Archive for Bonds

COT Bonds Futures Charts: 2-Year, 5-Year Treasury Notes, Eurodollars, Fed Funds

By CountingPips.comReceive our weekly COT Reports by Email

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday March 02 2021 and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.


30-Day Federal Funds:

30-Day Federal Funds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 7.1 72.2 1.8
– Percent of Open Interest Shorts: 18.3 60.2 2.5
– Net Position: -111,057 118,220 -7,163
– Gross Longs: 69,511 711,875 17,501
– Gross Shorts: 180,568 593,655 24,664
– Long to Short Ratio: 0.4 to 1 1.2 to 1 0.7 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 15.6 84.4 58.1
– COT Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -18.6 18.0 3.7

 


2-Year Treasury Note:

2-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 18.0 73.7 6.7
– Percent of Open Interest Shorts: 29.3 64.5 4.7
– Net Position: -257,527 211,452 46,075
– Gross Longs: 410,969 1,682,377 153,211
– Gross Shorts: 668,496 1,470,925 107,136
– Long to Short Ratio: 0.6 to 1 1.1 to 1 1.4 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 33.3 58.1 59.2
– COT Index Reading (3 Year Range): Bearish Bullish Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 5.8 -0.2 -14.2

 


5-Year Treasury Note:

5-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 20.0 70.5 7.6
– Percent of Open Interest Shorts: 19.2 68.7 10.1
– Net Position: 26,487 60,979 -87,466
– Gross Longs: 699,766 2,467,626 266,697
– Gross Shorts: 673,279 2,406,647 354,163
– Long to Short Ratio: 1.0 to 1 1.0 to 1 0.8 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 92.8 15.2 41.5
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 27.5 -18.4 -21.3

 


10-Year Treasury Note:

10-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 15.0 72.1 8.8
– Percent of Open Interest Shorts: 17.7 64.3 14.0
– Net Position: -95,611 278,002 -182,391
– Gross Longs: 534,323 2,563,667 314,620
– Gross Shorts: 629,934 2,285,665 497,011
– Long to Short Ratio: 0.8 to 1 1.1 to 1 0.6 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 72.7 44.6 24.5
– COT Index Reading (3 Year Range): Bullish Bearish Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -15.6 19.6 -16.7

 


Ultra 10-Year Notes:

Ultra 10-Year Notes Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 22.4 68.0 8.3
– Percent of Open Interest Shorts: 8.0 72.3 18.4
– Net Position: 182,235 -53,882 -128,353
– Gross Longs: 284,102 863,870 104,869
– Gross Shorts: 101,867 917,752 233,222
– Long to Short Ratio: 2.8 to 1 0.9 to 1 0.4 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 97.1 22.5 0.0
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 19.4 -9.2 -26.7

 


US Treasury Bonds:

US Treasury Bonds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 9.8 76.5 12.2
– Percent of Open Interest Shorts: 25.3 57.6 15.6
– Net Position: -190,334 232,454 -42,120
– Gross Longs: 120,484 939,647 149,680
– Gross Shorts: 310,818 707,193 191,800
– Long to Short Ratio: 0.4 to 1 1.3 to 1 0.8 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 20.3 94.2 22.0
– COT Index Reading (3 Year Range): Bearish Bullish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 2.5 6.0 -21.1

 


Ultra US Treasury Bonds:

Ultra US Treasury Bonds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 5.7 80.9 11.7
– Percent of Open Interest Shorts: 28.1 57.1 13.2
– Net Position: -255,460 272,678 -17,218
– Gross Longs: 65,849 926,471 134,351
– Gross Shorts: 321,309 653,793 151,569
– Long to Short Ratio: 0.2 to 1 1.4 to 1 0.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 64.7 57.3 0.0
– COT Index Reading (3 Year Range): Bullish Bullish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -11.6 18.1 -7.8

 


3-Month Eurodollars:

3-Month Eurodollars Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 19.8 50.4 4.8
– Percent of Open Interest Shorts: 14.5 53.1 7.4
– Net Position: 606,399 -308,521 -297,878
– Gross Longs: 2,268,350 5,771,615 545,063
– Gross Shorts: 1,661,951 6,080,136 842,941
– Long to Short Ratio: 1.4 to 1 0.9 to 1 0.6 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 70.6 28.2 64.6
– COT Index Reading (3 Year Range): Bullish Bearish Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -0.8 2.4 -15.3

 


Article By CountingPips.comReceive our weekly COT Reports by Email

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators).

