(5-18-14) We continue to trade the June Long Bonds from the long side. We were buyers once again in early Friday session on our standing orders at 137.13 which we were able to get out on the midday lift back to 137.22. Bonds came down to session lows in late action. We would look to be a buyer of the Bonds again on any test at 137.00. The US Treasuries are the key indicator of the current speculative bubble on the planet. Watch to see if the 10-year yields drop below the magic 2.40 % yield and watch for any increase in yields in Euro-junk sovereign debt, i.e. Greek, Portuguese and Irish.
The June Dollar contract continues to meander just above 80.00. However with US Treasury yields continuing to fall, the Dollars should not be trading higher and are only doing so vis-à-vis the action in the Euros. We do not like the long Dollar trade as we don't think the return to 81.00 is in the cards, unless Mario Draghi foot dragging suddenly stops, something we do not expect to occur.
We continue to trade the June Oil from the short side, selling on rallies up to 102.