Early Friday, Sept. 30, all Treasury products (30s, 10’s, 5s and 2s) either tested or posted their respective weekly highs and plunged throughout the session to finish the week at the lower end of their respective weekly ranges.
On Friday, Aug. 19, the 30-Year Treasury Bond finished the week going out near its weekly low as the market rejected my call for a recovery; The 10-year Treasury Note finished the week re-testing its weekly low and my minimum lower weekly boundary projection at 131-26/24.
The Bank of Japan says there is no possibility of helicopter money, and by a strict definition they are correct. But as the government plans to issue more 40-year bonds, it is looking more and more like some monetization of debt is underway. The BOJ says as long as it buys Japanese government bonds (JGB) from the market, it is not directly underwriting bonds to fund government spending.
Finding trades, opportunities to make money, is what technical analysis is all about. Therefore, it is often very beneficial to combine long- and short-term analysis to improve timing, and therefore gain better control of the “risk of ruin” when initializing trades. The 30-Year Treasury Bond monthly offers a good example of this technique.
Japan's Ministry of Finance is negotiating with the country's major banks to lend to the government at a zero interest rate in auctions beginning in October or November, a government official familiar with the procedure said today.