What a big week for the bond markets, as we have sold of close to 400 ticks in the Bund, moved up big in the 2s 10s spreads, and have seen big moves up in the Euribor spreads as well as other STIR spreads. Is the market getting a bit ahead of it self? In my opinion yes, but that doesn't change what's happening right now, and my strategy to keep shorting into the rising spreads is proving to be alot of hard work.But this is generally the correct strategy so will continue doing it and scratching if need be.
Going forward, its likely that we are going to keep going up in stocks, as there doesn't seem much in its way, and bonds are likely to stay lower for now, with yields jumping way above 2%, as long as data keeps coming in strong.
Below is some video analysis of the weeks moves:
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ReplyDeleteFirst of all, great blog, happy to have found it. I trade the STIRS and the last week has been very tough, quite unidirectional. I agree that the market is ahead of itself but hey we gotta trade what the market dictates. I think we're bound to see strong macro numbers, although I'd love to short the Euribor curve, I think it's good to be as carefull as possible. hopefully we'll find a few half tick range in the 3month spreads shortly...
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