27/03/2014

U.S. Treasuries finally popped above the post Yellen range. Decent 5 year auction helped the rally along with some poor stress test results for the U.S. banks.

 Bunds set the tone with an early drive to 143.44. Momentum with the upside now and would look to fade any move down 143.25 area today.

€ curve
The longer term trend wins out as we continue to flatten. Continue to fade any rallies in spreads Looking at the bunds to stay above 143. Bobl showing some strength, so the easier trend trade would be to sell schatz vs bobl although Selling bobl vs bund could offer value.

€ teds As the bund rally gathers pace, the bonds begin to outpace the Euribor....well at least that's what I would expect.. It hasn't really happened yet, just seeing signs that the Schatz ted could be turning over having reached the top of March range. Bobl teds doing as the say on the tin.....Sure the overall bobl strength is the factor here.

UK retail sales, and US GDP to look out for today.