Commodity TRADING SCHOOL
COMMODITY TRADING SCHOOL US FIXED INCOME REPORT 07/20/09
SUMMARY OF DATA 07/21/09
- 10:00 AM FED CHAIR BERNANKE BEGINS TESTIMONY.
DATA RESULTS 07/20/09
US LEADING INDICATORS (0.7% VS. 0.5%)
DEBT MARKETS REBOUND FROM EARLY LOWS AS MARKETS AWAIT FED CHAIRMAN TESTIMONY WITH POSSIBLE OUTLINE OF STIMULUS EXIT STRATEGY.
US TREASURIES staged a strong rebound from overnight lows. The markets reversed from overnight negative sentiment on expectations that testimony from Federal Reverse Chairman Bernanke scheduled to begin Tuesday may offer insight into the possible “exit strategy” for the most aggressive fiscal stimulus program since the Great Depression.
While the majority of analysts and financial forecasters suggest that the major portion of a pullback will not take place until well into 2010 or 2011, any notion of a possible end to the record levels of debt pummeling the marketplace was enough to offer a lifeline to Treasury bulls for the time being. Additional support for Treasuries came from the belief that tomorrow’s testimony may offer alternative strategies to defend the longer end of the yield curve in an effort to support the next stage of the housing recovery, where home prices hopefully find a bottom and stage a manageable rebound.
The markets also entered a “buy American” sentiment across most markets after CIT offered a sense of relief as the commercial lender has found the means to restructure its debt issues and forestall another high profile corporate bankruptcy.
TECHNICAL OUTLOOK-US 30 YEARS- US 30 years rebounded from a 61.8% Fibonacci retracement level in the 115-260/115-280 range. Resistance forms at 117-180. Markets may be subject to fundamentally driven swings which could result in spikes to 118-160. Once through this volatility, looking for market to pullback and retest 115-150.
US 10 YEARS- US 10 year notes continues to form a step down pattern on chart. Market seems to have less upside volatility and should pullback to 116-070. Market could be range bound between here and 117-160.
EURODOLLARS- December Eurodollars continue to set as a scale trade. Resistance for contract sets in at 99.280. Look to take opportunities to short Dec & March 2010 contracts at these levels for long term scale in. Next level of resistance sets up at 99.310.
|
US DEBT FUTURES |
OPEN |
HIGH |
LOW |
CHANGE |
|
|
US U9 (US 30 YRS) |
116-040 |
117-110 |
115-135 |
117-060 |
+29.5/32nds |
|
TY U9 (US 10 YRS) |
116-105 |
117-040 |
115-265 |
117-000 |
+19.5/32nds |
|
ED Z9 (EURO $) |
99.230 |
99.270 |
99.210 |
99.260 |
+3.00 |
Prepared by Rich Roscelli & Paul Brittain.
EMAIL QUESTIONS OR COMMENTS TO RICH@BINVSTGRP.COM
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. Whitehall Investment Management, 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.
