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Week ended 15th July, 2011 – Treasuries & Bonds this week .



Moody’s threatened to downgrade US rating, now these threats will definitely create pressure on US authorities to think about the US debt limit. In the early days of the week Italian & Spanish bonds fell and their borrowing costs rose into record level. 




Yields
15th-July-2011
7/8/2011-7/15/2011
7/1/2011-7/8/2011




2-Year Treasury
0.356
-9.18%
-18.16%
5-Year Treasury
1.442
-8.21%
-12.03%
10-Year Treasury
2.905
-3.87%
-5.14%
30-Year Treasury
4.246
-0.86%
-2.52%


After Moody’s cut of Ireland’s rating citing the probability that they need more finance to return into private borrowing market, Irish-German bond spread rose. After last week’s bad job report from US, shifting towards safer assets rose around the world, but later in this week situation has changed as many investors were booking their profits.


Coming week

Treasuries rose this week and there are not much changes in environment yet, for coming week. 2.872 was the recent low for 10-Year Treasury Yield, this week it just gave low above that. 2.80 and 2.65 are it’s next support level. In the upside 3.20 is the level it can test.
For 2 Year Treasury Yields, 0.48 is acting as good resistance, it broke 0.38 support level and it may test 0.332 support level. On the upside if it breaks 0.40 support level then it may test 0.48 level.
Last day I told about the 1.40-1.80 support level for 5-Year Treasury Yield. Though it broke 1.55 support level but it will be testing 1.40 support level in coming days. In the upside 1.55 and then 1.80 is good resistance for it.
As I said that 4.10 is a better support for 30-Year Treasury Yield, as such it bounced back above from that level. In the upside if it breaks 4.30 then it must try 4.40 level.

Treasury will sell $64 billion bills & securities in coming week.

Problems in PIGs countries are making things very difficult for investors and others, and now problem in Italy is coming ahead. Some words are coming that existing European rescue fund is not big enough to take on Italian bail-out. So we can guess if Italy is next then what will be the situation ! as financial world is finding it very hard to face the problems of these PIGs countries.
Now think about US,  what will be, if US defaults !   Fed gave some hints about the bail-out, but everyone is not listening it.



NOTE :  Please see the disclaimer below this blog .






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