ALARON US TREASURY FUTURES REPORT 04/27/09
ECONOMIC DATA 04/28/09: all times EST
- 10:00 AM US CONSUMER CONFIDENCE (30.0)
- 1:00 PM US 5 YEAR NOTE AUCTION ($35.0 B)
- FOMC MEETING BEGINS
SUMMARY OF DATA
NO MAJOR ECONOMIC RELEASES. RESULTS OF US 2 YEAR NOTE AUCTION ($40B) BID TO COVER 2.72, YIELD 0.94%, COUPON RATE 0.87%.
TREASURY FUTURES REBOUND AS CONCERNS REGARDING SWINE FLU INFLUENCE ON ECONOMIC RECOVERY OVERSHADOWS LUKEWARM US 2 YEAR NOTE AUCTION.
US TREASURIES staged a rebound from last week’s break of support as expanded concerns regarding the spreading of a swine flu outbreak. Fears created a move to security as both Treasuries and the US dollar gained favor as hedging vehicles in the wake of a potential breakdown of an already fragile economic stabilization.
The move higher in Treasuries began in the overnight session as new cases of swine flu were reported in Spain, China, and the United States. The death toll has risen to over 100 and concerns regarding possible travel and trade restrictions overshadowed negative market sentiment that would have likely been stronger in the wake of a mediocre auction of $40 billion of US 2 year note debt. Auction results followed their recent pattern as a respectable bid to cover ratio of 2.72 was achieved at the cost of a significantly higher yield vs. the coupon rate (.94% vs.87%). Further negative sentiment regarding supply should emerge this week as the remaining auctions are for longer yielding debt which is more susceptible to inflation and competition from higher yielding investments. Tuesday will see an auction of $35 billion of US 5 year notes.
Technically, June 30 year futures have moved off a key support level of 124.05. The move higher appears to set up to challenge resistance at 125.180. A move above this level would need to challenge the 126.165 level to confirm a new range. Failure to breech and hold above this level leaves the market vulnerable to retest support and the low end of the range at 123.030. There appears to be some support at 122.180. Below this level, there appears to be no significant support until the 120.310 level.
|
US DEBT FUTURES |
OPEN |
HIGH |
LOW |
CHANGE |
|
|
US M9 (US 30 YRS) |
124.120 |
125.045 |
124.000 |
125.010 |
+25.5/32nds |
|
TY M9 (US 10 YRS) |
121.225 |
122.110 |
121.210 |
122.095 |
+24/32nds |
Prepared by Rich Roscelli & Paul Brittain.
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. Alaron Trading Corp. its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. 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.
