End of the month chop

Treasuries soared overnight to fresh highs but were unable to hold the gains. The 30-year bond futures traded comfortably near unchanged for the majority of the session to make the last day of the second quarter a non-event.
Payroll processor, ADP, reported that the U.S. economy gained only 13,000 jobs last month. This was a far cry from the previous 57,000 and the expected tick higher to 61,000.
The disappointment doesn’t bode well for the governments take on the employment numbers due Friday morning. However, today’s reaction to ADP might have paved the way for a Treasury unfriendly payroll report regardless of the numbers. This is because with expectations so low, it might take a complete employment disaster to simply keep Treasuries afloat.
Chicago PMI was reported near expectations and seemed to enable equities to hold firm and Treasuries to back off of early morning bids. The Index last month was calculated to be 59.1. Nonetheless, it is simply a speed bump in the way of Friday’s figures.
Treasuries still feel heavy up here, but the longer they hover the greater the odds of another run at new highs. We feel like a potential reversal could be on hold until post payrolls. We like the idea of fading a Friday morning rally, if it occurs.
Look for resistance just over 128 in the long bond and 123 in the note.
* 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 factored into current prices, any references to such does not indicate future market action.

june 29 bond 2010
june 29 note, 2010
Treasury Bond and Note Option Trading Recommendations
**There is unlimited risk in naked option selling.
Treasury Bond and Note Futures Trading Recommendations
**There is unlimited risk in trading futures.
Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
Local : 702-947-0701
*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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