ESH finally trades below the Feb 1 FOMC low
February 21, 2023
–On Feb 1 ESH3 low 4048.5. That was the day of the FOMC meeting. This morning is the first time in Feb that ES has traded below that level, with a low this morning 4047.75. In comparison, TYH low on Feb 1 was 114-175. After a brief rally the next day, the huge 517k payroll report on Feb 3 saw TYH3 with a low of 114-135….and it has only gone down from there, now around 111-19.
–On Friday the front end was weakest on the strip, with the first four quarterlies settling lower on the day. For example, SFRZ3 settled 9498, down 4 on the day, and every contract behind was higher, with greens (3rd year forward) being the leader, closing +4. Everything is lower this morning, with SFRZ3 9493.5 (lowest print of the cycle 9490 on Friday).
–Today’s news includes Existing Home Sales expected 4.1m. At the beginning of 2022, just one year ago, this number was 6.5 million. Chart attached. Two year auction as well; 2s ended Friday at 4.62% (wi is 4.64 this morning). One year ago the 2y yield was just above 1.5%.
