Showing posts with label FOMC. Show all posts
Showing posts with label FOMC. Show all posts

Tuesday, February 26, 2013

February 26, 2013 HFT Bonds & Notes commentary with @GCavaligos

February 26, 2013 HFT Bonds & Notes commentary with @GCavaligos SocialTwist Tell-a-Friend
Take advantage of our 7 DAY FREE TRIAL to George's service. Click our link to access. We look forward to seeing you there.

HFT Bonds with Daily video from Bonds Strategist, George Cavaligos. Take a look at what we do here:

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Wednesday, September 12, 2012

Daily Market Commentary

Daily Market Commentary SocialTwist Tell-a-Friend

Monday, September 10, 2012

Daily Market Commentary

Daily Market CommentarySocialTwist Tell-a-Friend

Wednesday, August 1, 2012

Daily Market Commentary

Daily Market CommentarySocialTwist Tell-a-Friend

Tuesday, July 31, 2012

Daily Market Commentary

Daily Market CommentarySocialTwist Tell-a-Friend

Wednesday, June 20, 2012

Daily Market Commentary

Daily Market CommentarySocialTwist Tell-a-Friend

Tuesday, June 19, 2012

Daily Market Commentary

Daily Market CommentarySocialTwist Tell-a-Friend

Thursday, October 6, 2011

Special Market Report: FED Operation Twist & Curve Flattening (George Cavaligos)

Special Market Report: FED Operation Twist & Curve Flattening (George Cavaligos)SocialTwist Tell-a-Friend - With the FED's Operation Twist program starting this week, George Cavaligos (MF Global) gives us a look at the curve flattening on the 10-30 Yr Curve as George previewed in the FED update video. George goes over some potential target levels in the 10-30 Yr spread trade as well as developments in the technical patterns of the 10-Year December contract.

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Thursday, September 22, 2011

Special Market Report: FED's Operation Twist Bond Market Effects (George Cavaligos)

Special Market Report: FED's Operation Twist Bond Market Effects (George Cavaligos)SocialTwist Tell-a-Friend - George Cavaligos (MF Global) follow-up video after the Federal Reserve's FOMC meeting. George explains the effects the FED's "Operation Twist" is having on the bond market (as previewed in the 9/20/11 video).

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Tuesday, September 20, 2011

Special Market Report: FED Prep - 30 Yr Treasury Yields vs. 10 Yr Note Yields (George Cavaligos)

Special Market Report: FED Prep - 30 Yr Treasury Yields vs. 10 Yr Note Yields (George Cavaligos)SocialTwist Tell-a-Friend
MF Global Bond trader George Cavaligos discusses the FOMC meeting and that the Federal Reserve could use yields as one of it's tools to help the economy.

According to George:
" 30yr treasury yields are the only part of the Treasury curve not to get below the 2008 lows at this point. That fact has me favoring the FOMC meeting moving towards an "Operation Twist" that will target this fact and try to push 30yr yields down. The 2008 lows in 30yr was 2.52% and bonds are currently yielding 3.21% that 0.69% difference may be enough to help stabilize the economy, or at least put a floor under it. We continue to like buying dips in the bonds and would take a look at selling the notes/bonds spread that we floor traders' call the NOB spread. In the futures pits we usually use a ratio to equate the different contracts of 10 T-Notes to 6 T-Bonds."

Wednesday, August 12, 2009

The Day After FOMC

The Day After FOMCSocialTwist Tell-a-Friend

This chart is courtesy of our newest HFT Chat Moderator, Scott McCray.

Scott McCray, former anchor at Los Angeles Ch 22 Biz TV (the precursor to CNBC), has accepted our invitation to be a Chat Moderator in our HFT Chatroom. Scott is an active options and futures trader with great point of view on Gold, Crude Oil and Stock Index Futures. He was the first person to quote our Dollar Weighted Put/Call Ratios on the air back in summer of 2000.

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Monday, December 17, 2007

Equity Index Update (Special Edition)

Equity Index Update (Special Edition)SocialTwist Tell-a-Friend
Brad Sullivan

Monday December 17, 2007

The index markets were weighed down on Friday with the release of a stronger than anticipated CPI reading. Volume flows were on the lighter side as interest in the trade was pretty muted…however, the SPZ did end the session lower by -1.5% and settled at session lows of 1478.50. This morning, the index is called to open lower at 1473.50 (-5.50) on the session. This marks a new low for the month of December and it is a month that can only be described as schizophrenic thus far.

Consider that this month has a significant historical upside bias and after early selling, the indices responded with a tremendous upside push. That push higher was unwound last Tuesday as the FOMC failed (in the market’s eyes) to respond appropriately to the current credit issues in the global market…throw in a little inflation fear and things are not looking as good as the buy side would have hoped.

