As Always End of Week Market Action Creates Fresh Opportunities
Written by Al Martin Sunday, 13 September 2009 19:55
(9-13-09) We saw last week's series of US Treasury Bond auctions well-received. As a consequence, we saw the December Bond contract bid up Friday to trade above 121 before getting some vertigo. We have seen this phenomenon before when the Bonds have gotten vertigo above 121. The contract fell back to 120.14 on the close. However we believe that this contract will see 121 and higher in next week's trade.
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Late Week Market Action Creates Opportunities for Next Week's Trade
Written by Al Martin Monday, 07 September 2009 16:32
(9-6-09) In Friday's session we saw the Long Bond contracts fall a point-and-a-half, resuming the Friday pattern before fresh Treasury supply in the coming week. We had shorted the Bonds in Friday's trade at 119.16, at which time the Bond contract generated a daily sell signal.
The Sep. Dollar contract continues to be a buy-on-dip trade, continuing to trade in the 15 day range of 78.00 – 79.00. We continue to buy the Dollar on dips.
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Commodity Prices Begin to Lag the Equities
Written by Al Martin Sunday, 23 August 2009 22:16
The USU contract fell back sharply Friday, as the contract above 120 became a sell, given next week’s $110 Billion in fresh paper coming to market. Also nervousness generated over the rising speculative bubble in equity prices is beginning to pressure bonds.
Overbought in Fantasyland
Written by Al Martin Sunday, 26 July 2009 00:00
Equities continue to be stretched as technically overbought indicators increase.
We saw last week that 83% of the S&P 500 was once again trading above its 200-day moving average, thus generating another RSI sell signal. We also see that the 30-day CBOE Vix & NASDAQ Vix are also signaling an technically overbought condition in their respective indices. We feel that equities with diminishing volume have gotten all they can out of near term earnings, and it is likely that the best of earnings season is now behind us. We would expect equities to fall back in the coming week.
Bonds – trading in the USU contract also suggests that the equities are extremely overbought, the yields climbing at the long end. You see the bonds forming some base around the 116.00 level. Remember, we have $115 Billion of fresh bonds coming in the week’s trade, and we expect the USU contract to remain under pressure.
It's Still a Day Trader's Market
Written by Al Martin Sunday, 19 July 2009 00:00
We had warned last week that the Sep. Long Bond contract was dangerously overbought. Indeed we saw the contract fall precipitously -- 4-1/2 points, week over week, the third largest weekly decline since the bonds began trading in 1977. We hope our readers took advantage of this decline. As we said, we were short-sellers at 120 or better and have now begun to trade the bonds on the long side, since we think they have corrected. Technically the speculative excesses that existed in the bonds have been largely weeded out, and we think that the bonds have now returned to a buy-on-dip trade.
We continue to scalp the Sep. Dollar contract on the long side. Do not be frightened of the late-week declines. Much of this was technically oriented in the Yen-Euro and Yen-Sterling cross-trades. Dollar contract intra-day volatility is increasing, but that does not change the buy-on-dip trade.
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