Find CFTC criteria here: (http://www.cftc.gov/MarketReports/CommitmentsofTraders/ExplanatoryNotes/index.htm).

Sovereign bond selloff resumes after a short break

By Hussein Sayed Chief Market Strategist (Gulf & MENA), ForexTime

Asian equity markets suffered hefty losses following yesterday’s declines in Wall Street as bond yields resumed their rally. Japan’s Nikkei 225 and Hong Kong’s HSI dropped nearly 3% with the rest of the Asian stock indices all in the red, while US stock futures show no signs of recovery. All three major indices are indicating a negative start led by Tech stocks. In currencies, the dollar ticked higher against its major peers with USDJPY climbing to a seven-month high above 107.

With US inflation expectations over the next five years reaching a 13-year high and long term-borrowing costs on the rise, central banks face tough challenges comforting investors. Financial conditions are tightening despite the monetary policy being loose and policymakers clearly signaling no intention of raising interest rates anytime soon. The Federal Reserve may need to step up their game by targeting purchases of long-dated bonds to prevent yields from going higher, but so far there are no signs of them implementing this strategy. All eyes will be on Fed Chair Jerome Powell today for any signals of possible changes to monetary policy such as yield curve control.

The sovereign bond selloff is not confined to the US. UK 10-year gilts rose more than 10 basis points to 0.8% after Finance Minister Rishi Sunak announced the country’s 2021 budget. And despite the Eurozone being well behind in vaccinating their population and in terms of their economic recovery, bonds also sold off in Germany, France, Italy and Spain. That tells us it is not just economic fundamentals impacting bond prices, but there seems to be a domino effect caused by rising yields in the US.

Energy and Financials were the only sectors ending in the green on the S&P 500 yesterday. The shift to those value sectors will likely resume along with industrials and basic materials after the passing of Biden’s $1.9 trillion pandemic relief bill.

Oil is another asset class firmly on the radar of many traders. Prices rose for a second straight session after Brent crude tested a two-week low of $62.38 on Tuesday. While the record drop in US gasoline inventories lent prices some support, its today’s OPEC+ meeting that will dictate direction over the short-term. If Saudi Arabia chooses not to continue with its unilateral one million b/d output cut and the group increases production by another 500k b/d, we will end up with 1.5 million b/d additional output. That seems to be the base case scenario for many traders.

Given that recent price moves have been driven more by speculative trading than market fundamentals, any disappointment may lead to a sharp selloff. For prices to remain near their pre-pandemic levels or higher, we need to see a positive surprise. That could occur by keeping the group’s output unchanged or if we get a gradual rollback of Saudi Arabia’s unilateral cuts. It is hard to predict the next move of the cartel due to the various opinions within the group’s members, and that is what makes it an exciting event to watch.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

COT Bonds Futures Charts: 10-Year Treasury Notes, Eurodollar, Fed Funds

By CountingPips.comReceive our weekly COT Reports by Email

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday February 23 2021 and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.


30-Day Federal Funds:

30-Day Federal Funds

30-Day Federal Funds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 8.2 72.4 1.9
– Percent of Open Interest Shorts: 17.6 62.9 2.0
– Net Position: -111,478 112,803 -1,325
– Gross Longs: 98,122 863,148 22,222
– Gross Shorts: 209,600 750,345 23,547
– Long to Short Ratio: 0.5 to 1 1.2 to 1 0.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 15.5 83.7 68.7
– COT Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -19.3 17.9 13.1

 


2-Year Treasury Note:

2-Year Treasury Note

2-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 26.2 63.6 6.1
– Percent of Open Interest Shorts: 27.9 64.8 3.2
– Net Position: -39,871 -29,660 69,531
– Gross Longs: 623,688 1,512,141 145,752
– Gross Shorts: 663,559 1,541,801 76,221
– Long to Short Ratio: 0.9 to 1 1.0 to 1 1.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 78.6 11.7 71.6
– COT Index Reading (3 Year Range): Bullish Bearish-Extreme Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 52.3 -48.2 -0.4

 


5-Year Treasury Note:

