iShares Long-term Bond Fund (TLT) ticks 8 cents higher to $116 on poor housing data and in-line inflation [PPI] numbers. Focus next turns to this afternoon’s release of FOMC minutes from their January meeting. Minutes from the December meeting seemed to suggest that some Fed members want to see an end to QE3 by summer 2013. So, today’s text will be scrutinized for additional signs the Fed is ready to begin lifting its foot off the monetary gas pedal. One player in the options market seems to think there could be bad news for long-term Treasurys, as a 22,500-lot of Apr 114 puts is bought on TLT today for $2.01 per contract on ISE. Data from the all-electronic ISE confirm that the puts were bought, to open. If so, it probably adds to the 25K TLT April 114 puts opened yesterday and will create the second largest block of OI in the product, behind the Mar 116 puts.
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Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.