Post FOMC

Good morning


Unchanged on forward guidance, asset purchase left at $85. All as expected, risks to economic outlook as a whole. No real reference to the recent shutdown hoohah. In short it was more hawkish than the markets expected. Hence the bond/equity sell off and dollar appreciation.
Mr Hilsenrath has taken this to mean that a December taper can't be discounted.
This has left a more balanced look to the bonds medium term, I still see higher into the year end. Looking forward to some interesting data in November.
Overnight we have seen a small bounce off of the Eurex close so I anticpate the bunds to be around the low 50s on open.

TYA

Bunds just about keeping the the shorter term uptrend intact.

€ curve, momentum still with the downside but with Taper not off the table completly there is plenty of room for steepening to occur. I'm still a fan of fading steeps at least until we have ECB and non farm(and unemployment rate) next week.

 

€ ted All eyes are turning to Europe and their special measures as we approach the "liquidity cliff" and what/how the ECB use to maintain some confidence.

 

 

EU cpi's and retail sales to look out for this am as well as post FOMC activity.

 

 

Good luck

Lee

 

FOMC

Everyone seemed to be geered up for Taper last FOMC. It didn't happen. We've had loads of fun with the U.S. financial state of affairs since. All of which pretty much assures there will be no taper this time, or even a great deal of interest in talk of it again this year. So we maybe, could turn our attention to the shorter end of the curve and consider foward guidance and rate hikes.

Here is what the US tens have done since last anouncement.

2 year

Dollar index

 

Not such a simple story in the mini S&P...after a brief spike up it spent sometime grinding lower on shutdown and default fears. Once that can was kicked into 2014 we all celebrated with some buy orders!!!!

 

 

Bunds mighty strong!

 

 

Sep4Sep5Sep6 Euribor vs Eurodollar

Dec5Dec6 Euribor vs Eurodollar

 

 

Good luck

Paradise, Downton and some wind and the bunds.

Last week saw the reopening of Government figures in the U.S, most of em reinforcing the sentiment of no QE taper ever....Well ok maybe not till mid 2014. I'm not that optimistic, but must remain adaptable coz I've no crystal ball and I measure my pnl daily. So I wont be stubbornly fighting the general consensus.
Nothing on the European front took away the the upside energy in bonds (& equities).
We have a data fuelled end to the month but I wouldn't be surprised if the volume drops off even more tho. School holidays in UK and a little wind in the south east.  I get the feeling to that not much real attention is being paid to the US data til November.

Bund levels

Bund momentum still to the upside, buy dips order of the day.

€ curve, on my longer term charts the flattening has been quite considerable since U.S. gov debt issues have been fixed. Whilst I can't see much reason for a change this week, I won't be surprised if we have some sideways action til ECB and next NFP. Obviously keep one eye on the month end extensions and Bund auction Wednesday.

Acct 73

Ha ha...Cheap stop I called this last week. Cheap stop it was. That wont stop me again this week, another cheap stop. I'm going short!

Trend is your friend

Gonna be more aggressive and scalpy in this when at the office. Shortened up the timeframe.

Spooked out of this mother last week. Ho hum, these things happen. It didn't cost me anything and I've learnt to make my trailing stops more aggressive.

Mini SnP

What can be said BTFD is now BTATH over and over. Who'll be the greater fool? 

Goodnight all

Lee

25/10/2013

Good morning all,

Yesterday afternoons drift lower in bonds met support not long after Eurex close. US 10s have bounced some 5/32s so I expect bunds to open around the low 80s. Medium term momemtum is still upwards but with some decent data to look out for this morning I would remain flexible on todays direction.
Tya

Bunds

first support around 140.70 for me but my bias is to buy dips at present...Although a failure to get above 91/92 may signal a small turnaround day today. Uptrend still intact whilst above 140.55.

€ curve. Steepening continues. We have seen quite an impressive trend here since the temporary US debt deal has been agreed. Even Bobl bund spread took quite a tumble. Smart money would be to fade into any rallies in these today especially if bunds stays above 140.55.

€ teds The brief show of strength after the Non farm number has given way and a complete reluctance to follow the bonds higher has led to quite a sharpe down trend occuring. Lots here will depend on the LTRO repayments today.

 

Eur m3, Ger IFO and UK GDP will keep us entertained before LTRO repayments. Whilst this afternoon we have Durable goods and Michigan sentiment to look forward to.

 

 

Be lucky

Lee

Non farm Friday.....I know......