5-Year Treasury Note

5-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 22.0 61.9 8.4
– Percent of Open Interest Shorts: 19.5 62.6 10.2
– Net Position: 95,406 -29,241 -66,165
– Gross Longs: 833,986 2,343,372 318,667
– Gross Shorts: 738,580 2,372,613 384,832
– Long to Short Ratio: 1.1 to 1 1.0 to 1 0.8 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 100.0 7.2 49.4
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 44.9 -34.5 -16.0

 


10-Year Treasury Note:

10-Year Treasury Note

10-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 15.9 64.1 10.2
– Percent of Open Interest Shorts: 15.8 59.6 14.7
– Net Position: 2,789 181,377 -184,166
– Gross Longs: 642,543 2,594,445 411,118
– Gross Shorts: 639,754 2,413,068 595,284
– Long to Short Ratio: 1.0 to 1 1.1 to 1 0.7 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 83.5 35.3 24.0
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 5.8 1.8 -19.8

 


Ultra 10-Year Notes:

Ultra 10-Year Notes

Ultra 10-Year Notes Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 19.0 69.0 9.9
– Percent of Open Interest Shorts: 6.2 72.4 19.2
– Net Position: 173,188 -46,157 -127,031
– Gross Longs: 258,297 940,572 135,254
– Gross Shorts: 85,109 986,729 262,285
– Long to Short Ratio: 3.0 to 1 1.0 to 1 0.5 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 94.1 24.9 0.0
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 14.4 -2.4 -34.1

 


US Treasury Bonds:

US Treasury Bonds

US Treasury Bonds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 10.4 73.2 13.8
– Percent of Open Interest Shorts: 22.9 58.1 16.3
– Net Position: -156,309 188,155 -31,846
– Gross Longs: 129,775 914,249 172,342
– Gross Shorts: 286,084 726,094 204,188
– Long to Short Ratio: 0.5 to 1 1.3 to 1 0.8 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 30.2 80.1 29.9
– COT Index Reading (3 Year Range): Bearish Bullish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 11.7 -12.0 -1.9

 


Ultra US Treasury Bonds:

Ultra US Treasury Bonds

Ultra US Treasury Bonds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 7.6 76.8 12.6
– Percent of Open Interest Shorts: 25.7 57.6 13.8
– Net Position: -215,036 228,517 -13,481
– Gross Longs: 90,156 912,983 150,059
– Gross Shorts: 305,192 684,466 163,540
– Long to Short Ratio: 0.3 to 1 1.3 to 1 0.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 77.9 39.4 1.6
– COT Index Reading (3 Year Range): Bullish Bearish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 5.3 -4.1 -5.4

 


3-Month Eurodollars:

3-Month Eurodollars

3-Month Eurodollars Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 20.5 48.2 4.7
– Percent of Open Interest Shorts: 14.0 52.2 7.2
– Net Position: 752,498 -465,476 -287,022
– Gross Longs: 2,372,370 5,575,667 543,029
– Gross Shorts: 1,619,872 6,041,143 830,051
– Long to Short Ratio: 1.5 to 1 0.9 to 1 0.7 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 72.9 26.0 66.1
– COT Index Reading (3 Year Range): Bullish Bearish Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 1.7 0.1 -15.3

 


Article By CountingPips.comReceive our weekly COT Reports by Email

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators).

Find CFTC criteria here: (http://www.cftc.gov/MarketReports/CommitmentsofTraders/ExplanatoryNotes/index.htm).

Yields surge triggers market drama

By Han Tan Market Analyst, ForexTime

The surge in Treasury yields sent shockwaves across broader markets on Thursday, with 10-year yields briefly breaching the 1.60 mark to hit a new one-year high before moderating. At the time of writing, 10-year yields remain some 40 basis points higher on a month-to-date basis.

The steep ascent in yields is prompting investors to cast serious doubt over their exposure to equities, especially for tech stocks. The Nasdaq Composite index has seen its February gains whittled down to 0.37%, with US equity futures pointing to further declines at the Friday open.

Asian benchmark indices are ending the month on a downer, while the rising yields are giving reason for the dollar index (DXY) to keep its head above the 90 psychological level for the time being. The VIX index, also known as Wall Street’s fear gauge also shot above the 30 mark shortly before the US session ended.

