Bond rally nearing an end?

surdo, mcurto, lance,

Thanks for your insight.

surdo, thanks for the offer!

lance, keep us posted on when you make your decision. A lot of money was made on your call back at the 107 / 108 area. Ahem.
 
Gross is bearish on the future as always.
But the future is tomorrow and the market is today.
Bonds are looking toppy in here.
But a lot of economic data this week.
Watching, but looking to go short.
 
Yield target for the 10yr is 4.75 ( Rick Santelli's clue) and for the 30yr is 4.85 ( where the selling will start). Unless the payroll number is way below expectations. If expectations are pushed down to extreme the bond pit will sell any rallies after the report. Have seen this happened many times.They clean up the stops before going down.
 
Lance,

Obviously you'll be following the 0730 CST reports out on Thursday and Friday. So your main focus will be Friday's job report like everyone else? Any ideas / strategies for Thursday's stuff or even some of the other reports on Friday?
 
Thursday will be a technically driven market, probably an inside day( lower high, higher low from previous day). The data out on thursday will be ignored and the expectations( pit rumors) for the payroll on Firday will begin to move down. How low? as low as possible to build up an excuse to sell.
 
Quote from johnpinochet:

Lance,

Obviously you'll be following the 0730 CST reports out on Thursday and Friday. So your main focus will be Friday's job report like everyone else? Any ideas / strategies for Thursday's stuff or even some of the other reports on Friday?
More...

Turning points have happened on or near Jobs report the past few months, this could be one of those times... nice observation Lance...
 
I don't know about selling quite yet. Mortgage accounts started the move from 4.63% in cash 10s out to 5% and change for the yearly highs. I think there is a major convexity buying level at 4.63% on the way back down (all of the call hedges are placed at 108 in futures which is that level in cash). I would rather look to take profits into that level than to get short. Might be dangerous selling into a freight train. Also don't forget the monster Lehman index extension tomorrow at .21 yrs that is about twice more than normal.
 
Quote from mcurto:

Also don't forget the monster Lehman index extension tomorrow at .21 yrs that is about twice more than normal.
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Can you explain this more? They are increasing their duration by .21? Meaning they'll be selling shorter term paper and buying longer terms?
 
sharp10,

One more thought as well. Keep in mind that we all have different styles. I suspect most on this thread are taking on longer term trades. And then there are the shorter term traders.

The two styles don't necessarily mix (see my post here yesterday) unless you're trading a short term signal that is within the trend indicated by the longer term signal.

Basic stuff, I know, but you said you were new to the interest rate futures.
 
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