Bond and Note Update

Here are updated hourly charts for the December t-bond and 10 year note futures.

I have completely misjudged the extent of the reaction from the post-Katrina highs in these two markets. However, I remain convinced that the level of bearishness at the August 8 lows together with the strength of the support at those lows will generate a move above the early June highs ( 119-23 in the bonds and 114-21 in the notes ).

Moreover, I think that the August lows of 113-24 in the bonds and 109-27 in the notes will hold.
Both these markets have dropped to box levels just above the ones which supported the August 8 lows as you can see on the charts above. I think both will turn up from here.