derivatives

Short Squeeze Triggered with Room to Run

Posted in U.S. T-Bond, U.S. T-Note, derivatives on February 11th, 2009 by Commodity Trader – Comments Off
The financial markets expressed their discomfort with the lack of details provided on the restructured TARP plan and the uncertainty over the economic stimulus package. Equities seemed to slide off of the cliff, while Treasuries finally experienced the short covering rally that we have been looking for. Trade was thin, and seemed to get thinner as the afternoon hours approached. It is apparent that many speculators weren't willing to accept the possibility of excessive volatility at the hands of our elected officials...and I can't say that I blame them.

Bank Realities Return to Wall Street

Posted in Dow, S&P 500, derivatives, economics on February 4th, 2009 by Commodity Trader – Comments Off
As the financial sector rescue plan remains in limbo, investors are growing increasingly uneasy with equities. Bank of America shares weighed heavily on the Dow pushing the index well below the coveted 8,000 mark and causing it to under perform relative to the other indices. There wasn't a lot of economic data for the market to mull over, but the intraday headlines offered significant guidance. The market's attention was focused on Obama's new cap on executive pay to firms tied to bailout money and the Madoff probe in Washington.

Treasuries on the Long End of the Curve

Posted in T-Bond Futures, derivatives on February 3rd, 2009 by Commodity Trader – Comments Off
Indecisive equities and even less certainty in Washington aided a short covering bid in Treasuries. The 30-year bond and the 10-year note enjoyed a bulk of the buying while the short end of the yield curve dragged a bit. Many analysts attributed the buying to a flight to quality bid, but in my opinion, it was likely driven by technical short covering. With today's gains, the yield on the March T-Bond is nearing 3.5% and the note slipped to about 2.75%. Yesterday's weak data was relatively bond friendly. The ISM manufacturing index came in at 35.6, dismal but better than the expected 32. Likewise, personal income shrunk at a slightly smaller pace that most were looking for, but a negative number is far from promising.

Battle of the Titans

Posted in Federal Reserve, TARP, derivatives, economics, forex, inflation, traders, volatility on January 14th, 2009 by Commodity Trader – Comments Off
For those of you that prepare yourselves, the OPPORTUNITIES will be abundant and limitless; for those that don't it could be a very difficult period. "Volatility is OPPORTUNITY" and it is still set to skyrocket as G7 Public servants, financial and banking sectors and their crony capitalist campaign supporters try to escape INSOLVENCY and transfer it to the public. Ultimately they will fail, but the process may take several more years as they BELIEVE they have the ability to print money and create credit out of thin air endlessly.