US TSYS: Late SOFR/Treasury Option Roundup
Early two way trade with slightly better upside call structure buying faded ahead midday, overall volumes remained light. Low delta put buying picked up in the second half as underlying rates sold off on improved risk appetite as large banks looked at options to aid ailing First Republic Bank (FRC).
- SOFR Options:
- Block, 6,000 SFRH4 97.00/98.00 call spds, 20.0 ref 96.10
- over 12,500 SFRM3 97.00/97.50/97.75 put trees on a 4x3x3 ratio trade on the day
- Block, 5,000 SFRU3 96.00 straddles vs. SFRZ3 96.12 straddles, 9.0 net/Dec over
- -25,000 SFRZ3 98.00/98.50 call spds, 7.0
- 3,800 SFRU3 94.00/94.50/95.00 put flys, ref 95.985
- 13,500 OQU3 97.87/SFRU4 97.50 call spd ref 96.68
- Block, 3,500 OQK3 97.00/3QK3 97.50 call spd, 17.0
- Block, 5,000 OQJ3 96.00/2QJ3 96.87 call spd, 40.0 net conditional curve
- Block, 3,750 OQM3 97.00/97.62 call spds, 15.5 vs. 96.465/0.15%
- 7,500 SFRK3 94.75/94.62 put spds vs. 95.75/95.87 call spds
- 7,500 SFRM3 94.75/94.62 put spds vs. 95.75/95.87 call spds
- 10,000 SFRZ3 94.50/95.50 put spds, ref 96.05 to -.045
- 2.000 SFRK3 94.75/95.00/95.25 put flys, ref 95.58
- over 13,700 OQM3 95.75 puts ref 96.53 to -.445
- Block, 2,500 SFRJ3 95.43 calls, 54.0 vs. 95.55/0.55%
- Blocks, 25,250 SFRK3 94.00 puts, 3.5-1.5
- Block/screen, 4,000 SFRM3 94.75/95.25/95.75 call flys, 8.5
- Treasury Options:
- 2,000 TYM3 112/120strangles, 133
- over 6,700 FVM3 109 puts around 57-100 ref 110-03.5 to -02.25
- 1,600 TYJ3 116.5/120 call spds, 27 ref 115-01
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US: Senator Feinstein Announces She Won't Run For Re-Election In 2024
Senator Dianne Feinstein (D-CA) has announced that she will not run for re-election in 2024, leaving her seat open for a competitive Democrat primary campaign.
- Feinstein, who will be 91 in 2024, said in a statement: "I am announcing today I will not run for reelection in 2024 but intend to accomplish as much for California as I can through the end of next year when my term ends."
- Democrat heavyweights Rep Adam Schiff (D-CA), who has received the backing of former House Speaker Nancy Pelosi (D-CA), Rep Katie Porter (D-CA), and Rep Barbara Lee (D-CA) have all expressed an interest in the seat.
- The Hill: "The state’s jungle primary, likely to be held in summer of 2024, also means that two Democrats may make it to the general election that November. That was the case when Vice President Harris won her seat in 2016 and Feinstein won reelection in 2018."
- Feinstein becomes the second Democrat senator to retire ahead of 2024, after Sen. Debbie Stabenow's (D-MI) last month, as Democrats face an exceptionally challenging 2024 Senate map.
EURGBP TECHS: Pullback Considered Corrective
- RES 4: 0.9097 76.4% Retracement of the Sep 26 - Dec 1 bear leg
- RES 3: 0.9047 2.0% 10-dma envelope
- RES 2: 0.8992 61.8% Retracement of the Sep 26 - Dec 1 bear leg
- RES 1: 0.8911/8979 High Feb 7 / 3 and the bull trigger
- PRICE: 0.8817 @ 16:27 GMT Feb 14
- SUP 1: 0.8804 Low Feb 14
- SUP 2: 0.8798 50-day EMA
- SUP 3: 0.8762 Low Jan 30
- SUP 4: 0.8722 Low Jan 19 and a reversal trigger
EURGBP trend conditions remain bullish despite the retracement early this week. On Feb 2, the cross cleared 0.8897, the Jan 13 high. The break confirmed a resumption of the uptrend that started early December and sights are on 0.8992, a Fibonacci retracement. Moving average studies remain in a bull-mode position, highlighting an uptrend. First support to watch lies at 0.8798, the 50-day EMA.
OPTIONS: Expiries for Feb15 NY cut 1000ET (Source DTCC)
- EUR/USD: $1.0490-00(E554mln), $1.0650-70(E1.3bln), $1.0700(E1.2bln), $1.0715-20(E694mln), $1.0800-05(E1.1bln), $1.0830-50(E1.3bln)
- USD/JPY: Y130.00($1.1bln), Y130.15-21($1.1bln), Y134.00($1.2bln)
- AUD/USD: $0.7000(A$1.2bln)
- USD/CAD: C$1.3300(E700mln), C$1.3400(E690mln)
- USD/CNY: Cny6.8500($2.2bln), Cny6.9500($1.3bln), Cny7.0000($1.3bln)
