Archive for the ‘Eurodollar Options’ Category
Jan 9. Ten year yield edges lower…auction today should be a test. CONSUMER CREDIT
–A lot of bullish trades in interest rate options yesterday. For example, Green Sept 9925/9937c spd bought vs 9875p (sold put for 1.5 credit) 20k. TYJ 128.5 put were sold about 20k from 23 to 25, with last batch being sold at 23 vs 130-25. (both new). Curve flattened as ten year yield fell a […]
Jan 7. Possible trend change in US long rates…
–Employment data came out pretty much as expected with NFP up 155k. Yields continued to edge slightly higher. New high in 2/10 treasury spread near 165, up only 1 bp Friday but fully 15 bps from the end of the year last Monday. Red/gold pack spreads rose 2.5 bps to 150.75. Tens +1.5 to 191.5. […]
Jan 4. Gamechanger
Jan 4. Early weakness in interest rate futures was sparked by stronger than expected ADP (215k vs 140 exp) which caused some shops to ratchet up today’s NFP estimates (~170-190). The real accelerant was release of the Fed minutes which said that sev’l members wanted to end QE in 2013. Some Fed members are uncomfortable […]
Jan 3. Stocks soar yesterday…treasury yields rise
–It wasn’t just the US stock market which exploded higher as a result of the fiscal cliff deal. India, Brazil, DAX, Korea Kospi, Shanghai, Hong Kong, Japan etc all surged. Perhaps it’s more than just the US political system that is sparking a rise in financial assets. More related to central bank monetary measures as […]
Jan 2, 2013. Fiscal cliff averted
–Fiscal cliff averted; stocks continue Monday’s anticipatory rally and bonds decline. Next up: debt ceiling negotiations. –Though markets have breathed a sigh of relief, it’s difficult to conclude that the real economy will respond accordingly. Payroll taxes are still going up 2% as the Bush cut expired. Confidence has been shaken. For example, last week’s […]
Dec 31, 2012. Happy New Year
–Happy New Year. Still no budget deal. The lack of new details in negotiations on Friday afternoon caused a sharp end of day sell off in stocks… visualization of a fall from a cliff. This morning stocks have found tentative footing with SP’s churning near the midpoint of November low and December high, supported in […]
Dec 28. More fiscal cliff drama
It’s all about fiscal cliff negotiations now. The bigger picture is what will happen when agreement is reached. Since August tens have been in a range of just below 1.6% to around 1.85, having tested 1.84 earlier this month. We are now in the middle with yesterday’s close of 1.72. Many are looking for an […]
Dec 27. Debt limit joins fiscal cliff
–Geithner informs us the debt limit either has been hit or will be by year end, adding further drama to fiscal cliff talks. Many analysts say lack of action may push the US into recession…probably in recession already. –News today includes Jobless Claims expected 365k. New Home Sales expected 375k. Consumer Confidence expected to fall […]
Dec 13. Fed announces thresholds to determine policy
“We also understand sales to be an indicator and they are very bad industry-wide. I am seeing the worst results in locations near shopping where we are usually the strongest during Christmas. Watch for some really bad retail numbers! Talked to someone from Target over the weekend who confirmed.” Above is purely anecdotal evidence, a […]
Dec 10. European data continues to point to weakness; presents downside risk for FOMC Wednesday
–Slightly better than expected employment report Friday saw ten year yield edge higher to just over 1.62. NFP 146k but previous months revised lower. Curve in eurodollars steepened with red/gold up a bit over 3 bps to 115, barely even qualifying as a dead cat bounce on its way to new lows (recent low 112). […]
