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Treasury & Bond market review after 19th August, 2011.


10-year US Treasury was below than 2% !   perhaps there are not many people who is going to believe that but this was the reality. 30-Year Treasury is stealing the show this time from others as it was one of the best performer this week.

Yields
19th-August-2011
8/12/2011-8/19/2011
8/5/2011-8/12/2011




2-Year Treasury
0.192
0.00%
-33.56%
5-Year Treasury
0.893
-6.68%
-23.62%
10-Year Treasury
2.066
-8.13%
-12.35%
30-Year Treasury
3.391
-8.94%
-3.27%

Many were disappointed this week by the statement of S&P about their confidence on  AAA rating of Franc. This week Iceland central bank raised interest rate to control their rising inflation rate.



Coming week

I was expecting some rebounds this week but Treasury Yields remain flat with downward pressure, look like they are making some ground for another move.

2-Year Treasury Yields are getting support at  0.19 level. On the upside it has a resistance at 0.26 level.
5-Year Treasury Yields is getting support at 0.90 level and it’s resistance is at 1.10 and then at 1.40 level.
10-Year Treasury Yield is trying to break 2.10 support level and on the upside it has an initial resistance at 2.30 level.
Like other Treasury 30-Year Treasury Yield was flat with downward trend, as it was trying to break 3.40 level. On the upside it has a resistance at around 3.80 level.

US Treasury is going to sell $180 billion bills and notes in coming week.

Last week ECB’s Bond buying was good but it needs to support more to prevent short selling or any kind of panic selling. The EU leaders need to remove the fear of investors both by their talking and activities but I don’t thing they are doing that. Morgan Stanley cut it’s global growth forecast, which does not reflect good thing at all.
What look different to me that in onside we have EU debt problem for which it’s Bond yields are going at higher levels but on the other side US is still selling Treasuries at lower yields, in spite of that S&P downgrade. That means that downgrade from AAA ratings has not effected much to the investors or it may be that they need more time !   I would like to see Treasury and Bonds movement if stock market goes more downward from here.


NOTE :  Please see the disclaimer of this blog .


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