13 September 2014

US Rates : Bearish

  • Weekly line charts of TYc1 and EDZ6. Clean view of price action stripped of intra-week noise.
  • TY (or ZN) : Fresh triangle breakout on downside, should be good for 4.5 big figures (from break point of appx 124-08), therefore targetting 119-24. Early days, plenty to go for. Short trade can be made with relatively tight stop on top given the freshness of the break.
  • ED (or GE) : Chart not as negative as TY. EDZ6 still trapped within range but current downleg should take us to 97-70. Probably need a change in current Fed stance (eg removal of "considerable period") to trigger the break, which I do expect.
  • Position : 1. Large short EDZ6 at 97-98 average   2. Medium sized short at 124-18 and 124-15. Probably wrong way round in weighting. Any increase in risk should be made in TY, unless 97-70 breaks too.

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