Friday, January 06, 2006

Eurodollars


Here is a daily chart of the June '06 three month eurodollar futures contract.

The market has returned to the top of its current box and I think the next substantial move from here will be downward. I expect to see the September '06 contract (which currently trades 1 or 2 ticks higher than June) to trade near 94.80 (the bottom of the current box) within the next few months. That level may well end the trek towards higher short term interest rates that began in 2003.

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