For those keeping an eye on the Bund, we note some bearish price action that may result in still lower levels. There was a bearish reverse over the three session period ending Dec. 22 that appears as if it will be confirmed with a lower settle today. This price action is consistent with that seen back in late October when the contract fell 4 points.
Today, directionality may have been decided with the bund falling over a point from yesterday’s settlement. A stronger sense that major players are coming together to examine the Greece situation is bring calm and could be putting some pressure on rates.