Yesterday was one of our busiest days of the year on the equities trading desk (from a number of trades and notional executed perspective). Today is the exact opposite. Our phones are exploding with asks for color. Unfortunately we aren’t seeing much. The long only community is frozen (again). There was massive desrisking into midterms and traders were surprised by yesterday’s move and got sucked back in. HFs selling back pockets of the market (hyperscalers) that they bought yesterday. ——John Flood 目前的情况，留好现金，低点抄底都注意只是空头回补，空头回补，不要过度格局。

True trend day down with range expansion, expecting lower prices tomorrow (Duh), Was talking with a friend - what percent of traders out there have seen a REAL bear market - where liquidity dries up and you are in the doldrums for 10 years. Just saying...

In fact, nothing highly unusual was found in the QRA. The coupon increases, which had drawn everyone's attention, naturally did not take place, and as expected, the phrasing in the guidance was changed from "for at least the next several quarters" to "for the next several quarters." In other words, the phrase "at least" was removed, which was anticipated this time around. Two additional phrases were added:"As part of that process, Treasury will engage with a variety of market participants to better understand evolving Treasury supply and demand dynamics," and "In considering any changes, Treasury will be guided by the objective of financing the government at the lowest cost over time." What particularly catches the eye is "variety of market participants." Looking back, this expression was previously used during the TIPS increase in November 2020 and the coupon cuts in November 2021. Considering that it was used in 2021 when the 7Y and 20Y were reduced relatively more heavily, we can see that the phrase "variety of market participants" actually hints at decisions regarding distribution across issuance tenors and shifts in that distribution. The market was already somewhat aware of these changes in tenor distribution. Aside from that, the mention of a "considerable debate" regarding the FY27 increases in the TBAC Reports stands out. I still believe this noise will likely be sorted out in the upcoming QRA next January and ultimately put into action around the second quarter.

#Commodities#: #Gold# trades near USD 4,200, recovering from a challenging week that saw prices fall to a two-month low as bond yields surged to fresh multi-year highs. The rebound has been supported by a recovery in US Treasuries following a well-received 30-year bond auction, alongside some easing in oil prices, although fuel costs remain elevated. Gold ETF demand has remained remarkably resilient throughout the recent surge in yields, with total holdings rising to a fresh four-year high on Thursday. Combined with renewed Chinese demand following the Golden Week holiday, this underlying investment appetite is helping bullion recover and challenging recent attempts by short sellers to push prices lower. Brent #crudeoil# trades near USD 103, retreating from Thursday's high near USD 106 after Trump ruled out an attack on Iran ahead of the US midterm elections. This signals a potential three-week period of relative calm, which, provided Iran refrains from further escalation, could allow crude exports from the Gulf to remain elevated. However, the underlying stress in the oil market remains concentrated in refining capacity and the availability of refined products, particularly middle distillates such as diesel and jet fuel. Gulf product exports are estimated at around 50% of pre-war levels (Kpler), highlighting the continued supply shortfall. A sustained recovery in refinery operations and product exports will therefore be essential before the market can begin to normalise, even as crude flows continue to improve. The Bloomberg Commodity Total Return Index is heading for its first weekly gain in three, up 1.6% at the start of Friday’s session, lifting its year-to-date advance to 35%. Despite persistent macroeconomic headwinds, all sectors are contributing to the recovery, once again led by energy, where natural gas and particularly diesel futures have posted strong gains. Perhaps surprisingly, given how the week has unfolded, precious metals occupy second place, with gold heading for its best weekly performance since early August. Industrial metals are also trading higher, albeit with more modest gains led by copper and zinc. Agriculture is contributing with most grain and soft commodity futures posting small weekly gains, led by soybeans, corn, sugar and cotton.

1/ This month’s 2026/27 U.S. #corn# outlook is for larger supplies, exports, domestic use, and ending stocks. Ending stocks rise by 282 million bushels to 1.8 billion. From the October World Agricultural Supply and Demand Estimates (#WASDE#) report:

USDA's U.S. corn ending stocks estimate lands near the high end of trade expectations on a much larger-than-expected yield. Soybean and wheat stocks also came in heavier than anticipated.

Long-term yields are gapping higher today for France, Italy and the UK. Things like 10y10y and 10y20y forward are up over 10 bps in these places. This sell-off has been building for many years going back to COVID and the huge fiscal expansion at the time.

Silver: this type of coil is one of the patterns that can precede an extended run. (remember the pothole repair area that comes in starting 6243?) trade above that area = confirmation.

ie: US buys 50bn of long-term OATs France contractually buys 50bn of energy/goods/etc (plus other intangibles) US current account deficit shrinks US taxpayer makes the ~200bps swap spread (minus hedging costs), so 500mm to 1bn (plus a warm & fuzzy feeling)

Coupon issuance (roughly 7 year wam) has been exactly the same for the last 2.5 years. Call it 3. The big bills issuance happens during the debt ceiling resolution in 2023 Q3 and was funded with RRP drawdown. But it took bills up 1.5TN so the numbers seem just wrong. Tbc wolf's current number is "correct" if you use bills outstanding and ignore the roll. I havent tried to recreate the 2024 garbage. My charts (one of which is the treasury TBAC) is the way to look at it. Frankly they could be even more outrageous if you just counted auctions as there are 52 7 day auctions and 13 28 day auctions etc. bottom line it's a mess