Along these lines let us examine the movement post FOMC announcement and the subsequent joint injection of reserves by the chorus of global reserve banks. It is worth noting that in absolute value, it was the greatest move in the history of the SP futures from 1:30cst to the close and close to the 8:30 open on Wednesday…85 total SP POINTS. Since that time the indices have moved lower in a grinding fashion with each bounce failing to attract buyers at higher levels. With the SP now trading at -1.5% for the month and closing about the same distance below its 200 day MA (-1.5%) one has to wonder if the die has been cast and lower prices are ahead.

One thing that appears to be in store is a dialing down of intraday volatility. While the absolute moves have been large, the session range continues to tighten and for day traders that means to tread with caution. It is certainly worth pointing out that in the last 12 years there have only been 7 sessions with a high to low range of more than 45 SP points. The range on Dec. 11 was 56 points and on Dec. 12 46 points. The last time it happened was Jan. 3, 2001 (surprise mid-day rate cut), where a 46 point range was preceded by an 81. Clearly there is some position movement and it appears that the group that has blinked first is the long side.


Editors' Note: Brad Sullivan's comments are posted each day near the Cash Open in our SuperPlatinum Virtual Trading Room.

Sunday, October 28, 2007

HOTS Weekly Options Commentary

HOTS Weekly Options CommentarySocialTwist Tell-a-Friend
Peter Stolcers

Last week, the market tried to recover from the 350+ point Dow Jones drop on Friday. That first round of earnings featured financial stocks and their big write-downs spooked the market. As I mentioned in last week's commentary, I felt that the market would stabilize this week once a broader mix of earnings were released.

Through the course of the week we caught a performance glimpse from many different groups and sectors. The news was good overall and the guidance was decent. If you strip financial stocks out of the earnings picture, corporations have posted a 3% growth rate. That is much better than the flat earnings growth rate has been projected. The market found its footing and about one third of the companies in the S&P 500 have reported.

Next week is the “grand daddy” of all news weeks. We have an FOMC meeting, the Unemployment Report, and the busiest week of earnings releases. I believe the Fed’s dramatic action during the last meeting will give them a "free pass" this time around. They have made it clear that they are carefully monitoring economic conditions and they will do what it takes to keep us from going into a recession. Many analysts are looking for a .25% rate cut. If they don't get it, I feel the market will be accepting if the news includes dovish rhetoric. The dust will settle for a few days and the market will wait for the Unemployment Report. If we do get a rate cut, we will be off to the races.

Last month's employment figures were much stronger than expected. With the exception of the August number, the market has been able to rally after every Unemployment Report this year. I believe the employment picture is sound and the market will rally after the number.

Microsoft has been a dormant stock for many years and on Friday it staged a major breakout. It is a mega cap stock and it could lead the sector higher if it wakes up. Tech has been relatively strong recently and the sector could lead the market higher if the earnings continue to beat. The QQQQ is still only half of its “tech bubble” peak. Financial stocks are weak and the market needs leadership from the tech sector if it is going to stage a sustained rally. In the chart you can see how well the QQQQ has performed. It is bumping up against the relative high and it is poised to breakout.

These are some of the earnings highlights for the week ahead: ASH, CAN, HUM, K, RSH, SCHN, ATHR, FTI, OSG, SOHU, UHS, VTRX, AMED, AVP, BJS, CRDN, CL, ENR, CMC, FPL, RAIL, GT, HLT, MGM, ODP, PG, TEVA, TRW, X, UA, BWLD, CMG, DWA, FIC, GPRO, IVGN, LNET, MCK, RTI, PCU, WBSN, CCJ, CRS, GRMN, KFT, COL, SPW, RIG, WY, ANDE, ABX, XRAY, FMC, MTW, PHRM, TK, AGU, AZN, BDX, CAM, CVS, DNR, XOM, GTI, IGT, MRO, PCS, OSK, ROK, TBL, UTHR, WMB, CLF, CROX, CYTC, ERTS, GES, OII, WLT, WDC, CVX, EDS, IP, OMG, TLM. I see more good than bad in this list and the numbers should have a positive influence on the market.

We are headed into one of the most bullish periods of the year and I expect a year-end rally. Given all of the news next week, the market will find a catalyst to push it to new highs. End of month buying will also help to support prices.

