The market is on hold for Friday’s non-farm payrolls numbers despite getting a glimpse of the data with today’s ADP estimates of the government figures. According to ADP, the private sector lost 23,000 jobs last month despite expectations for an increase of 40,000. The news took some of the edge off of the optimism for the employment report and, accordingly, sparked a moderate bid in Treasuries.
In other economic news, the Chicago PMI was a large miss. The number was reported to be 58.8, much lower than the previous 62.6 and the consensus forecast of 61.
With the day’s news decisively bullish, it was disappointing to see the lack of upward momentum on the rally in the 30-year. Yet, the 10-year note did manage to trade at our initial upside target. It will be up to the long bond to lead the market higher, if that is in fact the chosen direction.
We see resistance in the 30-year bond at 116’26 but don’t trust the rally beyond this point. At or near such pricing we turn neutral and recommend exiting any bullish positions. Similarly, we see resistance in the note at about 116’24 and feel like the rally might get heavy in this area.
Our clients were reommended to exit the short June 110 puts a 11this afternoon to lock in a quick profit.
* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track ‘n Trade, Gecko software.
**Seasonality is already be factored into current prices, any references to such does not indicate future market action.
Treasury Bond and Note Option Trading Recommendations
**There is unlimited risk in naked option selling.
March 25 – Clients were advised to sell the June 110 puts in the 30 year bond for 24/25 ticks.
Treasury Bond and Note Futures Trading Recommendations
**There is unlimited risk in trading futures.
Flat
Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701
http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.com
*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.
There is substantial risk of loss in trading futures and options.
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. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
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