Bond rally nearing an end?

Surdo,

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100,000 have traded between 00 and 02 today in the 10yr, options related hedging on the 100,000 sep 107 calls that expire today. Terrible range but if you increased size and sold around 02 could have done well today.
 
hello ... saw this headline on bloomberg wires today

I assume you guys already posted or have discussed this
news on the huge positions in futures taken by certain
funds ... my question to those more knowledgable than me
in the fixed income futures area would be
has there been alot of or a little bit of profit taking
when the yield has approached 4.75 % area


-Hedge Funds Fuel Treasury Rally With Record Bet on 10-Year Debt -
 
The market is crazy long right now. Not to mention add the mortgage guys in the options markets long 100,000 each of the Dec 109 and 110 calls (Wells Fargo) and 50,000+ Nov 108 calls (Countrywide) in the 10yr options. This is definitely a market extreme that is hard to fade, but if for some reason the market begins to tire and we start hitting some of these sell stops it could get really messy. The last time we hit solid sell stops from way too many longs in March the 10yr got hit for about a 5 point move lower and had lots of trouble finding a solid bid until June. This could get really interesting on the downside if ADP and NFP surprise on the upside.
 
Quote from mcurto:

The market is crazy long right now. Not to mention add the mortgage guys in the options markets long 100,000 each of the Dec 109 and 110 calls (Wells Fargo) and 50,000+ Nov 108 calls (Countrywide) in the 10yr options. This is definitely a market extreme that is hard to fade, but if for some reason the market begins to tire and we start hitting some of these sell stops it could get really messy. The last time we hit solid sell stops from way too many longs in March the 10yr got hit for about a 5 point move lower and had lots of trouble finding a solid bid until June. This could get really interesting on the downside if ADP and NFP surprise on the upside.
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Thanks for hte analysis mcurto, no way I'm trusting the ADP report again, but I'll obviously watch how the market reacts to it...
 
Quote from landboy:

Thanks for hte analysis mcurto, no way I'm trusting the ADP report again, but I'll obviously watch how the market reacts to it...
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When does the ADP come out?

Luc
 
C.O.T. Indexes 8/25/2006

COMMERCIAL HEDGER LARGE SPECULATOR SMALL TRADER

SYMBOL 8/22 CHANGE 8/22 CHANGE 8/22 CHANGE

- - 10Y-TN 0% 0 100% 0 100% 0


- = Minor Sell Signal - - = Major Sell Signal
 
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