carleygarner
Well-known member
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July 21st, 2010
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Risk trade....OFF!
Investors clamored to Treasuries as many of them are rethinking the "risk trade". Money is clearly moving toward safe havens such as the U.S. dollar and the U.S. backed fixed income products...particularly short-term instruments.
Most of the day's buying came on the heels of testimony by Bernanke that suggests a largely uncertain economic outlook and low inflation (a bit short of deflation) and given the proposed budget cuts supply concerns have been put on the back burner. Even if large auctions continued Bernanke reassured the markets that foreign demand for Treasuries remains strong.
All in all, Bernake's statements weren't necessarily shocking nor were they new. Nonetheless, the day's events were overall bullish for bonds and notes. Therefore we feel as though we could finally reach our upside target in the September bond futures of the mid 129's to 130ish and just over 124 in the 10-year note. Like we said yesterday: "Nobody has a crystal ball, but the environment is ripe for a bull trap. It seems somewhat likely that Treasuries could see some sort of spike high as buy stops are elected but we doubt that any large gains would be sustainable."
If you have been patiently waiting to play this market from the downside, the mentioned areas should be a good place to start.
* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.
**Seasonality is already factored into current prices, any references to such does not indicate future market action.
Treasury Bond and Note Option Trading Recommendations
**There is unlimited risk in naked option selling.
Flat
Treasury Bond and Note Futures Trading Recommendations
**There is unlimited risk in trading futures.
Flat
*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.
There is substantial risk of loss in trading futures and options.
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
~Come and trade with us at DeCarley Trading to get these reports delivered to your inbox daily~
Risk trade....OFF!
Investors clamored to Treasuries as many of them are rethinking the "risk trade". Money is clearly moving toward safe havens such as the U.S. dollar and the U.S. backed fixed income products...particularly short-term instruments.
Most of the day's buying came on the heels of testimony by Bernanke that suggests a largely uncertain economic outlook and low inflation (a bit short of deflation) and given the proposed budget cuts supply concerns have been put on the back burner. Even if large auctions continued Bernanke reassured the markets that foreign demand for Treasuries remains strong.
All in all, Bernake's statements weren't necessarily shocking nor were they new. Nonetheless, the day's events were overall bullish for bonds and notes. Therefore we feel as though we could finally reach our upside target in the September bond futures of the mid 129's to 130ish and just over 124 in the 10-year note. Like we said yesterday: "Nobody has a crystal ball, but the environment is ripe for a bull trap. It seems somewhat likely that Treasuries could see some sort of spike high as buy stops are elected but we doubt that any large gains would be sustainable."
If you have been patiently waiting to play this market from the downside, the mentioned areas should be a good place to start.
* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.
**Seasonality is already factored into current prices, any references to such does not indicate future market action.
Treasury Bond and Note Option Trading Recommendations
**There is unlimited risk in naked option selling.
Flat
Treasury Bond and Note Futures Trading Recommendations
**There is unlimited risk in trading futures.
Flat
*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.
There is substantial risk of loss in trading futures and options.
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
