ECONOMIC DATA for Jan. 22, 2009:
8:30 AM US Housing Starts (615,000). US weekly jobless claims (610,000).
11:00 AM EIA Oil Inventory numbers (delayed from Wed)
TREASURIES CONTINUE DOWNWARD TREND AS EQUITIES BOUNCE OFF PERCEIVED BOTTOM, CONTINUED SUPPLY CONCERNS.
U.S. Treasuries continued to lose ground today as equities appeared to hit support & bounce off strongly after better than expected earnings from IBM, Bank of New York, and Apple managed to alleviate some of the concerns regarding global economic conditions and earnings. The market for government debt also lost some of its attractiveness as the U.S. dollar weakened from its recent highs, diminishing returns for current and future holders of the debt and the U.S. housing market index report came in weaker than expected.
Reports that show a lack of coordination between lower Treasury yields/mortgage rates and pickups in real estate sales continue to spur investors to reevaluate Government debt holdings, placing priority on the low yield of the instruments, thereby losing some of their appeal in the wake of higher yielding instruments that will be better suited for longer term investments.
Technically, 30-year bond futures continue in a downward trend, breaking through a key support level of 131.16. This break has opened up the market to test the lower end of the 130.00 level. Look for some support near 130.12. If that level holds, a bounce back to resistance of 132.00 is possible. If it breaks, it could be a setup to test the key support of 128.16.
US DEBT FUTURES
OPEN
HIGH
LOW
CLOSE
CHANGE
US H9 (US 30 YRS)
134.055
134.070
130.310
131.260
-3.085/32nds
TY H9 (US 10 YRS)
125.310
125.310
124.185
124.235
-1.165/32nds
Prepared by Rich Roscelli & Paul Brittain.
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.
