OPTIONS: Extremely Busy Session Includes Large Outright Euribor Call Trades
Nov-05 17:52
Wednesday's Europe rates/bond options flow included:
- RXZ5 130.00/130.50cs, bought for 10 in 4.2k
- RXZ5 129/128.5/128p ladder vs 131c, bought the ladder for 5 in 3k
- RXG6 128.50/127.50ps vs 131.00/132.00cs, bought the ps for 2 in 1.5k
- ERH6 98.06/98.18/98.31c fly, bought for 1.5 in 10k
- ERH6 98.06/98.18cs, bought for 2.5 in 10k
- ERH6 98.1875 call, sold for 2 in 8k
- ERU6 98.50c, bought for 3.25 in 17.5k total
- SFIZ5 96.30/96.15/96.05 broken put fly paper paid 6 on 8K
- SFIG6 96.55/96.65/96.75 call fly paper paid 1.5 on 7.5K
- SFIH6 96.45/96.55/96.65/96.75c condor vs 96.25p, bought the condor for 0.25 in 2k
- SFIJ6 96.25/96.15 put spread 6K given at 1
- 0NU6 96.80/97.10cs vs 0NU6 96.30/96.00ps, bought the cs for -0.25 and flat in 7.5k
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US TSYS/OVERNIGHT REPO: ON RRP Takeup Dips, Remains Negligible
Oct-06 17:30
Overnight reverse repo takeup fell $3.6B Monday to $21.8B.
- That's up from the multi-year low $8.4B posted Thursday after quarter/month-end takeup reversed, but overall takeup effectively remains negligible.
- ON RRP + reserves were under $3T as of last Wednesday, potentially getting nearer to the Fed's "ample" threshold of reserves from the current "abundant" regime.
GBPUSD TECHS: Trading Below Resistance
Oct-06 17:30
- RES 4: 1.3789 High Jul 1 and key resistance
- RES 3: 1.3726 High Sep 17
- RES 2: 1.3661 High Sep 18
- RES 1: 1.3537 High Sep 23 and a pivot level
- PRICE: 1.3476 @ 16:27 BST Oct 6
- SUP 1: 1.3324 Low Sep 25 and the bear trigger
- SUP 2: 1.3282 Low Aug 6
- SUP 3: 1.3254 Low Aug 4
- SUP 4: 1.3144 38.2% retracement of the Jan 13 - Jul 1 bull cycle
A bear cycle in GBPUSD that began Sep 17 is intact, for now. Initial key resistance to watch is unchanged at 1.3537, the Sep 23 high and a near-term pivot level. Clearance of this hurdle would signal a potential reversal. Recent weakness resulted in a break of a trendline drawn from the Aug 1 low. Note too that 1.3333, the Sep 3 low and a key support, has been pierced. A resumption of weakness would open 1.3282 next, the Aug 6 low.
US: White House Press Conference Underway Shortly
Oct-06 17:01
White House Press Secretary Karoline Leavitt is shortly due to brief reporters at the White House. LIVESTREAM
- Comes as Senate Majority Leader John Thune (R-SD) prepared to hold a fifth vote this evening on the House-passed Continuing Resolution to fund the government through November 21. The bill is expected to fail again, and Thune has shown no sign of changing tack on his strategy to keep re-running the vote until Democrat Senators fold amid a pressure campaign led by White House Office of Management and Budget Director Russell Vought.
- Canadian Prime Minister Mark Carney will travel to Washington, DC, today ahead of a meeting with President Trump tomorrow. Expectations are low for any major trade breakthroughs.
- House Speaker Mike Johnson (R-LA) and National Economic Council Director Kevin Hassett both signalled in interviews on Sunday that federal worker layoffs are coming. Johnson said layoffs would be “a regrettable situation that the president does not want,” while Hassett said layoffs would start “if the president decides that the negotiations are absolutely going nowhere.”
- Trump-appointed US District Judge Karin Immergut yesterday blocked Trump’s latest attempt to deploy National Guard troops to Democrat-run cities. The ruling is the second blow in two days to Trump’s bid to send National Guard troops into Portland, Oregon.
- The Wall Street Journal notes, “Trump plans to federalize 300 members of the Illinois National Guard despite the objection of Gov. JB Pritzker [D-IL].”
