Friday, May 05, 2006
Here is an hourly chart showing regular hours trading in the June t-bond electronic futures. I last commented on the bonds here.
As I noted in this post the bonds are at a point where it is reasonable to expect a rally of 5 points or so to develop. The rally on the employment number this morning saw the highest hourly volume reading in two months. This is an early hint that a significant upmove may have begun.
As I said in this morning's guesstimate I think the bonds will rally to the 107-16 level. Such a move would break the 107-04 level which is the last reaction high on the way down to the current low at 105-25. Such action would be another clue that a substantial rally has begun.
If as I suspect a rally of 5 points or so has indeed started I still think that later this summer the market will trade down to 105 or a little lower. After that a big bull market in bonds is likely to start.