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Bonds On Support Again
By Nic Lenoir of ICAP
We are back testing the support on the daily chart in bonds today following NFP. Number did not beat expectations but speculative pressure and fear of a discount rate hike next week (we think it probably won't happen and if it does it should not impact rates materially) helped push the market lower. The support here is key at 114-25, if we break below the next level is 111-26. Looking at the 30-minute chart, I think we have a very clean ABC formation and the next move could well be up. Since we are right on support I would look at being long via option structures, and quickly reverse to shorts if we close below 114-25.
Have a good weekend for those who made it in!
Nic
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Short Ts with Zimbabwe Ben at the controls? You can count me out:
http://www.youtube.com/watch?v=BPsSWoYursc
Good thing Timmay is rolling over that $300B a week into bills.
Mother of all H&S on the monthly chart !
Nic, I'll take your trade on the opposite side. TYX has already broken out upwards; today's NFP is just amplifying the move. When that neckline breaks on your chart, which it already has if one looks at the original neckline, it will be bombs away for the longs. The upcoming auctions will tell the tale. You might want to look at the 2s-10s chart; the corrective has completed.
The clowns are playing with fire as usual. I wonder how much crap they can stuff into 7 year duration as a backstop before hitting 10 and 30 year.
I am very glad to see I am not the only person working today.
Curb, didn't you hear? Everyone is working now...Rally on! Everyone's got a job nothing but up from here. (oh, right...except that pesky 20% of the working population that isn't.)
All Amerika worker happy employed
The bond market is ten times the size of the equity market, is it not? What happens when the traders move their investments?
You're forgetting the size of the CDS market, which is several times the size of the Bond market.
Nic, I think we will see a rate hike (0.25%) due to the FED meeting on Monday. It will be done to send a message of monetary responsibility to China in anticipation of the upcoming Nuclear talks mid-April when the heads of state will meet.
Mark Beck
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