Markets paying little heed to the Fed’s narrative

Investors clearly have a hard time buying into the Fed speak insisting that its too early to talk about tapering. Despite repeated attempts this week by Fed Chair Jerome Powell and other Fed presidents to reframe the narrative, saying that the rising yields are indicative of a rosier economic outlook, investors are instead interpreting the economic data through the US monetary policy lens.

While cognizant of the Fed’s desire to avoid the same policy missteps following the global financial crisis over a decade ago, markets however are of the opinion that improving US economic conditions will cajole the central bank into tightening their policy settings sooner than expected. Fed funds futures are already pointing to an interest rate hike that’s brought forward to end-2022.

The better-than-expected economic prints released this week, including the weekly initial jobless claims, January durable goods orders, and February consumer confidence, are only adding fuel to expectations that the Fed will have to bring its tapering plans forward, despite policymakers’ insistence otherwise. And with President Joe Biden’s $1.9 trillion fiscal stimulus programme still in the pipeline, investors are ramping up the chances of an overheating US economy that’s accompanied by the desired inflation overshoot, which in turn shortens the runway till the Fed’s eventual pullback.

With such a debate raging in the markets, we can expect to see more volatile days ahead until markets can reach a greater consensus and a firmer understanding over the Fed’s next policy steps, which should in turn offer a new equilibrium for Treasury yields.

Gold set to post second straight monthly decline

Spot gold is on course to register its 6th monthly loss from the past seven, with rising Treasury yields dealing a blow to the non-yielding precious metal. Bullions year-to-date losses stand at 6.7% at the time of writing.

Despite the threat of rising inflation, investors are clearly willing to ditch gold in favour of other assets that can better ride on the economic recovery’s coattails, as well as the subsequent inflation overshoot. Gold ETFs have shed their holdings by more than 2 million ounces so far this year.

Gold bulls will have all to do in attempting to break the precious metal out of its current downtrend, barring any Fed intervention in quelling the yields surge.

 

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

COT Bonds Futures Charts: 10-Year Treasury Notes, Eurodollar, Fed Funds

By CountingPips.comReceive our weekly COT Reports by Email

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday February 16 2021 and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.


30-Day Federal Funds:

Fed Funds Futures Chart

30-Day Federal Funds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 11.8 69.6 1.6
– Percent of Open Interest Shorts: 18.8 62.3 1.9
– Net Position: -80,391 83,820 -3,429
– Gross Longs: 136,008 799,270 18,550
– Gross Shorts: 216,399 715,450 21,979
– Long to Short Ratio: 0.6 to 1 1.1 to 1 0.8 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 19.9 79.7 64.9
– COT Index Reading (3 Year Range): Bearish-Extreme Bullish Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -17.9 16.8 9.8

 


2-Year Treasury Note:

2-year bond Futures Chart

2-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 22.1 67.6 7.1
– Percent of Open Interest Shorts: 28.2 64.0 4.6
– Net Position: -142,489 85,740 56,749
– Gross Longs: 518,150 1,584,929 165,585
– Gross Shorts: 660,639 1,499,189 108,836
– Long to Short Ratio: 0.8 to 1 1.1 to 1 1.5 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 57.2 33.9 64.8
– COT Index Reading (3 Year Range): Bullish Bearish Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 8.6 -4.8 -8.7

 


5-Year Treasury Note:

5-year bond Futures Chart

5-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 22.5 66.6 8.3
– Percent of Open Interest Shorts: 22.7 65.4 9.4
– Net Position: -6,152 43,260 -37,108
– Gross Longs: 793,241 2,345,137 292,707
– Gross Shorts: 799,393 2,301,877 329,815
– Long to Short Ratio: 1.0 to 1 1.0 to 1 0.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 93.7 13.6 60.2
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 29.8 -20.1 -17.3

 


10-Year Treasury Note:

10-year Futures Chart

10-Year Treasury Note Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 17.9 69.3 9.5
– Percent of Open Interest Shorts: 15.0 67.5 14.2
– Net Position: 103,413 64,055 -167,468
– Gross Longs: 645,250 2,498,104 343,023
– Gross Shorts: 541,837 2,434,049 510,491
– Long to Short Ratio: 1.2 to 1 1.0 to 1 0.7 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 94.6 23.9 31.9
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 8.3 4.8 -32.9

 


