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Bond rally nearing an end?
- Thread starter gharghur2
- Start date
Yes mcurto -- thanks again! Very informative contributions.
Bernard
Bernard
I'd like to say thanks to mcurto too. Ive been reading his stuff for about a year now.Very informative stuff.
well, things look bad for longs again today.I was thinking there would be a rally at the start but no such luck.
maybe next stop is 4.80% on the ten-year. Im talking about today or early next week.Stranger things have happened.
thoughts?
blackguard
well, things look bad for longs again today.I was thinking there would be a rally at the start but no such luck.
maybe next stop is 4.80% on the ten-year. Im talking about today or early next week.Stranger things have happened.
thoughts?
blackguard
Cash levels are probably 4.76% and then 4.85% in the 10yr which are both spikes along a trend line as we traded back from above 5%. Market might be a bit short (seems like only dealers though and not necessarily hedge funds) into ISM for next week and if the number is consensus to a bit lower this sell-off can be erased rather quickly.
Agreed. Considering today's report, should the T-Bond future really be down about 3/4 on the week? I covered some of my short position on this rally.Quote from dhpar:
what a day today. I have somehow problems to interpret it - on such a nice data such a small move? Looks like Asians must be back and continue to bail out US from high rates...
I wouldn't worry about grasping the trend because some big accounts are on the same side as you. The mortgage servicers bought more than $1 billion of Fannie Mae (mostly 5yr) this week in anticipation of rangebound trade. They got exactly what they wanted today with the market stabilizing around 107-16 in the 10yr and retracing half the move of the morning back to 107-28. Front-month volatility is back under 4% which definitely helps their position because as long as we don't rally back to 109 or higher they won't be worrying about prepayments/refinancing on those mortgages. Definitely some worries out there about stocks (specifically emerging markets) and seems to be some asset allocator type accounts rolling into Treasuries as well. Dealers can afford to sell this stuff though at decent levels because they are still net long around $35 billion. NO numbers next week will be interesting if the funds pile back in long to Treasuries. Anyone have any idea about supply next besides 10yr TIPS? That seems to be the downside risk.