SubscribeDaily Futures Commentary May 20, 2009
Wednesday, May 20, 2009
Treasuries are trading mixed this morning. There is slight pressure on the June Bonds while June Notes are flat. Growing confidence in the global economy is encouraging investors to forego the relative safety of the U.S. debt market for higher yields in other asset classes.
The Federal Reserve will be buying debt this morning in conjunction with its long-term quantitative easing plan. This is expected to ease any sudden spike in interest rates. Tomorrow the Treasury will announce the size of next week’s two, five and seven year debt auction. The combination of these two events is helping to hold Treasury futures in a range.
June T-Notes have retraced its recent range of 119’22 to 122’02. This retracement zone is 120’28 to 120’19. Regaining 120’28 will be a sign of strength.
June T-Bonds are holding inside its retracement zone at 121’19 to 121’03. This is providing some stability to the market this morning.
Depending on how investors feel today about the prospects of an economic recovery, it is possible that the Notes and Bonds can launch the start of a counter-trend rally from both of these …
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