On The Verge Of An Epic Showdown: Demand For TLT Calls "Explodes" To Record As Treasury Futures Shorts Hit All Time High

The ongoing schism over the fate of the most important and liquid market in the world, US Treasuries, has reached never-before seen levelk.

Consider the following: with 10Y yields rising above 5.00% last week for the first time since 2007, ETF traders have been aggressively trying to bottom tick the selling in rates. They are doing so in two ways.

On one hand, as Goldman's Derivatives traders Brian Garrett and Cullen Morgan write, demand for TLT calls and call spreads exploded this week. That's because "this is a cheap way to play for a snapback in bonds." As shown below, average TLT call volume this was over 350k contracts per day, an all-time highs...