Thursday, November 20, 2008

Major Move In Long Bond Treasury Market

The 30-year U.S. Treasury bond climbed 5 points during the regular session today and is up another 4 points in after hours trading.

The big question is who is the aggressive buyer? Is it a short seller caught in a squeeze? Is there someone who actually believes that inflation over the next 30 years will not climb above 3.44%? Could it be the Fed?

Dramatic moves like this usually have a story to them. And more often then not they reveal themselves over time. But with a major move like this, guaranteed there are some shorts bleeding tonight.

For anyone with patience and staying power, this has to be an ideal time to short the bonds. There is no way I see these rates at these levels long term.

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