How to trade the projected rate's hike?

Volatility trades on US 10-Y

It seems market's participants are already looking to trade the decision from Kevin Warsh, head of the fed, that is going to be more than just a decision, but a proof of independence from the Trump administration. Indeed, over 22,500 US 10-year October 107.25 straddles have been sold at 57 for a premium of roughly 20M. Brief reminder, a straddle is an option strategy where we buy a call and buy a put at the same strike. It is used when you usually don't know the directions the underlying is going to take but you know a lots of volatility is going to happen, making the underlying going either deep down or deep up. In the other side, as the implied volatility is priced in for these options, some traders consider that the IV is high enough for them to take advantage of selling US 10-year November 107.50 straddles for $10M premium.

Level bet also called directional bet

If the decision is hawkish and rate increase by 25bps, bond values are going down, so if you think it is not entirely priced yet, you can for instance go short on short term bonds like US 2-year whose level is going to be more impacted than the longer term bonds.

Slope Bet

In the same idea, you can be on the yield curve getting flatter, with an increase in short term yield that will flatten the curve making it interesting to trade a 2s10s slope.

Curvature bet

On a Curvature trade, you could have a thesis that is the FED is raising rates and the market concludes that rates will remain high for several years, but the long term vue does not change much, we could make a 2s-5s-10s trade. In other words we buy the two 5 years and sell one 2 years and one 10 years. More precisely we would adjust the weights for each bond position to have normally DV01 weighted wings.