Adding a New Commentary Post
Record demand for the two year note along with a weak stock market kept a bid in treasuries yesterday. After the bad 2 and 5 year auctions two weeks ago, it was a surprise to see such a high bid-to-cover ratio in the 3 year auction yd with 62% of the auction going to indirect bidders. Could the stronger than expected headline NFP report have helped the three year auction? I suspect it might have.
Support targets above last week’s NFP low are 11608-11613. This is the June 24 FOMC low and 50% retrace to the NFP low. The extended target is the 78% retrace to the NFP low and July 29 five yr auction low at 11515.
