Trump Plans to Extend Iran Blockade for Months, U.S. Bonds Fall in Response

BlockBeats News, April 29th, White House officials stated that President Trump met with oil company executives on Tuesday to discuss the possibility of a months-long blockade of the Strait of Hormuz if necessary. Upon hearing the news, the already under-pressure U.S. Treasury prices fell. Brent crude oil continued to rise in response to this news, with an intraday gain expanding to 5% at one point, further impacting the Treasury market.

Commodity Trading Advisors (CTAs) covered their profit-taking short positions after the data was released, only to resume selling shortly afterward. As key support levels across the yield curve were breached, algorithmic trading took the lead.

At the same time, U.S. Treasury yields kept climbing, with the 2-year yield reaching 3.90%, the highest level since March 30th. (FX168)