Ultra 10-Year Notes:

ultra 10-year bonds Futures Chart

Ultra 10-Year Notes Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 19.1 69.5 9.0
– Percent of Open Interest Shorts: 6.6 72.9 18.1
– Net Position: 157,117 -43,013 -114,104
– Gross Longs: 239,996 872,832 113,410
– Gross Shorts: 82,879 915,845 227,514
– Long to Short Ratio: 2.9 to 1 1.0 to 1 0.5 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 88.7 25.8 4.6
– COT Index Reading (3 Year Range): Bullish-Extreme Bearish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 8.8 -3.1 -17.3

 


US Treasury Bonds:

long us bond Futures Chart

US Treasury Bonds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 8.4 75.9 12.7
– Percent of Open Interest Shorts: 24.2 58.0 14.8
– Net Position: -191,002 215,916 -24,914
– Gross Longs: 101,705 916,697 153,685
– Gross Shorts: 292,707 700,781 178,599
– Long to Short Ratio: 0.3 to 1 1.3 to 1 0.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 20.1 88.9 35.2
– COT Index Reading (3 Year Range): Bearish Bullish-Extreme Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -1.0 6.4 -12.8

 


Ultra US Treasury Bonds:

ultra us treasury Futures Chart

Ultra US Treasury Bonds Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 8.1 77.7 12.9
– Percent of Open Interest Shorts: 28.5 56.7 13.6
– Net Position: -229,297 237,111 -7,814
– Gross Longs: 91,785 875,369 144,842
– Gross Shorts: 321,082 638,258 152,656
– Long to Short Ratio: 0.3 to 1 1.4 to 1 0.9 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 73.3 44.0 6.5
– COT Index Reading (3 Year Range): Bullish Bearish Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: 1.6 -4.9 6.5

 


3-Month Eurodollars:

eurodollars bonds Futures Chart

3-Month Eurodollars Statistics SPECULATORS COMMERCIALS SMALL TRADERS
– Percent of Open Interest Longs: 18.3 48.9 5.2
– Percent of Open Interest Shorts: 13.4 51.7 7.3
– Net Position: 563,386 -317,754 -245,632
– Gross Longs: 2,087,589 5,566,009 586,384
– Gross Shorts: 1,524,203 5,883,763 832,016
– Long to Short Ratio: 1.4 to 1 0.9 to 1 0.7 to 1
NET POSITION TREND:
– COT Index Score (3 Year Range Pct): 70.0 28.0 71.3
– COT Index Reading (3 Year Range): Bullish Bearish Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index: -2.9 4.8 -18.7

 


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Are higher bond yields spoiling the risk rally?

By Hussein Sayed Chief Market Strategist (Gulf & MENA), ForexTime

Astonishingly upbeat economic data out of the US failed to send equity benchmarks higher on Wednesday. Consumers across the States decided not to keep stimulus checks in their bank accounts but rather spend them on electronics, appliances, furniture and online. Almost every major category in the retail sales report showed a significant increase. The 5.3% growth in January is the largest monthly rise since June, when the US began recovering from strict lockdowns.

Looking at the trend in coronavirus cases and vaccine distribution, we should expect the economic recovery to gather steam over the coming months. Add to this a big, bold fiscal stimulus plan that should speed up the recovery.

According to the FOMC minutes of last month’s monetary policy meeting released overnight, officials are not expected to scale down their asset purchases anytime soon. Achieving the goal of maximum employment will take some time and policymakers don’t seem to be in a rush to shift away from their current crisis mode. However, inflation is the trickier part in setting policy. Producer prices surged in January, rising 1.3% from December and this marked the largest monthly gain in more than a decade. So far, the Fed do not seem that worried about rising prices and they see such moves as temporary and not having a lasting effect.

The combination of robust economic recovery expectations backed by loose monetary policies and supportive fiscal measures should point to further gains in risk assets. But one factor seems to be spoiling the party, and that is rising bond yields. Those on the US 10-year Treasury reached a high of 1.33% on Wednesday before paring some of its gains later in the afternoon and is sitting at 1.28% at the time of writing. The longer term 30-year yield has seen a similar spike over recent weeks, touching 2.11% yesterday. The recent rally seen in yields reflects mainly two things. One is we are finally beating the virus and hence we are headed for strong economic activity. The second part which worries many investors is that inflation may return at a faster pace than previously anticipated.

Going forward, investors need to keep a close eye on how long term yields behave from here.

