Key Takeaways with Craig

US Treasury yields spiked after this morning’s January Employment Report reflected much stronger job growth in the US than expected.  CME’s Fed Funds futures also reacted to the jobs report, as could be seen in the FedWatch tool.  Yesterday, that tool was reflecting a 62% chance of “no change” to the Fed Funds target rate at the March meeting and a 38% chance of a rate cut; today the probability of “no change” jumped to about 80%.  Despite the higher yields and interest rate expectations, US Equity prices rallied sharply to trade at or near record highs.  After the dust had settled on this week that was full of market-moving news, here’s the weekly net price and volatility changes in some of CME’s major products, compiled with CVOL and QuikStrike data:

  • After today’s rally both the E-mini S&P 500 and Nasdaq-100 were up by about 1% on the week.  Implied volatility in the options was little changed and continues to trade near recent lows.
  • WTI Crude Oil futures prices, after a recent rally, fell about 8% to near $72 per barrel.  CVOL levels rose in the options.
  • Gold fell today but was up by about 1% on the week.  CVOL levels rose on the week but remain near 3-month lows.
  • Even after a 17 basis point rally today, the Micro 10-Year Treasury Future yield fell by about 12 bps on the week.  The Micro 2-Year rose by about 3 bps, widening out the inversion between the 2s and 10s.
  • Finally, Bitcoin futures prices were up on the week by about 2% while implied volatility in the options traded down to levels not seen since October, 2023.

We hope everyone enjoys their weekend after an eventful week of trading.  We’ll see you all on Monday.  

Today's Future Price Action

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