NFP beat helps rally Equities

So it is back to business as usual as the Equities rallied strongly friday afternoon after a bit of a mixed week. Euro Indices came of quite strong with the Dax pushing 9200, FTSE 100 testing 6400 and the EuroStoxx testing 3100. The US indices have come off relatively less, but now are in mid range territory from high to recent low. I feel like there is a bit more resistance then usual as the markets are likely to consolidate, however the plunge in the VIX on friday might suggest a bit more upside to come.
Euro Indices are likely to remain under more pressure as data coming out has not been good and this mornings German Factory orders was a big miss. This coupled with the fact that the ECB is staying put with its current program suggests there is limited upside for now.
Not much to report on the Bond front, I'm using pullbacks in Short Sterling Spreads to go long, and the same with Eurodollar and Euribor Spreads.
I still remain long corn, hoping for a bit more of a move to get out, ideally above 3300.

Bonds Selling off as Dollar Strengthens

As Equities remain elevated, Bonds have taken the cue to sell off, as expectations of rate movements from the FED and BoE weigh.
Euro Bonds upside has been capped as it seems as though the ECB has used most of its bullets, with rate cuts and the announcement of QE in last Thursdays rate meeting.
I have generally tried to go long as much as I can in the Euribor Spreads as the floor for now has been set, and I went long into the initial fall in Spreads during the press conference to then realize profit as the floor seemed to be reached and the curve started to steepen slightly.
The following day we had weaker NFP as well, with the instant reaction in Equities going up, and Bonds going up also. This reaction proves the fact that the market doesn't care about fundamentals, its trading on the basis of cheaper money for longer, and this is the main driving force behind the one way move that we observe day after day.
Despite this worse number, the dollar has reached multi month highs, as expectations for FED tightening takes hold.
The market has been tough to trade as the trends have been strong, and despite, oversold conditions in some USD fx pairs, there doesn't seem to be any stabilization as of now.However I'm using options to play direction so as to not be whipsawed out but the frequent spikes that have been occurring.
Currently I'm long Corn, with a put bought as protection, and I'm short ES via a Call Spread financed by a out of the money put. A slight correction would be nice!
Looking forward we have US Retail Sales due, which could provide a bit of volatility,

30 Yr Strategy Update

Its been a quiet period since the end of August with two trades being triggered, one for a loss and one for a profit. Overall profit has been 2 ticks.

Spreads Fall as Bunds break 141

We have seen a sell off to the low of the ranges amongst the Euribor curve as the Bund first broke 141, and now is close to testing 142, as poor PMI numbers out of Europe as well as a poor ADP report out of the US lead to more safe haven buying. The Dow is trading at 4 year highs as is the Bund, which is being fuelled by cheap money. This in theory can continue until monetary stance changes, but it seems as though there is more likely to be further easing rather then tightening out of the US, which could fuel this rally more. After being off the past week, I have entered today long 3.5s/4s in Mar13 Jun13, Im looking to go long 4.5 in Jun13Sep13 too as this has been a solid level in this spread over the past few months. We have alot to look forward to this week, with the ECB rate meeting tomorrow as well as NFP on friday. Hopefully this will dish out some good volatility. Bunds now look well and truly bid, and it has broken the trend of retracing 100 ticks on the last move up in the mid 140s, which was inevitable eventually. With yields now at 1.6% we are reaching Japan yield levels, and so any good news I think can trigger 100 point sell of at least in this Bund, although i think we will stay above 140 in the near term.

Mad Euribor open

Who ever trades the short end would have seen today the mental open in the Euribor. We opened up and had 9k lots push the euribor down 10 prices in one swoop before it retraced. Ended up being a brutal day for me as I got filled all my longs and had to scramble to spread it all up at very bad prices. Ended up short over 60 lots and managed to reduce the loss to 1/2 tick which wasn't as bad considering I was down over 2 fat ticks at one point. The reason I presume is some repositioning or dumping of positions after the more upbeat FOMC statement yesterday.
As bad as it was maybe this could be the start of some volatility in the Short end. Volumes are way up almost 4 times more then usual at this time of the day.
We seem to have stabilised now but will be watching closely which way these spreads go when the US opens, I still favour shorts, because regardless of the more upbeat statement there is no sign of rate rises in the short to medium term so think these spreads will come back down again.
We may also get more ensuing volatility from the futures and options expiries this week so bear this in mind.