A steady slow increase may not necessarily disrupt the uptrend in equities but will likely force rotation from highly priced stocks, typically in the tech sector, to more reasonably priced cyclical ones. But another sharp spike in bond yields, in which the 10-year approaches 1.75% in a short time frame could pose a big risk to the bullish trend in the overall equity market.

While the greenback is also benefiting from rising bond yields, the magnitude of the dollar’s rise has been limited so far, with the dollar index, DXY, strengthening 0.7% over the past two days. The inverse correlation between risk-on and the dollar will be tested over the coming weeks, especially if yield differentials continue to widen further between the US and the rest of the developed economies.

 

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


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Death Cross Forming in Gold Amid Rising Bond Yields

Gold Daily Chart

Gold prices extended their losses in early trading on Wednesday, pressured by rising bond yields and a firmer US dollar. On Tuesday, the US 10-year Treasury yield reached a level not seen since February 2020, while the US dollar index bounced back from a three-week low.

The rise in bond interest rates has been spurred by the optimistic outlook in the market, amid positive news on COVID-19 vaccine rollouts and the $1.9 trillion US stimulus package. Rising bond yields make non-yielding assets such as gold a less appealing investment.

The mandatory Securities and Exchange Commission’s (SEC) 13F filing of BlackRock, the world’s largest asset manager, revealed that it is exiting gold and buying silver. The filing showed that in the fourth quarter of 2020 BlackRock sold 2.7 million SPDR Gold Shares (GLD) and bought 1.18 million shares of iShares Silver Trust (SLV).

Meanwhile, Bitcoin, the asset increasingly touted as ‘digital gold’, crossed the mega psychological level of $50,000 in Tuesday trading. The latest surge came as large companies including Tesla, Mastercard and BNY Mellon showed support for cryptocurrencies.

Peter Schiff, notable gold bull and CEO of Euro Pacific Capital tweeted: “Now that #Bitcoin has hit $50,000 I must admit that a move up to $100,000 can’t be ruled out. However a move down to zero can’t be ruled out either. While a temporary move up to $100K is possible, a permanent move down to zero is inevitable. If you don’t want to gamble buy #gold.”

Holger Zschäpitz, Senior Editor at the Economic and Financial desk of the German daily Die Welt pointed out the stark difference in the two assets, tweeting: “#Bitcoin is eating Gold in one chart! Gold/Bitcoin ratio hit a fresh All-Time low.”

Looking at the gold daily chart we can see that a bearish ‘death cross’ pattern (50 period moving average crossing below the 200 period moving average) is forming and that prices are falling for a fifth consecutive session. The next key level of potential support lies at the prior low of $1,763. Markets now look to the US retail sales report and the minutes of the Federal Reserve’s January monetary policy meeting.

By Dan Blystone, TradersLog.com

Treasury Yields suggest a top within the next 6 months

By TheTechnicalTraders 

– Historically, whenever the Treasury Yields fall below zero, then recover back above zero, the US/Global markets reach some peak in price levels within 3 to 8+ months.  My research team and I believe the actions of the global markets may be setting up for a future peak in price levels sometime in next 6 months. We believe this will start when the Treasury Yields cross above the “Breakdown Threshold”.

expect A Continued Rally As Long As Yields Stay Below Certain Levels

In 1998, a very brief drop below zero in yields prompted a minor pullback in the markets before the bigger top setup in 2000.  This pullback in price aligned with what we are calling the “Breakdown Threshold” level on Yields near 1.20.  After the Yields crossed this Threshold, briefly, in 1999, they fell back below this level and the US stock market continued to rally toward an ultimate peak in 2000.

In late 2000, Yields collapsed well below the zero levels and recovered back above zero in early 2001.  Just 3+ months later, Yields had rallied above the Breakdown Threshold level (1.2) and the US stock markets had already begun to breakdown as well.  This instance, the 2000-01 peak, took place after an Appreciation cycle phase prompted an Excess Phase Rally (the DOT COM bubble). The “Rollover Top” that took place near this top may be similar to what we see happen in 2021 if our research is correct.

In late 2006, Yields again collapsed well below the zero level and recovered back above zero near mid 2007.  This time, Yields stalled a bit in their advance higher and clearly broke above the Breakdown Threshold in early 2008.  By this time, the US markets had already moved into a sideways/rollover topping formation and began to decline sharply after the Breakdown Threshold was breached.

