ALARON US TREASURY FUTURES REPORT 04/08/2009
ECONOMIC DATA 04/09/2009: all times EST
- 8:30 AM INTERNATIONAL TRADE (-$36.5 B), US WEEKLY JOBLESS CLAIMS (664 K)
- 10:35 AM EIA INVENTORY NUMBERS (NAT GAS)
- 1:00 PM US 10 YEAR NOTE AUCTION ($18 BILLION)
04/08/09- US WHOLESALE TRADE (-1.5% VS -0.7%) , EIA INVENTORY (OIL & PRODUCTS) CL +1.7 M, RBOB +0.66 M, DISTIL -3.0 M US 3 YEAR NOTE AUCTION ($35 BILLION) BID TO COVER 2.42, YIELD 1.385% 2:00 PM FOMC MINUTES.
US TREASURIES TRADE HIGHER. RECORD 3 YEAR AUCTION OFFERS FEW SURPRISES, FOMC MINUTES CONFIRM UNANIMOUS SUPPORT FOR FED DEBT PURCHASE PLAN.
US Treasury futures traded higher, but remained within its recent range, as a record $35 billion of US 3 Year notes did not offer any surprises to the market and minutes from the FOMC meeting confirmed the committee was united in its plans to support Treasuries through scheduled purchases of $300 billion. Treasuries also received additional support from buyers seeking shelter from the volatility of equities, especially during earnings season.
The results of the US 3 year note auction were essentially mixed. A strong bid to cover ratio of 2.42 was achieved at the cost of a higher than expected yield than the face or coupon rate (1.385% vs. 1.375%). Non dealer interest was noted as strong, suggesting that this benchmark debt instrument for the recession/recovery period remains well supported. Treasuries remained essentially unchanged after the auction results. Further gains took place after the release of the FOMC meeting minutes from March. The minutes confirmed a united front and unanimous support for the Federal Reserve’s plan to support economic stability by purchasing significant levels of US Treasury Debt. Gains also held to the upper end of recent ranges as traders and investors seek security ahead of the holiday weekend and equity volatility during the ebb and flow of earnings season.
Technically, June 30 Year Futures show no sign of leaving the nest (or channel). Recent gains measured against 30 and 60 min RSI (Relative Strength Index) suggest that the market may be getting somewhat overbought. Upside likely to find resistance at 128.220. A small correction may take place ahead of the holiday weekend down to a 126.240 support level. Break out support and resistance levels remain at 125.120 and 131.080.
|
US DEBT FUTURES |
OPEN |
HIGH |
LOW |
CHANGE |
|
|
US M9 (US 30 YRS) |
126.260 |
127.295 |
126.220 |
127.190 |
+26/32nds |
|
TY M9 (US 10 YRS) |
122.060 |
122.265 |
122.035 |
122.240 |
+18/32nds |
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.