Just some charts showing some price action over the last 3 NFPs....all 3 off the mark. Beginning to wonder what these analyst actually do with their time?

July 5th - Expected 165k Actual 188k (September contract)

My CQG wont give me enough data to show what happened here so I have used Bloomy.
Tya- Despite the beat being unspectacular in the grand scheme of things U.S. tens still made an impressive move. Starting around 125.285 down to 124.25.

Bund 142.32 down to 141.54

 

Bobl - Was in quite a strong uptrend at the time according to this chart. 125.90 to 125.64

 

August 2nd - Expected 184k Actual 104k (September contract)

Quite a big miss saw the tya from 125.085 to 126.15

 

 Bunds got sold quite heavily into the release from 141.92 down to 75 before the spike up to 142.49

 

Bobl 125.52 to 125.86

 

 

September 6th Expected 180 Actual 169 (December contract)

Tya - Modestly bad number against a trending down (Taper BS) market had quite some impact!

122.115 to 123.205

 

Bunds 136.75 to 137.77

 

Bobl from 122.55 to 123.05

 

 

Stand by yer beds soldiers!

Lee

 

 

 

 

Tusedays Non Farm Friday!

Good morning all,

A very quiet Monday saw the bonds fail to continue on there upward path. This despite the spike up on Sunday night. As the day wore on and the lack of interest turned to some small covering of longs nothing to get the bond bulls too worried tho.

Largely unchanged over night, so flattish call for bunds this am.

€ Curve.  Hanging around non taper FOMC levels at present and wouldn't be surprised to see us break down to new flattening levels over the coming months.

€ teds Schatz teds continue trend higher. Whilst 2015 expiry bor against bobl is range trading a little right now.

 

This morning will all be about positioning for Non Farm. Could be some decent opportunities for some value trades........Could be really boring.

 

Good luck

Lee

21/10/2013

Good morning all,

Tya. Rather a large spike overnight to 127.115 overnight has been given back so we are are 1 tick higher than at Eurex close.

So I expect bunds to open unchanged, momentum to the upside. Minor supprt 139.91 main at 72. Major resistence around 140.46ish but I expect any upside push to pause for breath around 140.25 first.

€ Curve, looks like steepening will continue at the mo.

€ teds Bobl appears rather strong at the mo. I still feel comfortable buying dips in teds...I guess it all depends what pack of bor you use versus what bond. Might consider going further out to the 16s if bond strength coninues. (I see no reason for it not to)

Minor league data this am...

 

Good luck

Lee

Bloody period drama double bill!

Acct73
Orange lines are short positions
Blue lines are long positions
No lines are no positions
Cheap stop in shorting this uptick....Orders will go in once these mkts open. Stop at -37500

This one mid range.....sit on hands selling rallies strong..passive dip buyer (against trend)

This one is a danger to hold...so passive in and aggressive out from either side!

This one is dangerous to execute but fairly stable......patience and room for slippage required.

This one is a fav...Geo politics aside!

Trend is your mate....or something like that. Got the chance to buy the dip after USD downgrade rumour caused mayhem in this field.

Goodnight

Lee

Muddy Waters

Good morning all,

Thank you America! This cute little fecker can now go visit the Lions, Tigers and Bears........
Yesterdays price action experienced more Bohner retractions than my 18/30s holiday to Benidorm in 93! It also displayed classic buy the rumour sell the fact psychology. All be it the the other way round for bonds....You know what I mean.
For days now bonds have pushed through new lows in anticipation of a deal on the budget/debt ceiling. When it finally comes the bonds rally there little booties off.
Over night the tens are 4 to 5 ticks higher than at Eurex close.

Bunds

Quite a pull back in the bunds after the announcement but we are still below the downward trend. So my thinking is this could be a good place to start shorting long end with pretty cheap stops. However; my view based on whats likely to happen over the next 4 weeks says "save your money". Data out of the U.S. in November is likely to be rather negative and any thoughts of a 2013 Taper should be thrown in the bin right away. We will have fun with the data for the rest of the year. Lots of "oh it was bad coz of the shutdown" might see contradictory movements/reactions.

The € curves displayed an equal amount of pull back from the long term trend.

€ teds.

No sign of a pull back here though. As news of credit scares are averted and a lack of LTRO comments for a week or so, I guess we can just expect some range trading.
UK Retail sales and some Spanish 5s and 3s auction to watch out for this AM.

Good luck,
Lee