The Market Word - 10 Year Treasury Notes
The Treasuries had reached their highs in September as many of the commodity markets were under pressure. The 2-3 years of instability in the Euro Zone seemed destined for contagion fears and potential defaults. Traders had flocked into the safe-haven Treasuries and US Dollar. The Euro Zone summit of this last week consisted of two meetings in Brussels to reach an accord on the major issues plaguing the region. The summit had appeased the anxieties of investors by agreeing on a recapitalization of European Banks and leveraging the European Financial Stability Facility. The fund initially had $440 billion euros while $1 trillion euros were necessary to control the massive debt crisis. The write-downs for the bondholders of Greece are still in the works. Today, was the game changer with allocations flowing back into the risk assets. The safe-haven products became out of vogue as the confidence in the marketplace returned. US Gross Domestic Product was up today at a 2.5 % rate in the third quarter. This figure must grow in order to get ahead of the jobless rate. Today, the US Initial Jobless Claims were down by 2,000 to 402,000, a bit better, but still only showing moderate growth. The moderate growth has not changed, but perhaps the expectations of traders have diminished. As the confidence has returned to the marketplace and the allocations favor the risk assets, the Treasuries may slide from weakness.
Technically, the December 10 Year T-Notes are in sell mode on the Daily Chart according to the Wilder's Parabolic SAR!
Sample Trade Opportunity!
Sell December T-Notes (ZNZ11) at $128^00. If filled, buy ZNZ11 at $129^00 Stop or buy ZNZ11 at $123^00 Limit (Target). The risk on this trade would be $1,000.00 plus fees and commissions. The profit potential is $5,000.00 less fees and commissions. The expiration is November 30th.