Be sure to sign up for our free market trend analysis and signals now so you don’t miss our next special report!

What we find interesting about this research is that as long as the Treasury Yields fail to rally above the 1.2 Breakdown Threshold, the market dynamics appear to support a “melt-up” type of trend.  Even though traders should understand the risks are starting to become excessive based on this type of pattern, the markets continue to push higher as long a Yield levels stay below the Breakdown Threshold after reaching the Setup Threshold.  It is our belief that the Setup Threshold must be breached (to the downside) for this topping pattern to really anchor into place.

Looking at the chart below, in 1996 (highlighted in BLUE) the Setup Threshold was breached, but the Zero level was not breached by Yields.  When Yields rallied back above the Breakdown Threshold, a minor sideways price correction took place (briefly).  As Yields fell back below the Breakdown Threshold (while never breaching the Setup Threshold), the stock market rallied strongly – resulting in a 90% price rally before the Yields broke the zero level in 1998.

Source: Stockcharts.com

Currently, the Yields level has broken below the zero level and the Setup Threshold, thus there is a high probability that any advance above the Breakdown Threshold will prompt a moderately strong price correction in the US stock markets.  If Yields continue to rally higher, we can expect the broader market to move down, possibly starting a new bearish price trend.

Depending on what Treasury yields do from this point forward, we could expect a number of different outcomes.  We’ve attempted to highlight various outcomes on the chart below in different colors.

  • RED: If Treasury Yields rally above the Breakdown Threshold and continue to push higher, then there is a very strong potential that the US/Global markets will enter a deep correction phase and/or bearish trending cycle.
  • BLUE: If Treasury Yields rally above the Breakdown Threshold, then stall and fall back below this level fairly quickly, there is a strong potential that the US stock markets will stall and briefly contract before resuming a “melt-up/bullish trend”.  This “fluttering” near the Breakdown level may be indicative of uncertainty in the markets or global central banks attempting to push capital resources into the markets to push the economy into a recovery mode.
  • MAGENTA: if Treasury Yields fail to breach the Breakdown Threshold, there is a very strong likelihood that the US stock markets will continue to trend higher (in an Excess Phase mode) prompting a series of new higher closes over time.  Our researchers believe we are currently within an Excess Phase topping setup.  So, if Yields fail to breach the Breakdown Threshold, it is very likely that the Excess Phase rally will continue (which would be very similar to 1996~1998 in terms of potential price appreciation).
Source : StockCharts.com

What this means for traders is that we could see very big, broad market sector moves over the next 12 to 24+ months.  These charts suggest we will either see a continued price rally or some type of moderate price breakdown in the near future depending on how Treasury Yields react near the Breakdown Threshold.  2021 is going to be a very exciting year for traders – big trends, big sector moves, and the potential for a very big shift in the global markets.  Now that you have this research, you can plan and prepare for the risks and trends that are setting up right now.

Don’t miss the opportunities in the broad market sectors over the next 6+ months, which will be an incredible year for traders of the BAN strategy.  You can sign up now for my FREE webinar that teaches you how to find, enter, and profit from only those sectors that have the most strength and momentum. As some sectors fail, others will begin to trend higher.  Learn how BAN Trader Pro can help you spot the best trade setups; staying ahead of sector trends is going to be key to success in these markets.

For those who believe in the power of trading on relative strength, market cycles, and momentum but don’t have the time to do the research every day then my BAN Trader Pro newsletter service does all the work for you. In addition to trade alerts that can be entered into at the end of the day or the following morning, subscribers also receive a 7-10 minute video every morning that walks you through the charts of all the major asset classes. For traders that want more trading than our 20-25 alerts per year, we provide our BAN Trader Pro subscribers with our BAN Hotlist of ETFs that is updated each day. We issued a new trade alert for our subscribers today and all four trades are well on their way to great returns!

Happy trading!

Chris Vermeulen
Chief Market Strategist

 TheTechnicalTraders.com

Treasury yields continue to grow steadily following commodity prices and positive US data

by JustForex

10-year bonds yield continues to rise and surpassed the 1.10% mark yesterday. Investors are positive about the expansion of stimulus measures for the economy after the Congressional elections. The Democratic victory is expected to increase welfare benefits from $600 to $2,000.

