Bond rally nearing an end?

Quote from Buy1Sell2:

Is it only a synthetic straddle once the long position is in the money (meaning premium received as if a put)?
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It's a synthetic through the use of futures in lieu of a natural straddle, which is a put/call combination. The trade would follow like so:

Long 1 Sep future
Short 2 xxx calls

Long 1 future x short 1 call = short put, synthetically. The above is equivalent to a call and put straddle regardless of where the bonds are trading.

Thanks SteveO; haven't traded bonds directionally for quite a while.
 
Quote from riskarb:

Long 1 future x short 1 call = short put, synthetically. The above is equivalent to a call and put straddle regardless of where the bonds are trading.
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In this scenario, the farther otm the call is simply creates a synthetic put that is also farther otm?
 
Quote from Buy1Sell2:

In this scenario, the farther otm the call is simply creates a synthetic put that is also farther otm?
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Right, the synthetic put is the same strike -- one of the calls creates the synth with the futures. I recycle my long futures and reduce transaction costs and slippage with the synthetic. I sell two calls per future instead of offseting the futures and selling a put/call straddle.
 
Quote from Buy1Sell2:

Traders may begin to use this thread as a sentiment indicator or a commitment of traders report :)
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An observer could use the dominating opinions expressed in this thread as the output of a diverse collection of minds operating in total freedom, meaning that everyone's specific experience or intuition is allowed and encouraged to contribute ideas, questions and impressions that pushes with an <i>invisible hand</i> the best observations forward through our continous and free exchange of information.
 
Actually, my father was and that's probably why I feel my country is the planet we live on, with no people better or worst than the others. And I'm expressing that as a simple state of mind <u>without any insinuation</u> or any intention to start a political conversation.

In any case, my comment was meant to be an attempt at understanding the benefits derived from a certain type of group dynamics.
 
Quote from Buy1Sell2:

One thing worth mentioning and it may be a little off topic. --When backtesting technicals, a person rarely matches up the news or announcements of the day with the chart. Backtesting is normally just done on the chart. This is what I have always felt --that technicals rule more than news. In the situation I described earlier , that was an intraday possibility and if occurred right before the announcement this afternoon, I think it would still be valid. If the first move was away from the tech picture, then that could be faded and an intraday reversal could be realized. --just an observation of technicals overall. If this is too off topic, let me know-- B1S2
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Of course, I don't want to turn this into a Euro thread, but I thought I would give an update on the short Euro future trade that I took yesterday. When I trade on hourly divergences, I put my profit target in at 100 pips . This got executed at 1.2735 while I slept last night. The reason I mention this is that my contention is that once news is out and trade has reacted, sometimes wildly, then the price begins to merrily go back to the path it was prepared to follow prior to the news. Yesterday, this included a thrust downward, followed by support and a move higher than my entry at 1.2835 and then it returned to it's path. Does anyone agree or disagree with my view on this? I am interested to hear.
 
Quote from gharghur2:

Nice trade, currencies are a bit too political for me
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Sorry, didn't mean to make it about currencies in particular. I was mostly curious if any of you noticed this in any market. For example if you were looking at daily and weekly charts and bought bonds etc on positive divergences etc. , do you notice that there is noise and then the market goes right back to the technicals?
 
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