Wednesday, April 19, 2006


Here is a highly condensed 15 minute bar chart showing pit trading in the June T-bond futures.

As I explained in my last post on bonds there is good reason to think this market is getting close to the point where a rally of 5 points or so is a reasonable expectation. More evidence for this view can be found on the 15 minute chart above.

Notice how the successive downswings c-d, e-f, g-h, i-j have grown progressively shorter in price and in duration. The rallies d-e, f-g, h-i have grown in length. The market has just reached support at 106-24.

This combination of factors makes me believe that the bond futures will soon move to 108-10 or so and that such a move has a better than even chance of being the start of a more substantial rally.

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