The dollar index rose following the bonds. Positive statistics this week cheered the bulls. According to ISM, the manufacturing sector showed positive dynamics at first. Now the service sector has distinguished itself with high indicators. According to the Institute for Supply Management, the service index rose over the month to 57.2 from 55.9 in November. The December marker exceeded all economists’ forecasts. Values above 50 indicate expansion.

The acceleration in the growth of companies that contribute to the economy the most is surprising considering the rise in coronavirus infections and tightening restrictions for businesses in some states.

In December, fourteen service sectors showed growth, primarily due to management companies and support services, wholesale and retail sellers, and medical services. There was a contraction in the hotel and catering sectors. Negative indicators are also observed in the field of entertainment and leisure.

Index of employment was the only weak link in the report. There was a contraction for the first time in four months. The index fell to 48.2. Shortly before the release of data on the US labor market, this is the only negative moment for the market confirming weak expectations. In the American session, one can probably expect high volatility in the stock, credit, and foreign exchange markets.

Currently, the stock market and the dollar index are demonstrating positive dynamics:

S&P 500 (F) 3,808.88 +13.38 (+0.35%)

Dow Jones 31,041.13 +211.73 (+0.69%)

DAX 14,122.95 +154.71 (+1.11%)

FTSE 100 6,873.35 +16.39 (+0.24%)

USD Index 90.037 +0.246 (+0.27%)

Important events:
  • – Nonfarm Payrolls Сhange (Dec) at 16:30 (GMT+2);
  • – Average Hourly Earnings (m/m) (Dec) at 16:30 (GMT+2);
  • – Unemployment rate (Dec) at 16:30 (GMT+2).

by JustForex

 

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Bond Market: “When Investors Should Worry”

The cost of insuring against default has been declining – what this may suggest 

By Elliott Wave International

You may recall hearing a lot about “credit default swaps” during the 2007-2009 financial crisis.

As a reminder, a CDS is similar to an insurance contract, providing a bond investor with protection against a default.

In the past several months, the cost of that protection has fallen dramatically.

The November Elliott Wave Financial Forecast, a monthly publication which provides analysis of major U.S. financial markets, showed this chart and said:

The Markit CDX North American Investment Grade Index comprises 125 equally weighted credit default swaps on investment grade debts. It shows the cost of insuring against default on high grade bonds issued by the most liquid companies. When the index is low, as it was in January 2018 and January and February 2020, the cost of insuring against default is low, because investors view the nonpayment of debt obligations as most improbable. Ironically, this is when investors should worry. Each time the stock market fell, the Markit index surged. The index has subsequently declined toward the lower end of its historic range, indicating complacency yet again.

This complacency toward default risk is occurring just as corporate bankruptcy filings are surging. As a matter of fact, the third quarter of 2020 was the worst quarter on record for U.S. bankruptcy filings.

Take a look at this Oct. 26 news item from Bloomberg:

Bond Defaults Deliver 99% Losses in New Era of U.S. Bankruptcies

Desperate to generate higher returns during a decade of rock-bottom rates, money managers bargained away legal protections, accepted ever-widening loopholes, and turned a blind eye to questionable earning projections. Corporations took full advantage and gorged on astronomical amounts of debt that many now cannot repay or refinance.

Now, keep in mind that all these bankruptcy proceedings – where many creditors are walking away with just pennies – are occurring during a time of historically low interest rates.

Imagine what will happen should rates begin to rise. It will become increasingly difficult for corporations to borrow at low rates AND service the huge amount of outstanding debt.

Let’s return to the November Elliott Wave Financial Forecast:

Increasing bankruptcies, debt restructurings and defaults are deflationary.

Are you prepared for a historic deflation?

Learn what you need to know to keep you and your family financially safe by reading the free report, “What You Need to Know Now About Protecting Yourself from Deflation.” Here’s a quote:

Many investment advisors speak as if making money by investing is easy. It’s not. What’s easy is losing money, which is exactly what most investors do. They might make money for a while, but they lose eventually. Just keeping what you have over a lifetime of investing can be an achievement. …

Protecting your liquid wealth against a deflationary crash and depression is pretty easy once you know what to do.

Find out how to protect your wealth during a deflationary crash.

Get started by following this link: ““What You Need to Know Now About Protecting Yourself from Deflation.” – free access.

This article was syndicated by Elliott Wave International and was originally published under the headline Bond Market: “When Investors Should Worry”. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.