Key Takeaways with Craig

After a stronger than expected labor report was released this morning, US Equity prices initially fell, but recovered and were trading broadly higher in late afternoon action.  Treasury yields rose with the Micro 2-Year Treasury Yield future higher by about 14 basis points and the Micro 10-Year up by about 11.5 bps.  CME’s FedWatch tool also reflected a decline in probability for a 25 basis point rate cut at the March meeting from 55% to 44% and for a 50 point cut from 9% to 2%.   Implied volatility and CVOL levels fell in most of CME’s major products after the uncertainty of the results of the November Jobs report was removed from the market.  Below are the net price and volatility changes (at least as of about 2:00 PM Central time) on the week compiled using CVOL and QuikStrike data.

  • Even with today’s rally, Equity Index prices were down slightly on the week and implied volatility was near steady.
  • After hitting all-time highs, Gold prices were down by about 3% on the week and CVOL declined materially.
  • Micro 10-Year Yield futures were up slightly after today’s move and CVOL was higher on the week but well off earlier levels. 
  • Bitcoin futures prices were up another 13% while options implied volatility was near steady.

So that’s how we stack up heading into next week’s FOMC decision on Wednesday.  Have a wonderful weekend and we’ll see everyone on Monday.

Today's Future Price Action

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