18/03/2014

Crimea past military fears as the global economy turn to financial sanctions to tell off that naughty Putin. So bonds drift aimlessly with a slight weaker tone there is a clear eye on FOMC Wednesday evening.

Ten year 30min

 

bund 30min

I see plenty of room down for bunds but with another disappointing CPI and an ever strengthening currency the short end is likely to stay a little bid. Draghi may be dragging his heels but a rate cut must be coming.

€ curve

Timing and size are everything....Too much too early is frustrating at best, expensive at worst. I will look to fade bund rallies and put steepeners on small. The short term trend has clearly turned. Only time will tell if it can crack through the longer flattening trend.

 

€ teds

 

Look out for ZEW this morning. Along with listening for Russian rumblings obviously.

Good luck.

17/03/2014

Uncertain open in bunds today as we struggle to measure the impact of this weekends referendum on confidence. I think the outcome of the vote was not a surprise and therefore priced in. Nevertheless this is not a good thing for Goepolitical landscape so i feel risk off is the big play. This weeks FOMC will muddy that play quite some, With improving U.S. data and weather the fed at least will continue with taper. Next stop talk of rate rise!
Bund 30 min. Momentum has been heavy today we broke fridays low straight off but the rally to mid 50s was a bit of a curve ball. So far a failure to break 26 with any force today could signal a quiet mid range afternoon with a smattering of Russian sanctions thrown in to spook weak shorts out.

 

€ curve

Early strength in  the bobl has lead to an exaggerated up move in the bobl/bund spread. As it is in line with the 2s10s & 2s5s curve steepen it would be fool hardy to step infront of it....Unless hedging with a Schatz effectively putting on the Fly. Personally I'd like some bund rallies to fade into steepener positions.

€ teds

After the extreme FTQ bid in bonds and the failure to find any liquidity in the 17s expiry. I've decided to shuffle a bit in on bob teds. Some of the "risk Off" sentiment now dissipated. Ill start playing these from both sides looking for relative value again.

 

14/03/2014

U.S. tens has continued to drift higher since the Eurex close, only by a couple of tics but enough to ensure that bunds are likely to test above yesterdays hi early this am.

ty 30min

Dax appears to have been hit by the Ukraine situation harder than other indices which makes sense given the business ties Germany has with Russia.
Dax Daily

 

 

 Ukraine/Russia conflict, Chinese economy struggling and Japan not looking too good. Draghi starting to voice minor concerns regarding Euro strength all seem to amount to buying German bonds and Euribor.
bund 240min

I can imagine we'll get a pull back at some point maybe just ahead of Lavrov's meet with Kerry. If nothing solid is dealt with during these talks make sure you're not selling bunds for the weekend!

We also do have some data to contend with. Ger CPI, EUR employment change this am before  US PPI & Michigan Consumer Sentiment. US data has started to shrug off the spectre of Polar Vortex  so these may give some respite to the up moves in bonds. (probably good opportunities to buy dips!)

 Bund 30min

 

€ curve

As you would expect, lots of aggressive flattening. If my memory serves me correct tho these type events do usually see more aggressive buying in bobl. This clearly hasn't happened as the bobl/bund spread has flattened quite a bit and previous lows are in sight. If i buy any of these spreads today it will only be on the back of a huge bund up spike......And I'll be making sure i'm out very quickly. That said. I wont be adding to any short spreads without a significant pullback. This all despite Draghi's semi Dovish tone last night.

 

 

€ teds,  shortend teds begin to come under pressure as expected during these occurrences. Draghi concerns about FX has added a little support to the Euribor. So the down move has been relatively gentle. In the back reds and greens we are witnessing quite some strength versus Bobl. I guess the lack of liquidity has meant that the bids are chasing very nervous offers. Can't see a market maker offer for miles!

 

Good luck

 

13/03/2014

 

Bund 240 min,

No improvement in Russia situation and the drama in New York building collapse all add up to bonds higher yesterday.

 

 

So the momentum is still higher right now. Look for around 68s for first strong support but could also see minor around 78/81 area.

Resistance could be around 143.14 then 26. ECB monthly report could be influential today...especially on curve trades.

