STiRS DAILY

August 14, 2013

Eurodollar:

TECHNICAL:
The June 15 contract model is is clearly favoring a Short and the contract may have a way to go before finding support. We have been to 98.80 before....

FUNDAMENTAL:

Taper Talk rules the show and continued good data in both Europe and U.S will keep the contract under pressure.

SUMMARY:

Tech & Fundmntl suggest Fixed Income will underperform today.

Macro Theme:

Clearly the market will lean towards being SHORT the 10's knowing that the BIG TAPER is just months away. Remember the TAPER is new just as TARP was 5 years ago. Bonds caught a bid and stayed bid and since the Taper talk bonds have been largely offered and stayed that way and likely will. FED Talk is of course down playing the impact but for now the Macro Trend is clear - SHORT BIAS

Euribor:

TECHNICAL:
ERROR ON LOADING.........

FUNDAMENTAL:

Please see our BUND recap - ERROR should be fixed shortly

SUMMARY:

Tech & Fundmntl suggest Fixed Income will underperform today.

Macro Theme:

The ECB is out of tools. Their situation is precarious as recent data has bottomed out but not strong enough to turn the European recession around which means all they can do IS TALK DOWN RATES but TAKE NO ACTION!