Based on near and long term eurodollar yield curve. Attempts to indicate, through a spread median, how major players may position themselves in the near future.
Hey I think I love this indicator, but can you tell me how you use it?
csmottola71
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@theyardbirdswerejustok, It needs updating. The short Eurodollar contract should be march 22 and long december 22. In April make december 22 the short and march 23 the long. The ides is that the grossly unfollowed eurodollar futures rates ultimately indicate where the bond market will be headed. Since most of the dollar credits in the world are actually created offshore, the short term fluctuations in this indicator aim to show when a dollar shortage (or vice versa) is occuring.
theyardbirdswerejustok
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@csmottola71, Thank you for the update man. Does that mean it will need to be updated continuously? Also, please correct me if I am wrong but I think, if I have this right, that means when rates go up, $ are coming in and vice versa? Great help otherwise, will get to updating it myself.
csmottola71
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@theyardbirdswerejustok, Hi, sorry for the late answer, but I was busy with the war ) When rates go up slightly it can mean 1 of 2 things. 1) High demand of dollars, signaling economic growth (borrowing money to build infrastructure , for example) 2) Higher demand for Treasuries, would typically signal higher levels of borrowing. Instead, sharp movements in rates signal heavy levels of hedging against US Treasuries.