh?
Guessing Powell Already Knew Retail Sales?
March 11, 2019 –Treasuries slightly weaker this morning, as apparently the only thing that came out of Powell’s 60 Minutes interview is that he expects a rebound in consumer spending. Retail Sales is out this morning. After December’s shockingly weak -1.2%, the headline number is expected 0.0, but +0.3 excluding autos. Three year auction also […]
Downside Risk Bandwagon
March 10, 2019 (weekly comment) The past week was a full-on compendium of global downside risks. First I will briefly highlight some of the comments and events. Then I will have a note on MMT and the increasing trend of government policy-makers implicitly making the assumption that they are the driving economic force. Finally, I’ll […]
