25/03/2014

Yesterday was a bit weird. Overnight Eurodollars and bonds on their Yellen is a catalyst for a weak European open. Then we spend the whole trading day grinding higher through my 124.68 and 124.90 areas up to and currently 143.15.
Ten year 30min

bund 30 min

With month end & quarter end approaching, a possible rate cut next week and Russian situation still bubbling away I guess its prudent not to have too much of a "risk on" position just now.

€ curve
One way traffic from the open. Reinstating curve flattening as the way forward. In the short term I would fade this move if we see any fast rally from here in the bunds. The current grind is very hard to fade tho, so it might be wise to continue sitting on hands till we get the panic spike or a break below 142.90 in the bunds. Playing from steepener perspective I would buy spreads on a bund test of 142.90 with a tight stop and reverse.......Clear as mud! LOL, plan your trade, trade your plan. Been a tough month so its all about shekel retention.

 

€ teds.

Just to add to the weirdness for me in this up move we see short Euribor climbing higher quicker than the bonds. So maybe this is more rate cut than Russia uncertainty. Bobl teds still behaving nicely both sides of the range.

 

 

 

 

On the data front we have IFO at 9 then bunch of UK figures, main one to look for is CPI I think.

 

 

Good luck