Friday, May 19, 2006


Here is an hourly chart showing regular hours trading in the June t-bond futures. I last commented on this market here.

The market has broken decisively above the 107-00 level, the last rally high on the way down to the 105-11 low. This action breaks a long sequence of lower rally tops and as such is very bullish. The volume associated with this rally is increasing (as best seen in its moving average) but is not exceptionally high; this also bodes well for continuation upward.

As I have pointed out in this previous post the market is at a level from which a 4-5 point rally would be a normal expectation. So I conclude that the 105-11 low will hold for at least several weeks and that the bonds are headed up to 110 or so.

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