US T BONDS
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GENERAL OVERVIEW OF US T BONDS MARKET
ISSUE DATE: JUNE 5, 2006
We think the influence of the two D lines, D1 & D2, will dominate bonds and force price to target 1. If bonds can remain above IC2 & IC3 then a major bottom will from at either of these two lines. We are bearish on bonds so we think it more likely that they will break down through IC2/3, most likely just after target 1. In that event target 2 should be reached. Once IC3 is broken on the downside that would signal to us the likelihood of a break down through the last support, LEC. That would be the start of a long term bear phase.
If bonds does break LEC, our best guess would be within 10 days after target 2.
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