Yields Collapse As Ackman Tweet Triggers Massive CTA Bond Buying

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by Tyler Durden
Monday, Oct 23, 2023 - 06:00 PM

As noted earlier, just hours after 10Y yields cracked above 5.00% for the first time since 2007, and threatened to surge above the key psychological barrier for good this morning as dismal sentiment hit rock bottom again, (former) bond bear Bill Ackman showed just how illiquid the bond market truly is when with one tweet he managed to reverse the entire onslaught of selling and pushed 10Y yields more than 10bps lower from 4.98% in a matter of minutes.

Whether or not such a powerful reaction to one tweet - which said nothing new technical or fundamental about the state of the US bond market but merely echoed an Ackman trade ticket (unknown if from today, yesterday, a month ago?) - was warranted especially since the US fiscal picture is catastrophic at best, with a staggering $600BN in new debt sold in the past month, is unclear but one thing is certain: the buying sparked a lot more buying and nowhere more so than among the CTA community as we previewed earlier today.