Group 1 - Concerns over the expanding U.S. government debt and deficit have led traders to bet on a surge in long-term U.S. Treasury yields, exacerbated by President Trump's tax cuts [1] - The latest downward bets align with Wall Street sentiment, as strategists from major banks like Goldman Sachs and JPMorgan have raised their yield forecasts [1] - Traders have placed significant bets that the 10-year Treasury yield will test 5%, with a notable $11 million premium at risk [1] Group 2 - On Monday, the 30-year Treasury yield briefly surpassed 5%, marking its highest level since November 2023, following Moody's downgrade of the U.S. credit rating from Aaa to Aa1 [3] - The hedge premium for greater losses on the long end of the Treasury yield curve has reached its highest level since April, indicating increased market volatility [3] - JPMorgan's client survey highlighted rising expectations for Treasury yield increases, with direct short positions climbing to their highest level since February 10 [3][4] Group 3 - The most active SOFR options indicate a strong demand for put options at the 95.75 strike price, particularly for those expiring in September 2025 [7][9] - The trading flow includes significant positions in put options, reflecting a market focus on hedging against rising interest rates [9][11] Group 4 - Recent CFTC data shows asset managers have significantly closed long positions, while hedge funds have covered short positions, indicating a trend towards deleveraging [13] - The net long duration closed by asset managers is equivalent to approximately 217,000 10-year Treasury futures contracts, the largest since November of the previous year [13]