Possible T-Bond Rally May Present Selling Opportunity
CURRENT POSITIONS (AS OF 11/26/99) |
|||||
|---|---|---|---|---|---|
| Market | Date | Long/Short | Enter | Stop | size=2 color=000000>Target |
|
Dec. 99 T-Bonds |
Flat | ||||
|
Dec. 99 S&Ps
|
11/24/99 | Long | 1414 | 1395 | 1430 |
|
Dec. 99 Swiss franc
|
11/08/99 | Short | .6478 | .6590 | – |
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BondsÂ
December Treasury bonds [usz9>usz9] were down again Friday on a stronger-than-expected report showing personal income growth grew at a 1.3%
pace in October. Wages were the biggest point of interest within the report,
growing 0.6%. This data was further evidence of strength in the economy.
Further, a very weak European bond market also contributed to the weak tone
Friday. We are bearish here but do not want to establish a position at these levels. There is a good probability that we will see a rally from here, but that will be a selling opportunity.Â
Currencies
The December Swiss franc [sfz9>sfz9] continues to trend lower as the growth disparity between Europe and America continues. European central bank officials have given no signs that they are willing to step in and support the
euro. We are staying with our short positions as we wait for this scenario to play out.
| “The weaker bond market is going to start having a bearish effect on stocks.” |
Stocks
December S&Ps [spz9>spz9] had a weak close after just missing our profit target. The weaker bond market is going to start having a bearish
effect on the market. We are exiting our position on Sunday night on the Globex open as the weak close
Friday has made our longs look less appealing. Stay tuned.
Next update: Monday, November
29, 1999.