Mid-day Update

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The thirty years bonds reached 144; I don’t think there will be sellers. To run the bonds up might be the last good play until the Fed comes out firmly in favor of more purchases.

Otherwise, next stop on the Uncle Russ train is 895; below that, 880.

I’m watching the implied volatility reading in the lower right panel. Back tests show that when this goes over the 50% mark and crosses above historical volatility in a six month window, short volatility plays work nicely. E.g., puts in VXX– especially those dated after the sure-to-come-nonetheless-imagined events, like sequester.

I really appreciate the comments during the past few days at Effective Volume.

cherry_bskt

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