With the up move in bonds yesterday we witnessed the 5s10s follow in the flattening trend although it still hasn't reached its lows of early march whilst 2s5s & 2s10s are making new ones. I see the Schatz has not yet recovered from the big sell off post ECB meet last week.

Euribor on the other hand seems to have shrugged that disappointment off quite impressively. As Teds continue in their up trend...particularly in the greens vs bobl.

I feel that the Bobl teds appear at the peak of the up trend which is quite impressive in the context of the bond up move.

Host of U.S. data to look forward too this afternoon. So we might get action especially if bonds continue to move up for new highs.

12/03/2014

bunds
Choppy mid range...ECB members commenting on market "misinterpreting" last rate conference gave a bid tone in the late morning just as the Ukraine news started to lose its FTQ bid.
These comments helped the bund to make a hi of 142.68. However no attempt was made at filling the 6th march opening gap to 74.
Bund 30 min

Despite being someway from its highs the bund is still in an uptrend long term, in the mid term the trend was clearly lower since making the high on the 3rd. Short term is very choppy just now so we are at an interesting point as the 2 trend start to meet.

 

bund 240 min

 

€ curve

Only 2s5s appears to be in strong trend, both long term and short term charts trending lower.

2s10s long term still lower although the shorter timeframe shows plenty more sideways chop. Whilst 5s10s has bounced quite someway from low and on both timeframes looking midrange.

€ teds

After modays higher ltro repayments and fixings gave dip buying a scare especially after no rate cut on Thursday. Since then its been biz as usual as the uptrend had reasserted its self.

Ukraine issues still not over so maintaining a tight defence on any ted longs or bond steepeners.

 

BTP/BUND spread on bottom of uptrend moving average right now..After early march push higher I wouldnt be surprised if this has a minor correction. It would scare my dip buying approach to teds tho.

Schatz auction should be worth watching today. French non farm, Spanish & Portugal CPI and EUR Industrial Production all out this morning.

Nothing of any note US this afternoon tho.

SnP showed a moment of weakness yesterday. Keep an eye on that this afternoon.

 

 



23/02/2014

Oh what fun we have ahead...Data laden week fills me with optimism for a good volatile finish to February.

Bund  240 min.

Although the steam has run out on the up move since NFP day I struggle to see any of this weeks data surprising to the upside. We could drift lower on account of no more bad news but I'm not comfortable with big steepening bets of any conviction yet. I think its just safer to go range trading til my 30 min charts start to define decent trends.

€ Curves.

€ teds

The lower bands of the upward trend were tested over the later part of last week as the bonds made attempts to climb higher. With resolution to the Ukraine issue appearing to be on hand, Italy's political uncertainty seemingly resolved we saw the wind taken out of them sails. I still see buying dips the way forward here.

TYA

$ Curves

These charts don't really help me get a strong conviction for any direction right now.

Safe trading buddies.

Lee

ECB day

Morning all.

As expected a slow start to the day as we prepare for the ECB rate anouncement and Draghi speech.
A test of 143.85 in the bunds this morning looks on the cards but I'm keeping myself out of any directional bias in the am. The continuation of softening inflation data out of Europe increased the chances of a rate cut today, but as it drew closer there is a sense that Draghi will hold off. We could be in for a real volatility treat short term when Sterilization starts to be mentioned along with rates corridors. Plenty of things just around the corner that could set off severe discomfort in the Euro area over the coming months. So its probably wise that Draghi and his merry band continue to remind us they have the tools. This should hopefully steady nerves and prevent any full scale periph bashing to add to EM woes.

Bunds 30 min.

Bund daily, thats quite a trend.

 

 

Cme futures EurUsd Mar. 30min

Stoxx. 30min

 

Something I use as a pretty decent leading indicator for my Teds, Btp Bund spread.

Teds

€curves, I'm getting the first sign of a buy opportunity in curve trades just now. Obviously I'll wait and see what happens this afternoon. The spreads of all crawled over my 60 and 20 moving average. So I have a cheap stop on the short term timeframe. Long term however, I sense it would be foolish to look for any significant rally just now.

 

Bor Spreads

 

Good luck

L