Friday, October 12, 2007

Equity Index Update (Special Edition)

Equity Index Update (Special Edition)SocialTwist Tell-a-Friend
Brad Sullivan

The index markets suffered through a sharp decline in the afternoon trade after a JP Morgan analyst cut revenue estimates for the Chinese Internet company BIDU ( The stock plunged from 358 per share to 303. Other staples of the momentum side also slid as GOOG dropped from a new all-time high of 641 to 622 on the close…AAPL fell sharply as did DRYS. The NQ market participants were clearly caught off guard as the index cratered from 2210 to 2160 in 30 minutes of trading…the subsequent bounce proved short lived and another round of selling pushed the index to the session lows of 2146 a solid -2% drop for the afternoon from high to low.

The interesting aspect of the decline was the second wave of selling. It was during this wave that the broader market came along for the ride on the downside…GS gave back its entire session from Tuesday’s FOMC minutes rally and the stock settled at 229. The examples of this type of price action were found everywhere by the close and one has to wonder if a confluence of forces that have been the underpinning of this rally (global growth, commodity boom, no inflation…so on so on) is being rethought. Certainly, a one day reversal should not cause a top in this long running bull market…and for the bears hoping that we have finally turned the cards over to the “sell” side of the ledger I would advise caution. There needs to be more technical work done on the downside in order to generate a price ceiling of significance. In the short run, it would appear that a rally back to yesterday’s highs would be a stretch. So…where does that leave us?

From a day trading perspective, much of the move was accomplished (at least in terms of velocity and price discovery) in yesterday’s swoon. The SPZ went BELOW the September Employment Report session low (1558.25) and some mild sell stops pushed the index to session lows of 1556.25. However, this low was still HIGHER than the GAP left from that very Employment report (1552.25). The subsequent short covering bounce into the close pushed the index towards 1565 – that close is on slightly lower on the week and does not represent the low close of the week as that was accomplished on Monday at 1562.75. In fact, only the NQ and ER2 contracts closed at new weekly lows. Essentially, this boils down to patience and a little bit of reality. Yes the markets are overextended and the fact that a revenue downgrade of a Chinese Internet company could put so much pressure on the marketplace proves that point. However, to make the leap from the trade in BIDU to an overall slowing of the China Story may be a bit of a stretch. In my opinion, we witnessed a rare news event that led to a bit of a buyers strike. Whether or not that continues today will be fascinating, particularly as we head into earnings season. My advice is to lay low and look for a few opportunities, particularly early, for selling rallies. Psychologically the market took a hit and some of that should carry into today.

Saturday, September 15, 2007

HOTS Weekly Options Commentary

HOTS Weekly Options CommentarySocialTwist Tell-a-Friend
Peter Stolcers

Let me start by welcoming many new subscribers this week. I live for set-ups like the week ahead and the opportunities are lining up. I’m glad to have you onboard!

This is the calm before the storm. Last week the market rallied on expectations that the Fed will lower rates. The debt market has priced in a 70% probability of a .25% rate cut and the 30% probability of a .50% rate cut. The dismal Unemployment Report dramatically increased rate cut forecasts.

The U.S. dollar hit new 30-year lows against the Canadian dollar and against the Euro this week. We have a huge trade imbalance and a weak dollar forces us to pay more for the goods we import. Translation: a weak dollar is inflationary. Oil has just hit an all-time high. Last week, TSN said that profit margins are being hurt by higher food costs. I've even heard that Italians are boycotting pasta because wheat prices have forced it up 25%. There are countless examples of inflation (tuition, health care, local taxes) that don’t show up in the Fed’s numbers. Tuesday, a “hot” PPI number could add to the excitement.

I believe the Fed will reluctantly lower interest rates by .25% next week. They will lace their rhetoric with inflationary comments to curb future rate cut expectations. The market will have an initial negative reaction.

The earnings releases by LEH, GS and BSC will be much more important. To a degree, the Fed’s actions are priced in. However, no one really knows the earnings impact from the sub-prime/credit crunch debacle. Historically, LEH has made a 2% move after releasing its earnings. The option implied volatilities are pricing in an 8% move in either direction. Lehman releases before the open Tuesday while Goldman Sachs and Bear Stearns will be releasing earnings Thursday, after the Fed's decision. FDX also announces this week and transportation activity measures economic strength. GIS and CAG will shed light on food costs.

Earnings and the Fed’s actions/statements will determine the market's direction for the next month. Quadruple witching will throw gasoline on the fire, accelerating the move. All you can do in these situations is to have your stocks lined up. We will trade relative strength and weakness in a balanced manner.

