food and energy inflation running at a cycle high of 4.1, and that's low since hedonic input skews it low.... so with devaluation, you're getting a hose job with the 10 year at 5..... but 99.9% of the population is too stupid to figure out what is happening to them..... keep listening to Kudlow and Cramer, which is what you get for not watching McEnroe.... a deal of a lifetime..............
More supply! Thirty-Year Government Bonds Fall After Treasury Announces Quarterly Sales Aug. 2 (Bloomberg) -- U.S. 30-year bonds fell after the Treasury Department said it will start quarterly sales of the securities in February, raising concern about additional supply. The Treasury currently sells 30-year bonds twice a year. The government began selling the so-called long bond in February after a five-year hiatus. ``The market's reacted to a slight increase in long-end supply,'' said Alan De Rose, a Treasury trader and strategist at CIBC World Markets Inc. in New York. The yield on the 30-year bond rose almost 2 basis points, or 0.02 percentage point, to 5.08 percent as of 9:26 a.m. in New York, according to bond broker Cantor Fitzgerald LP. The price of the 4 1/2 percent security due February 2036 fell almost 1/4, or $2.50 per $1,000 face amount, to 91 5/32. Bond yields move inversely to prices. The Treasury also said today it will sell $21 billion of three-year notes on Aug. 7 and $13 billion of 10-year securities two days later in its quarterly refunding. It will sell $10 billion of 30-year bonds on Aug. 10 in a reopening of February's sale. Analysts expected three-year sales of $21 billion, 10-year sales of $13 billion, and 30-year sales of $11 billion, the median estimates of 10 economists surveyed by Bloomberg News. ``Total bond issuance in 2007 is likely to rise slightly to ensure liquidity in the new issue,'' the Treasury said in Washington. To contact the reporter on this story: Mark Schoifet in New York at mschoifet@bloomberg.net. Last Updated: August 2, 2006 09:27 EDT
Pension funds must be conflicted with this one, either buy now before the Fed pauses, or hold off on more supply down the road, plus inflation will have a bigger impact on the long stuff...
Nice call, as per usual, how much you think this market can squeeze further? I think tops 4.8 in the 30s then maybe a resumption of the bear market as inflation carries us into the end of the year...
The Treasury market deserved to adjust to a higher trading range in the wake of the surprising rise in the unemployment rate and the " under " shoot in the Non Farm payroll report.With the focus now directly on the upcoming FOMC rate decision and the jobs report distinctly favoring the "on-hold" stance one might even argue for more gains. In fact, the August 1st Commitment of Traders with Options Report showed the U.S.Treasury Bonds combined spec positioning to be net short 101,000 contracts and that would seem to leave the Treasury market technically and fundamentally poised for more gains.However, the combined spec positioning in the Notes reached a new record "long" positioning of 130,966 contracts in the latest COT report and even that lofty positioning reading is probably understated due to the fact that the market at the highs last Friday, was 2/3rds of a point above the level where the COT report was measured. Therefore, the bonds remain moderately oversold and the Notes are apparently historically overbought ! From a basic analysis, the COT report would seem to suggest that traders get short Notes and get long Bonds.The Press is carrying stories about the bonds/notes action signaling that the Fed is set to go on hold and some players are suggesting that the "hold" could be a sustained condition. In fact, the Press this morning is rife with suggestions that the "on-hold" decision on Tuesday is perhaps too late for the equity market and that stock prices are set to tumble significantly as they price a noted slow down in the US economy. Certainly the odds of an on-hold outcome from the meeting Tuesday leaves the potential for near term additional upside action high, but given the disjointed pattern of the US numbers, the statement from the Fed might trump the decision to hold rates steady. In other words, the Fed probably hold rates steady, but they can hardly risk fanning the inflationary psychology by hinting at a sustained on-hold stance.
let me step out of my usual contract and try ZN just sold Sept 06 ZN at 106'130 for the record I am holding until further notice. I am not heavily margined, I trade this contract doing 1 contract per $5000 capital. holding until further notice blackguard
The 10-yr futures contract is sitting on support around 106-13+, with another test of the 106-13 upper channel boundary that was converted from resistance on Fri under way. Prices look to be contained with this support level & resistance above at 106-23+. Should a failure of 106-13 materialize in today's otherwise uncommitted trade, the next level should show up around 106-08.