22/04/2014

A very slow day back from extended weekend.
I saw Thursdays bond sell off as optimism driven by Geneva talks on a deal to settle the Eastern Ukraine Hullabaloo. Some of the long end war premium coming out if you like.
Despite some skirmishes after the Geneva agreement not much reinstating of those long end positions occurred on Sunday nights Treasury market. Monday was dead too, so we looked forward to the European open to stir up some interest.

Well Bunds opened too high for me to be an aggressive buyer and didn't rally nearly enough for me to be short.


Ten year 30min

As I type this the U.S. 10s are beginning to test Thursdays low areas. No negative news out so main focus will be on FOMC next week. Last weeks shaky S&P price action has been shaken off so we can get back to the BTFD plan whilst we make a concerted effort to make new all time highs before the next Taper.
Mini S&P 240min

 

In Europe there is continued attempts by ECB members to talk the markets into doing their dirty work. Enabling them to actually do nothing at all. Just as long as we don't buy EURUSD above 140 we are ok. At some point someone is going to stick it to Draghi and his cry wolf! So best he either cuts rates or starts QE (in one way shape or form).

 

EURUSD cme fx futures 240min

 

In truth, I'm a little puzzled by the Euro strength. Maybe I haven't considered the real long term issues....answers on a postcard please.

 

 

Bund 30min

 

As the more proficient technical analysts have pointed out. Bund looks heavy. In my mind tho we needed to balance Thursdays sell off before looking lower. We have done that this morning so a break of pre Easter lower is likely. Especially if the US has anything to do with it. Being short outright bunds tho will always carry the danger of more QE BS from ECB members.

 

€ curve, Short term all eurex bond curves trading around the top of range. If bunds break lower we will see these continue to trend higher and maybe test the upper areas of the longer term down trend channel.

 

Whilst talk is still about loose measures in Europe I'm inclined to follow the long term down trend. Look to fade any large up moves in the spreads & run tighter stops on any dip buying.

 

€ teds

 

Bobl teds have continued to be well behaved, Schatz teds have pretty much done as expected too. As we draw closer to QE tho the shape of QE will be a large influence on teds so I'm keeping it light and agile in this arena.

 

Will try harder and be a more consistent poster. Although I sort of do this to have some form of accountability to my own trades. When I don't post its coz I'm "micro-trading" this stuff......And that is never a good thing, Unless you're my clearer!

 

Be luck

Lee