The FEAR of a weak dollar ( the dollar has tumbled 44% since October 2000 and 15% this year alone ) can cause foreign investors to sell-off their U.S. stocks and bonds for fear of an even weaker dollar. This is what happened in the Fall of 1987. Things always seem to get to a CRISIS POINT, and a sharp puke in the dollar usually leads to a stock-market correction, ala: '87
Well the Bonds sure as hell didn't like the announcement! Dropped a full point and making new lows since the initial upside pop. :eek:
all it did was retrace fridays wild up move on the employment report. I wouldn't call it panic city otherwise the 10year would not have stopped on a dime at '25. now it may drop more but it was set on retracing the upmove. good trading to you ..of course hindsight is 20/20 and its easy for me to say the above after the fact :eek:
I think that the Bonds are starting to "sniff-out" the fact that M2 and M3 are continuing to decline . . . this has been going on for 3 months now!
Treasuries have traded back through to new highs on the session on very spotty volume. The long end is outperforming the shorts, with the thirty-year running the yield down to 4.981%, seeking levels from mid-November. The Philly Fed number garnered a bit of a sell-off in the short end while the tens and thirties sold off going into the release. The ten-year has rallied much of the day; pushing yields off to 4.151% from an early 4.209% and is currently +03/32nds to yield 4.168%. All the usual suspects (lack of liquidity, lack of inflation, lack of support for the dollar) are being cited for the day's action. Twos are -01/32nds to yield 1.826%; threes are -03/32nds to yield 2.351%; fives are -02/32nds to yield 3.194%; thirties are +14/32nds yielding 4.992% - Briefing.com I am sitting on a short at 110-6 and not feeling too good about it...rcm
when I am stuck in a position .... and if I think the 10 yr is trading at a diff value than where it usually trades compared to the 30 yr ... I hedge myself and hope things get back in line of course ... if it is a big fund changing its bet on the yield curve I can be right and still be wrong