Archive for the ‘Eurodollar Options’ Category
CPI today. Tariff impact?
July 25, 2025**************–Quiet session Monday. Large trades: BUY 50k 2QH6 9800/9825c for 1.0 ref SFRH8 9656.0. Settled 2.25 and 1.50 or 0.75 vs 9655.5. Expires 13-March 2026 SFRU5 9593.75/9600cs 1.375 paid for >50k on the day, settled 1.25 vs 9585.0. (5.0/3.75). Expires 12-Sept, while the Sept FOMC is on the 17th. Call spread would likely […]
Unstable coin
July 14, 2025**************–Bitcoin continuing to rip higher this morning, $122.5k as of this Monday morning note. As can be seen on the attached chart, SPX priced in bitcoin is unsurprisingly making a new low, in concert with our government institutions. In 2020 , SPX priced in bitcoin plummeted with Treasury doling out direct USD payments […]
Sell bonds, wear diamonds
July 13, 2025**************Sometimes, all you have to do is look at something simple. Economic data might be murky. But the chart below is clear. Yogi Berra: “You can observe a lot just by watching.” DUBLIN, July 10 (Reuters) – JPMorgan CEO Jamie Dimon said on Thursday he thought the financial market was underestimating the possibility […]
Day Baseball
July 11, 2025**************–Bitcoin new high this morning, nearing 119k. Market cap is $2.63T. Top 5 cryptos according to coinmarketcap.com have combined market cap of around $3T (bitcoin, ethereum, tether, xrp, bnb). Look around at the world’s political leadership. Bitcoin up over 7x since late 2022. NVDA market cap $4T. –Waller says the Fed is restrictive […]
Drivel
July 10, 2025**************–Back in the day on the old CME floor when we traded eurodollars, I would meet a group for market discussions and general pontifications on Thursday post-close at the Venice Cafe, a lunch cafeteria across the street from Sears Tower and 2 blocks south of the Merc. A more succinct description is: we […]
Electric Shock Therapy for Dr Copper
July 9, 2025************–Light volume day Tuesday. Yields were up 1.0 to 2.5 bps across the curve. Every SOFR contract from SFRH6 to SFRU8 settled -2.5. Copper was the big mover, up to a new all-time-high on the COMEX due to the latest tariff threats. HGU5 settled 5.6855, +0.6595 on the day. Still talking about Epstein? […]
Long-end yields vulnerable
July 8, 2025*************–Main feature yesterday was curve steepening and a weaker long bond. Auctions this week, with 3s today, 10s tomorrow and 30s on Thursday. Yesterday tens rose by 5.9 bps from Thursday (at the early futures settle) to 4.393% and 30s jumped 7.8 bps to 4.929%. As mentioned over the weekend, as yields go […]
Ease pushed back
July 7, 2025************ –NFP +147k (rate of 4.1%) was strong enough to disabuse the market of any thoughts of a near term ease. Weakest contract was SFRZ5 which plunged 13.5 bps to 9616.5. That price/yield of 3.835% is 50 bps lower than the current EFFR of 4.33% suggesting 2 eases by year end (FFF6 settled […]
Can Confidence Crack – CCC due to BBB
July 6, 2025 – Weekly comment********************************* A couple of weeks ago, I listened to a podcast featuring Brent Donnelly. In it, he said that a friend urged him to read The Storm Before the Storm; The Beginning of the End of the Roman Republic (by Mike Duncan). The recommendation was given due to striking parallels […]
Happy 4th of July!
July 3, 2025*************–NFP today expected 110k from 139k last, with a rate of 4.3%. Given yesterday’s -33k ADP, risks appear weighted towards sub-100. I had expected to see quite a bit of high gamma put buys in front of today’s data as yields remain fairly low, but an example of a late trade was a […]
