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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (20048)	10/15/2004 6:07:44 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

<Commercials took gains on 10 year note.> Looks like they continue to play the flattening yield curve, but perhaps with an overall basis towards a bit higher yields. They were long (w/options) 36,545 EDs on 10-05, now short 50, 911, and ramped back up shorts on the 5 year to 144,330. They are awfully heavily short (and spec lopsided long) the FX subtotal, and precious metals, maybe too much so, for one to be getting overly aggressive with anti-Dollar bets, this moment? Copper? The specs looked overly long, but that was last Tuesday above 1.44. For me, am now just inclined to see what the response is when Comex and LME combined inventories drop toward five digit numbers around Halloween. Currently a mere 129,106 MT, another new low. Energy just doesn't have the kind of spec long position, the Wizards and cognoscenti always whine about. Maybe only enough to get a brief pullback below $50, and setup the XLE at 33.00 support. Grains: that's the biggest spec short position I've ever seen, makes you wonder how they cover? The stock market does look vulnerable using COTs. If I had to hazrd a scenario, I'll bet the Wizards try to get max mileage out of the "extra 25 bps" rate hike by the end of the year. You know, where they talk about how vigilant they are? None of this impresses most of us, but the cognoscenti, that's a different story, they will run around like chickens with their head cut off if they start expecting that second rate hike. Ridiculous, but what can one do?