Wednesday, April 11, 2007

Equity Index Update

Equity Index UpdateSocialTwist Tell-a-Friend
Brad Sullivan

The index markets continued to trade in a narrow range with a sustaining bid underneath the current pricing zones. Activity was light as volume flows are running at a -30% clip in some of the indices versus their respective YTD averages. This afternoon will bring the release of the Minutes from the last FOMC meeting and should spark some bit of trading activity. In addition Dr. Bernanke will speak in Washington and Richmond Fed President Lacker will speak on the economy in Charlotte. Given the lack of movement, I have included 5 charts today, 4 of which are focused on the MA % differentials since the start of 2007. The other chart continues to show the strong correlation between the YEN and SP.

Monday, April 9, 2007

Bond Market

Bond MarketSocialTwist Tell-a-Friend
Sally Limantour

Friday’s non farm payrolls number was a bit of a shock and has dashed any hopes of a rate cut in the near future. Revisions of the past two months were strong and the unemployment rate fell to 4.4% matching a low back in May 2001. Interesting too was the strong leap in construction employment in an industry that has negative headlines on a daily basis. Remember that February’s number was quite negative and the 56,000 new jobs created in March construction is most likely an adjustment. The important thing is the trend and the direction for the past three months in construction employment is still down.

As of April 3rd the COT report showed the spec and fund combined net short position of
126,351 bond contracts. We have to assume this position is larger as the market is a full point lower now and it will be important to see the COT report this Tuesday. The 109 level I have been looking for in the Treasury bond futures (USM7) is close at hand and although the COT reflects a large short position amongst the spec community, bond prices can still go lower before a good bounce. In fact, many times I have seen bond prices move an additional 3-4 points even with an extreme COT position.
Talk of interest rate cuts will now be on the back burner as the Fed will remain on hold. Inflation is ticking up and having just returned from the Bahamas where I attended the Natural Resource Summit of the Americas, I am still convinced we are in a major bull market in commodities and this sector will outperform. It is both a supply and demand issue in many of the raw materials and we should see opportunities ahead in the base metals, precious metals, molybdenum (try saying that word three times fast) uranium, energy, alternative energy, water supplies and food. This is a theme I will continue to cover and focus on both in futures and the natural resource stocks.

Looking ahead in bond land this is a slow data driven week with the biggest news coming on Wednesday as the FOMC releases the minutes from March 21. Following this we have Chicago Fed Moskow speak about the US economy, then Thursday’s chain store sales and Friday’s report of the PPI, the Uni. of Michigan Consumer Sentiment and the international trade numbers for February. It is not inconceivable for the 30 year Treasury bonds to trade back to long term support at 108.00.

Thursday, March 22, 2007

Equity Index Update

Equity Index UpdateSocialTwist Tell-a-Friend
Brad Sullivan

“Coleman, it was all a dream, a terrible awful dream.”
So says Louis Winthorpe III in Trading Places

Indeed shorts came across one of the most painful of sessions in a long, long time. Wasn’t it just a scant week ago that the SPX undercut the trading low for our recent move lower and the DJIA broke below 12,000? Ah, what a few words – or in this case, absence of wording can do for a marketplace. In removing the tightening bias from their statement, the FOMC set off the buy stop heard round the world. How aggressive was the pandemonium? In the first 5 minutes after the announcement, the SPmini contract traded over 124,000 contracts with a face value of NEARLY $9BILLION. At the end of the first 30 minutes of trading post – FED, the contract traded a value of over $33 BILLION.

Rumors were abundant that institutional buy stop orders were triggered above 1430, 1437, 1441 and 1445 in the SPM7 contract. By the time the bell rang the indices, as a collection, rested just beneath February 27th levels and have seemingly announced to the world that this correction has run its course. Again…what a difference a week makes. One interesting area of trading has been the performance of the long end of the curve since the announcement. Initially, the bonds surged higher…today they rest -18/32 from yesterday’s close as players have time to reassess some of the initial thoughts. For index buyers this is not the scenario they wish to play out. Keep a close eye on potential trigger points across all markets the next several days as we adjust to this new found optimism.

A quick note on the internals…the NDX cumulative breadth reading (2006 start date) has rallied significantly since last week and now rests just below recent highs. In addition, the SPX (top 100 issues only) cumulative breadth reading reached a new high with yesterday’s close (2006 start date). These readings are used as a thermometer, and right now it appears as though there may be more upside to come.

Wednesday, February 21, 2007

Market Timing

Market TimingSocialTwist Tell-a-Friend
Fari Hamzei
February 21, 2007

Timer Chart tells us there is a good chance we would be taking another pause here (McClellan Oscillators and large cap index prices are diverging).

January FOMC Minutes just released half an hour ago are supportive for the market: economic expansion remains 'resilient', data suggest 'leveling out' in housing.


Read more about why Market Timing matters in BusinessWeek, February 19 issue, pp 80-81:

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