Cool-headed view of the after-math

Wed Dec17 (NY) - by Anatoly Veltman, Chief Global Analyst - So FOMC blew expectations out of the water: basically pledging to back-stop everything and anything + taking Central Bank rate closer to zero sooner than expected! Currency markets hinted strong trend: with Swiss Franc rising seven straight days and breaching major trendline in the hours prior to the announcement! The aftermath: EUR/USD blew through 38.2% retracement and stopped dead at 50% of 2008 1.2335-1.6040 range! EUR/GBP sliced through previous 0.9020 record and struddles 0.9200 as we speak. Treasury yields are keeping up their unbelievable month-long run, with long rates now exploring the nirvana of newly-discovered 250 basis-point room to zero-rate!! Just because prompt paper yields zero - should players be over-reaching for yield that aggressively?? A typical trap in my book; but trends are so hard to resist before New Year! Open Interest this morning sports unusual of late jump across all Treasury maturities! And finally: Open Interest in bigSP diverged from E-mini's. It didn't rise - E-mini's and Treasuries notwithstanding, and unusual for pre-expiry! . . . (to read the remainder of this article, please log in below.)