Gotta make this quick. The A/C guy is at the office this morning so I’m crunched. Bad timing. Institutions keep buying the highs though volume is weak so I have no real strong sentiment for you (as usual lately). There is just no volume in this market as we grind through this range and nobody wants to make the first move. The market seems to give more weight to the PPI this morning as I expected. Housing is old news and everyone expects things to be marginal. The big flush for housing is long since priced in IMO. Unless we see horror show numbers in housing nobody is going to react much anymore. But despite the rally in the Euro and the sell-off in the 10s the carry cross hasn’t followed which makes my long bias cautiously pessimistic. If the follow through doesn’t show up in institutional traded volume or interest rate arb it isn’t real or if it is it is fragile. Nothing new. I wouldn’t put a position trade on either way today. About all I would to is maybe take a long and sell into the test of the R2. Not very ambitious I know but that is all that is there really. On the short side we may very well see a retracement back to the the high 70s where I think some new interim support is trying to develop. That said I love that long off the 78-79 handle and the short off the 90-91 handle best today…
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