Summary of the Week- Euribor spreads retrace

In a week again dictated by what will be the take up in the Greek debt swap deal, and Greece something or another we seen the lofty spread prices of the previous weeks in the Euribor contracts come back down again. Last week I was shorting every spread especially in the back months, most notably Sep13-Dec13 and Dec13 Mar 14, as they kept going higher. In the later spread I was averaged in from 9s up to 10.5s, and didn't have the bottle to hold on to where I knew they were eventually going which was back down to the previous range. Its always easier as we all know to say something is going to happen, but with the pain of seeing the spread seem somewhat on a big break up to the upside, any sign of profit makes us want to get out after seeing the red. Also it took 7 days or so for it to come back down and being a day trader, it wasn't in my trading plan to hold it that long, although it does look like that's the new way forward in the current conditions.

Either way came out with small profit and now im looking to buy the spreads again. Disappointingly the ECB press conference yesterday didnt really provide much opportunity after the first small sell of in the Bors, but with Non farm payroll being released in just over an hour, an out of line number might spice things up a bit.
Im looking to go long 7/7.5s sep13 dec13, on the back month, in the front months looking an opportunity to go long 4.5/5s in Jun13/Sep13, short 6s-6.5.

Elsewhere with the Bund having rolled over, I am favouring longs back towards the 140 level in the jun12 contract, although a good Non Farm payroll could make me rethink that view.

Equities seem to be a buy still as returns elsewhere are very low, hence making it the best value out there.
Hopefully we have some movement of this NFP, good luck!

Central Banks Intervene

Fears of a deepening of Europe's debt crisis have prompted the world's leading central banks to pump US dollars into the financial system, in a co-ordinated action designed to boost market confidence.

The Bank of England joined the US Federal Reserve, the European Central Bank, the Swiss National Bank and the Bank of Japan on Thursday to announce that they would flood money markets with dollars over the coming months.

The move, on the third anniversary of the collapse of the US investment bank Lehman Brothers, sent shares soaring in banks heavily exposed to debt default by Greece and the other struggling members of the 17-nation eurozone.

Under the terms of the deal, banks will be able to bid for unlimited amounts of US dollars at fixed interest rates in three separate auctions. The first of these will be on 12 October.

Watch Below to see Market Reaction from the move

Non Farm Payrolls disappoint

No jobs created in August in the US that was the grim picture today that was setting the markets back as the Dow is off some 200 points. Below are some of the key points:
Key Highlights:

At 0, the NFP number is a plunge of 85K, from a downward revised July, which was previously at 117. This is the biggest drop since September 2010
The Household Survey saw an increase of 331K in the number of employed
Average hourly earnings for all employees on private nonfarm payrolls decreased by 3 cents, or 0.1 percent, to $23.09. This decline followed an 11-cent gain in July. This is the first time the avg hourly earnings have been negative MoM since January 2008
Underemployment, U-6, rose to 16.2%, from 16.1% in July
The labor force rose to 153.6 million in August.
Ironically the only good news in the report, was what many have been indicating is a negative for months: namely that the Labor Force Participation rate actually rose for the first time in months from the nearly 30 year low of 63.9% to 64.0%

Below is a video of the market moves made in the Bund, Ftse and S&P

Mad Market Volatility - Dax, Bund, Schatz, Ftse

Just put this video together around 30 minutes ago and since then we have come off massively again in stocks. We bounced off the near term support in the Dax at 5721 but after bouncing 50 ticks we dropped another 100, such is the volatility lately.
The video looks at some of the wide ranges we have had lately.