Bond rally nearing an end?
- Thread starter gharghur2
- Start date
I'm going with a little soft to right on the money as usual. I think our trade is more dependent upon positions already out there. There was a ton of put buying today in the 10yr and 30yr, with new positions from Bear Stearns in the June 106 puts, bought 10,000, so the worries are obviously for an upside surprise in the number. For this thing to really move downside and test those mid 4.90's yield in the 10yr I would say we need a blowout. But the mortgage guys, mainly Countrywide, have been loading up on August 107 calls, about 20,000, and these aren't even listed yet, they are trading them as flex options, so that is very interesting as well. I would like to say it will be crazy tomorrow, but my guess is volatility gets whacked and we sit after the knee-jerks both ways.
Here's what my favorite TA guy says about the chart:
Hi Tony
Falling wedges often play out as follows. They are falling patterns often with bullish divergence per MACD as they near their apex. I personally position long in the wedges once the divergences are well entrenched. Sometimes they take a little while to play out, but once they clear the downtrendlines they really move. Many will turn into Inverse H/S Patterns and then eventually break higher from there. I've seen this process played out so many times over the years. I can't say for sure but often wedges like that retrace all the way to the top. If they start to show signs of wear such as negative divergence in the oscillators (but not during inverse h/s patterns as they usually form with divergence) then I use that cue to exit the play.
Rob
bullish divergences ... once downtrend line is cleared ... they really move ... retrace all the way back to the top
Hi Tony
Falling wedges often play out as follows. They are falling patterns often with bullish divergence per MACD as they near their apex. I personally position long in the wedges once the divergences are well entrenched. Sometimes they take a little while to play out, but once they clear the downtrendlines they really move. Many will turn into Inverse H/S Patterns and then eventually break higher from there. I've seen this process played out so many times over the years. I can't say for sure but often wedges like that retrace all the way to the top. If they start to show signs of wear such as negative divergence in the oscillators (but not during inverse h/s patterns as they usually form with divergence) then I use that cue to exit the play.
Rob
bullish divergences ... once downtrend line is cleared ... they really move ... retrace all the way back to the top
My best guesstimate, based upon what I was originally anticipating for this wave down, is that we have about another 1/2 point to go in both the 10yr and 30yr on the downside.
I was originally expecting at least 6 to 8 points down on the 30yr: currently 7 1/2. And 5 points down on the 10yr: it's dropped 4 1/2. I feel we're getting close to a low .........
any thoughts?
I was originally expecting at least 6 to 8 points down on the 30yr: currently 7 1/2. And 5 points down on the 10yr: it's dropped 4 1/2. I feel we're getting close to a low .........
any thoughts?