T-bonds

Here is an hourly chart showing pit trading in the December T-bond futures. I last commented on this market here.

I had thought that the 111-08 level was the end of the rally from the May lows, but today's action has changed the picture. Now the drop from 111-08 looks like a three phase correction. This implies that the 111-08 level will be exceeded soon.

My best guess is that the market will rally about 1/2 a box above 111-08, i.e. to 111-29 or so.

After that I still think the market will drop into the 106-107 zone.