Bonds and Notes

Here are updated hourly charts of the September T-bond and 10 year notes futures.

Last Thursday both markets reached their downside targets of 115-04 and 110-30. I believe Thursday's lows marked the end of the drop from the June 3 top of 119-23 in the bonds and 114-21 in the notes. The next big move will be upward. I expect the bonds to trade into the 121-123 range and the notes to reach the 116 level. The upcoming move will probably be the final leg of the bull market which began from the May 2004 lows at 103-02 in the bonds and 107-25 in the notes.

Over the next few days the bonds should rally to the top of their current box at 116-18 and the notes to the 1/2 point of the box at 111-26. These levels represent 1 box rallies from last week's lows.